Twin Cities Housing Market 2026: Should You Buy, Sell, or Wait?

by Sandy Erickson Real Estate Team

Twin Cities Housing Market 2026: Should You Buy, Sell, or Wait?

Wondering whether you should buy, sell, or wait in the Twin Cities housing market as we head into 2026?
You’re not alone — and the right answer depends on both the market and your personal situation.

The Twin Cities housing market continues to evolve. Interest rates have shifted, inventory remains tight, and many homeowners are weighing lifestyle changes like downsizing, upsizing, or relocating. This guide breaks down what’s happening locally and how to decide your next move with confidence.

A Snapshot of the Twin Cities Housing Market Heading Into 2026

While no one can predict the market perfectly, recent Twin Cities data gives us helpful direction.

Housing inventory remains below normal.
A balanced market typically has about 5–6 months of inventory, yet the Twin Cities has been hovering closer to 2–3 months, keeping upward pressure on prices.
Home prices have stayed resilient.
Despite rate changes, Twin Cities home values have continued to trend upward over time due to strong demand and limited supply — especially in well-located suburbs and established neighborhoods.
Mortgage rates are lower than their recent peak but higher than historic lows.
Compared to 2023 highs, rates have come down, improving buyer affordability slightly — though they remain above the ultra-low levels many homeowners locked in years ago.

Bottom line: This is not a boom-and-bust market. It’s a tight, competitive market that rewards good timing and smart planning.

What Interest Rates Mean for Buyers and Sellers

For Buyers

Mortgage rates directly impact monthly payments. Even a 1% change in rate can mean hundreds of dollars per month in purchasing power.

What to consider:

Buying sooner may allow you to refinance later if rates drop.
Waiting for “perfect” rates can mean paying more for the home itself if prices rise.
Pre-approval is essential in a competitive Twin Cities market.

For Sellers

Higher rates can narrow the buyer pool — but serious buyers are still active, especially for well-priced, move-in-ready homes.

What helps sellers succeed:

Strategic pricing based on current data (not last year’s market)
Strong presentation: staging, photos, and prep matter more than ever
Understanding buyer affordability in your specific price range

Supply and Demand: Why Inventory Still Matters

The Twin Cities continues to face a housing shortage, particularly in:

Entry-level homes
One-level living and townhomes
Well-maintained homes in established neighborhoods

What This Means for Sellers

Less competition often leads to stronger offers
Homes that are prepared and priced correctly still sell quickly
Many sellers are negotiating favorable terms, not just price

What This Means for Buyers

You need a plan — and flexibility
Some homes still receive multiple offers
Emerging neighborhoods or different home styles can offer better value

Lifestyle Shifts Driving Real Estate Decisions

Beyond numbers, lifestyle plays a huge role in 2026 decisions.

Remote and hybrid work continue to influence where people choose to live
Downsizing homeowners are looking for simplicity, one-level living, and lower maintenance
Upsizers are focused on long-term fit rather than short-term trends
Relocators want walkability, amenities, or proximity to family

The “right” move isn’t always about timing the market — it’s about timing your life.

Should You Buy, Sell, or Wait?

Buying in 2026 Makes Sense If:

You plan to stay put for several years
You’re financially prepared and pre-approved
You’ve found a home that fits your lifestyle and long-term needs

Tips for buyers:

Know your must-haves vs. nice-to-haves
Be ready to act when the right home appears
Focus on value, not just interest rates

Selling in 2026 Makes Sense If:

You’ve built significant equity
Your home no longer fits your lifestyle
You want to take advantage of low inventory

Tips for sellers:

Price based on current market data, not headlines
Small updates and staging can deliver strong ROI
Strategy matters more than ever — especially in a shifting market

Waiting May Be Right If:

You’re unsure about your next step
Your financial picture is still changing
You want to improve your home before selling

If you wait:

Monitor local pricing and inventory (not national headlines)
Revisit your plan every 6–12 months
Use the time to build clarity, not just hope for better conditions

Buying and Selling at the Same Time: What to Know

Many Twin Cities homeowners are navigating both transactions at once — and it can be done smoothly with planning.

Key strategies include:

Sale-to-purchase coordination
Contingencies that protect your move
Bridge solutions or short-term housing options when needed

Understanding your numbers first makes everything else easier.

Frequently Asked Questions

Are home prices expected to drop in the Twin Cities?
Most experts expect prices to remain relatively stable due to ongoing inventory shortages, though appreciation may be slower than in peak years.

Are some Twin Cities areas growing faster than others?
Yes. Neighborhoods with walkability, access to transit, and nearby amenities tend to see stronger demand.

Is it better to wait for rates to drop?
Waiting for rates alone can be risky. Home prices and competition often rise when rates fall.

Final Thoughts

The Twin Cities housing market in 2026 isn’t about guessing — it’s about strategy. Whether you decide to buy, sell, or wait, the best move is one that aligns with your financial goals, lifestyle needs, and long-term plans.

Contact the Sandy Erickson Real Estate Team today to schedule your free, no-obligation Home Move Plan consultation and we can come up with a game plan together!