A confident, advisory look at the market, mortgage rates, and what it means going into 2026

The Twin Cities Real Estate Market: December Update & What to Expect Moving Into 2026

The Twin Cities real estate market is closing out the year in a more balanced place than many expected. After years of rapid change—from ultra-low interest rates to sharp adjustments—the Minnesota real estate market in December 2025 reflects something quieter but more sustainable: stability paired with opportunity.

This Twin Cities housing market update breaks down what’s happening locally, how mortgage interest rates in Minnesota are influencing decisions, and what buyers and sellers should keep in mind heading into 2026.

Mortgage Interest Rates in Minnesota: What Buyers Should Know

Mortgage interest rates remain one of the biggest factors shaping the Twin Cities housing market. While rates are higher than what we saw during the pandemic years, they’ve begun to level out, allowing buyers to adjust expectations and plan more intentionally.

For many buyers, this shift has changed how they buy—not if they buy. Creative financing strategies, rate buydowns, and longer-term planning are becoming more common. In today’s Minnesota real estate market, preparation and clarity matter far more than timing the “perfect” rate.

Twin Cities Housing Inventory & Home Prices

Housing inventory across the Twin Cities metro has gradually increased, offering buyers more breathing room than in previous years. This doesn’t mean prices are falling across the board—but it does mean the market is rewarding realistic pricing and thoughtful presentation.

Twin Cities home prices have largely stabilized, with well-maintained and well-located homes continuing to attract strong interest. Sellers who understand current conditions—and price accordingly—are still achieving successful outcomes, especially in desirable neighborhoods.

What This Means for Buyers in the Twin Cities

If you’re considering buying a home in the Twin Cities, today’s market offers something that’s been missing for a while: choice. More inventory means less pressure, more negotiation, and the ability to make decisions that align with your long-term goals.

Understanding mortgage rates in Minnesota, local pricing trends, and monthly payment comfort is key. The most confident buyers right now are those focused on sustainability—not just the purchase, but the life they’re building beyond it.

What This Means for Sellers

Selling a home in the Twin Cities right now is less about speed and more about strategy. Homes that are priced accurately, marketed professionally, and positioned thoughtfully are still selling—and often smoothly.

The Minnesota housing market is no longer forgiving overpricing, but it is rewarding preparation. Sellers who take the time to understand current market dynamics are setting themselves up for stronger results.

The Twin Cities Housing Market Outlook for 2026

Looking ahead, the Minnesota housing market outlook for 2026 points toward continued balance. Interest rates will continue to influence behavior, but life events—moves, growing families, career changes—will always drive real estate decisions.

In a market like this, the most successful outcomes come from clarity, local insight, and intentional planning.

If you’re navigating a move in the Twin Cities metro and want to understand how today’s numbers connect to your bigger picture, I’m here as a resource.

📊 Current Mortgage Interest Rates (as of December 19, 2025)

National & Local Minnesota Mortgage Rates (30-year fixed):

• Minnesota 30-year fixed mortgage: ~6.29% (and ~5.63% for 15-year fixed) — current average in Minnesota according to Bankrate data. Bankrate

• National average 30-year fixed mortgage: ~6.21% according to Freddie Mac’s weekly survey. Freddie Mac

• Some local quoting sites show rates in Minnesota as low as ~5.99% on 30-year fixed and ~5.375% on 15-year fixed on the same day. Zillow

Context:

• These rates are slightly below the peak many buyers saw earlier this year and are modestly lower than a year ago, when 30-year fixed averages were around 6.7%-6.8%. YCharts

• Actual individual rates will vary based on credit score, loan type, points paid, and lender. Local Minnesota lenders may show slightly different figures than national surveys.

Over the past week, rates have moved slightly lower overall, drifting down from the low-6.3% range into the low-6.2% range. While daily fluctuations still occur, the broader trend suggests a steadier environment than earlier this year.

For buyers in the Twin Cities, this rate stability allows for more confident planning—especially when paired with increased housing inventory and more negotiation opportunities. For sellers, easing rate pressure helps support buyer demand, particularly for homes that are priced thoughtfully and marketed well.

As always, individual mortgage rates may vary based on credit profile, loan type, and lender, but these benchmarks provide helpful context for understanding the current Minnesota housing market.