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How long will the hot housing market last?

According to a new report, demand for housing is at a 20-year high, while supply is at a 20-year low.

MINNEAPOLIS — A new report from Minneapolis Area Realtors shows the housing market is still hot right now.

According to the report, demand is at a 20-year high, while supply is at a 20-year low.

"It's still hot right now,” Minnesota Realtors CEO Christopher Galler says.

Galler says the rest of Greater Minnesota is also following this trend.

He says the housing market statewide did slow down over the holidays, and during that first week of January — like it normally does.

But the market has picked up since then and has been going strong during the first few weeks of January.

He says in a normal year, the winter housing market doesn’t get going until after the Super Bowl.

"This year we're starting to see it earlier and I think a lot of that has to do with interest rates going up, and people want to take advantage of it,” Galler explains.

So, what does that mean for the spring and summer? Will buyers see a lot of competition and crazy offers?

"I think we'll get more into a typical marketplace — a more typical inventory. I think it really depends on how fast those interest rates go up,” Galler says.

If the interest rates go up by a little, Galler says that shouldn't affect the market too much, but if they go up by 0.5 or 0.75 of a percent over the next few months, that could bring this hot market back down to normal.

That's why he predicts home prices won't go up as much as they did last year.

"I think we'll see average increases, maybe 5 percent by the time we talk next year at this time,” Galler says.

So, if you're looking to sell, he recommends getting your information together sooner rather than later, and buyers should do the same.

"I think it's a good time for people to make sure they've got their finances in order, that's always the first step."

Get in the market now before it gets busy, and lock in your interest rates before they're expected to go up later this year.

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