Weekly Market Report  |  Stillwater, MN 55082

As the Heat Rolls Back In, Is Stillwater's Seller's Market Finally Cooling?

Thirteen new listings. Eight properties under contract. Inventory at 65 homes and climbing. And for the first time in a long while, a Market Action Index that is moving in the wrong direction for sellers. Here is what the numbers actually say — and what they don't.

By Richard McDonough  ·  Senior Global Real Estate Advisor, Lakes Sotheby's International Realty  ·  Fourth-Generation Stillwater Resident
Published July 26, 2026  ·  Data: Altos Research, week ending July 26, 2026  ·  9 min read

The Short Version

The heat rolled back into the St. Croix Valley this week, and so did a question I have been turning over for a month now: are we watching the front edge of a genuine shift in the Stillwater market?

My honest answer is that we are watching something, and I would rather name it early than pretend it isn't there. Thirteen new listings came on this week with two more marked coming soon. Eight properties went under contract. That is real, healthy movement for the last week of July — a stretch when buyers and sellers alike are traditionally at the lake, at the cabin, or watching the boats go under the Lift Bridge rather than touring houses.

But underneath that activity, the supply-and-demand math is quietly rebalancing. Inventory keeps climbing. Prices keep notching down. And more than a third of everything currently for sale in 55082 has already taken a price cut.

Inventory Is Climbing — and That Changes the Negotiation

There are now 65 active single-family listings in the 55082 ZIP code. That number has been trending upward for weeks, and it is the single most important variable on this page. Everything else — days on market, price reductions, negotiating leverage, the Market Action Index itself — is downstream of how many homes a buyer gets to choose from on a Saturday afternoon.

I want to be careful here, because rising inventory by itself is not a crisis and it is not a crash. Some of it is seasonal. Some of it is a normalization from inventory levels that were historically, unsustainably thin. What matters is whether buyer demand is keeping pace with the new supply. Right now, the honest reading of the data is: almost, but not quite.

Run the absorption math from the Altos quartile data and roughly seven homes per week are being taken off the market across all four price segments, against roughly eight new ones arriving. At that pace, 65 active listings works out to somewhere in the neighborhood of two months of supply. Historically, that is still a seller-leaning market in Stillwater. But it is a meaningfully different market than the three-week supply we lived through a few years ago, and buyers can feel the difference before any headline confirms it.

The Market Action Index Slipped to 47

Altos Research's Market Action Index compares the rate of sales against available inventory. Above 30 is generally considered seller-favorable territory. Stillwater currently sits at 47, down from 50 a month ago.

So on paper, 55082 is still labeled a strong seller's market, and that label is accurate. But I have been reading this index for years, and the level matters far less than the direction. A market drifting down from 50 to 47 to the low 40s is a market where the leverage is gradually moving across the table — and the sellers who recognize that early are the ones who still get their number.

If the MAI continues to fall and eventually crosses into buyer's territory, the historical pattern is straightforward: prices keep easing until the index turns back up. That is not a forecast, and I am not going to pretend I can time it. It is simply the mechanism, and it is worth understanding before you list.

The Price Gap Nobody Is Talking About

Here is the number from this week's report that stopped me: the median list price of everything currently on the market is $859,900. The median price of this week's new listings is $559,999.

That is a gap of roughly $300,000, and there are two readings of it. The first is a mix shift — more mid-market homes are coming online right now than upper-bracket ones. The second, and I think the more useful one, is that sellers coming to market this month are pricing to sell rather than pricing to test.

Meanwhile, the standing inventory at $859,900 includes a meaningful number of homes that were priced for a market we had, not the market we have. That is precisely why 37% of active listings have already reduced their asking price — and why exactly 0% have raised one. When a third of a market is cutting and none of it is raising, that is not noise. That is a signal.

Price Per Square Foot Is Holding at $267

Interestingly, even as median list prices drift lower, price per square foot has stayed reasonably flat at $267. That combination almost always means the same thing: the mix of what is selling is changing more than the value of any individual home is falling.

Put plainly — a well-presented, well-priced home in a desirable Stillwater location is still commanding strong per-foot value. What has softened is the market's patience for homes that are overpriced, over-improved for their block, or simply not ready for photographs. The premium is still there. It has just become more selective about who receives it.

Days on Market: 59 Average, 35 Median

Homes currently listed have been on the market an average of 59 days, while the median sits at 35. The spread between those two numbers is itself informative: it means the market is splitting into two groups. A cohort of fresh, correctly-positioned listings is moving in about five weeks, while a longer tail of aging inventory is dragging the average upward.

Add the relisting rate — 11% of current inventory has come off and gone back on — and the picture sharpens. Some sellers are already on their second attempt. In my experience, the second attempt is always harder and almost always more expensive than getting the first one right.

Where the Pressure Is by Price Segment

Stillwater is not one market. It is at least four, and they are behaving very differently from one another right now. Each segment below represents roughly 25% of active inventory, ordered by price.

Source: Altos Research, Inc. — Stillwater, MN 55082, single-family homes, week ending July 26, 2026. "New" and "Absorbed" reflect weekly counts.

The engine of this market is the $662,500 segment. Three new listings, three absorbed, and a median of just 24 days on market. That is a segment in genuine equilibrium — it is clearing inventory as fast as it takes it on, and it is doing it in under a month. If you own a four-bedroom, roughly 2,500-square-foot home in Stillwater, you are in the most liquid part of this market by a wide margin.

The upper bracket is where patience is required. The two highest quartiles are both sitting at 56 days on market, absorbing one home per week each. That is not distress — luxury inventory has always moved on a longer clock, and a $2 million property on five acres above the valley was never going to trade like a starter home. But it does mean that in the $1.2 million-plus range, pricing precision and presentation quality are no longer advantages. They are requirements.

The entry-level quartile is the odd one out. A $369,950 median with 49 days on market is slower than you would expect from the most affordable segment, and I attribute most of that to where mortgage rates have gone. Which brings us to the part of this report that isn't about Stillwater at all.

The Macro Overlay: Oil, Inflation, and a 7% Handle

I try to keep these reports local, because national real estate headlines are usually useless in a valley of 20,000 people. But some things do reach us here.

The on-again, off-again conflict with Iran is on again. Oil prices have responded the way oil prices always respond to Middle East instability — upward. Energy costs feed inflation, inflation feeds the bond market, and the bond market sets mortgage rates. The result is that we are looking at rates in the high 6s and brushing up against 7% for the first time in a while.

What that does to Stillwater specifically is anyone's guess, and I would be skeptical of anyone who tells you otherwise. But the mechanism is not mysterious. Every quarter-point costs a buyer purchasing power, and purchasing power is what turns a showing into an offer. It shows up first in the entry-level quartile, where budgets have the least slack — which is very likely part of what those 49 days on market are telling us.

Here is the part that gets lost in the noise: rate volatility cuts both directions, and it tends to thin the buyer pool faster than it thins the serious buyers. The people still touring homes at 7% are not casually curious. They are motivated, they are typically pre-approved, and they are frequently the best buyers you will meet all season.

What This Means If You're Selling in Stillwater

Four things, and I would say all four to a client sitting at my kitchen table:

1. Your first three weeks are the whole ballgame. With a 35-day median and 37% of inventory already reduced, the market is telling you plainly that homes priced correctly out of the gate are the ones that transact. The listings that sit are almost never sitting because of the market. They are sitting because of the number.

2. Do not price against last spring's comps. Prices have notched down for several consecutive weeks. A comparable sale from six months ago is a historical document, not a pricing strategy.

3. If you are in the $600–$750K range, this is your window. Twenty-four days on market and one-to-one absorption is as good as it gets in a softening market. That window will not stay open indefinitely if inventory keeps building.

4. If you are upper-bracket, plan for 60 to 90 days and market accordingly. That is not pessimism, it is arithmetic — and it is why luxury properties in this valley need genuine global distribution rather than an MLS entry and hope. The Sotheby's International Realty network exists precisely for this part of the cycle.

What This Means If You're Buying

You have more leverage today than you have had in several years, and I do not say that lightly. Sixty-five homes to choose from, more than a third of them already having reduced price, and sellers who are watching the same days-on-market data you are. Inspection contingencies, closing cost credits, rate buydowns, timing flexibility — these are all back on the table in a way they simply were not recently.

The rate environment is genuinely painful, and I will not talk you out of feeling that. But the old rule still holds: you marry the house and you date the rate. What you cannot refinance later is the price you paid, the location you chose, or the summer you spent waiting for a market that never announced its bottom in advance.

And if you are thinking about selling but are not ready to put a sign in the yard — particularly in the upper bracket, where discretion often matters more than exposure — the Quiet Listing Network is how I introduce properties to qualified, vetted buyers before they ever reach the open market. Several of the most satisfying transactions I have handled in thirty-three years never appeared publicly at all.

Frequently Asked Questions

Four Generations, One Valley

My family has been in Stillwater for four generations. I have watched this town through more market cycles than I care to count — the boom years, the correction, the pandemic frenzy, and whatever it is we are entering now. What I have learned is that the valley does not panic and it does not need to. Stillwater's fundamentals do not change because oil went up or an index dropped three points. The river is still there. The bluffs are still there. Main Street will still be packed on the Fourth of July at Lowell Park, and Lumberjack Days will still fill the streets.

What changes is strategy. And getting the strategy right — the price, the timing, the presentation, the negotiation — is worth more in a shifting market than it ever is in a hot one. That is the work.

I will be watching this one very closely. Same time next week.