After a long wait of mediocre local markets while neighboring markets flourished, the real estate boom has finally made it to the Mille Lacs area. Not since the mid-2000’s have the prices skyrocketed like they have of late. Earlier this summer when it truly was prime time for lakeshore and up north property, sales began to go through the roof and are still continuing.
It is a perfect recipe, with the current low interest rates, low supply of existing properties and high demand for the existing properties that are for sale – it’s a classic sellers market. To top it off, new home construction costs are at an all time high, lumber prices are through the roof and there are still many COVID-induced supply chain challenges. But with all that said, new construction numbers remain very high.
But this has been happening all over for a while now. Why did Mille Lacs finally get invited to the party? In the last 15 years, other markets surrounding Mille Lacs have fully recovered, and then some. Was it the constantly changing fishing regulations? The ongoing treaty lawsuits? If it was, nothing has been currently resolved with any of those issues. So does that mean people are no longer bothered by it?
Right now there are more million dollar plus listings on Mille Lacs than ever before. The top listing is a residence listed at a whopping $3.5 million. There are also several resorts on the lake, and area businesses currently for sale ranging from $1.5 - 2.5 million. Those are staggering numbers no matter what market you’re talking about, and it looks like Mille Lacs is finally in the conversation.
Mille Lacs has long been known as more of a “blue collar” lake than its surrounding neighbors. It’s always been a fishing lake first and recreation lake a distant second. It’s very large and wind driven, and that scares some people – and rightly so. But it also has the beauty, majestic rocks, fairly clear water and the endless views that are reminiscent second only to Lake Superior. But it actually has usable lakeshore, unlike a lot of Lake Superior.
Some examples of the current market gains
On the west side of Mille Lacs there’s a two bedroom, two bath, 600 square foot cabin on a small lot that sold for $160,000 in 2015 that currently has an estimated value of $315,000. That’s a 49% increase.
On the east side there’s a three bedroom, three bath, 2,900 square foot home that was originally listed for $440,000 in 2016, was on the market for over a year and eventually sold for $320,000. That house is now pending for $625,000. That’s a 48% increase.
It’s happening on non-lakeshore properties as well. A one bedroom, one bath with a large garage across from the lake that sold for $80,000 in 2018, recently sold for $170,000. That’s a 53% increase.
Currently, people that own property around Mille Lacs that were not even considering selling, are selling. It’s currently a seller’s market, and the people that are deciding to sell are taking full advantage of it.
What do the professionals say?
Hans Wolfe of Keller Williams Realty said, “The market is currently doing really good, but it was better in the spring. Houses are still selling before they even hit the market and others are selling in one or two days.”
Asking Wolfe why he thinks the current local market is so good, he responded, “With COVID and what’s been happening in the cities, people are realizing if they can work from home, why not work from the lake? And with the proximity to the cities, it makes coming to Mille Lacs even easier.”
According to Minnesota Realtors for the month of August, median home prices for the area were up 20% over this time last year. The days on the market (DOM) were down 27% indicating properties are selling in a shorter period of time, and are also selling at an average of 2.1% above original listing price, indicating there may have been multiple buyers for the properties.
Year-to-date median home prices are also up 16.7% over last year, closed sales are up 1.5% indicating more properties were sold so far this year than at this time last year, and they’re still selling for 3.8% above original listing price, and the DOM is down overall 38%.
Speaking with Ronda Bjornson-Main of Century 21 in Isle, she noted, “The market is hot, very hot. It cooled down just before Labor Day and with school starting, but has picked right back up.” Bjornson-Main went on to say, “There’s now way more than fishing when it comes to Mille Lacs, it’s a family lake.” When asked about the current boom, she said that with the proximity to the cities and easy access, Mille Lacs is still affordable. “It’s a melting pot that has everything from little cabins to million dollar houses.”
It will be interesting to see how long the local market stays hot. Maybe Mille Lacs’ real estate is on the map for good. Local homes, raw land, lakeshore lots, and lake homes are selling faster and for more than ever before in this current market, but will it hold on? Only time will tell.
In the meantime the local Mille Lacs folks are taking advantage of, and enjoying, the boom.