The Wisconsin housing market could set a record high this year, according to a news release from Wisconsin Realtors Association (WRA), which included its latest analysis of existing home sales.
September sales were up 6.9 percent over September 2015, according to the news release, and median prices increased 7.9 percent over that same period to $167,450. Through the first nine months of 2016, home sales were up 5 percent and median prices rose 4.8 percent to $165,000 over the first nine months of 2015.
“Whether you look at the month of September, the third quarter or year-to-date, home sales are at the highest levels since at least 2004," WRA board chairman Erik Sjowall said.
Demand outpaced supply again in September, continuing a concern realtors have expressed throughout the year.
“Unfortunately, we could have sold more if we had more to sell,” Sjowall said
Inventory levels fell to 43,363 homes in September, which represents 6.5 months of available supply.
“Usually we consider six months of supply to be a balanced market, but the available supply in the cities is much lower than the rural areas,” Sjowall noted.
Wisconsin’s two largest cities, Milwaukee and Madison, had 4.5 months and 4.1 months of supply of homes, respectively. In contrast, non-metropolitan counties in the state had 10.9 months of supply.
However, even with the tight supply of homes for sale, every region has seen steady sales growth through the first nine months of this year. The growth in existing home sales across the six regions of the state ranged between 3.4 percent and 6.3 percent this year compared to the first nine months of 2015.
The median price increased 7.9 percent to $167,450 over the period between September 2015 and September 2016.
“It is important to remember that home prices do follow a regular seasonal pattern,” said WRA President & CEO Michael Theo. “Prices move higher when the market volume peaks in the summer and then ease as the market activity tails off in the winter."
In September 2011, the median price was $134,900. Since then, prices have grown 24.1 percent, or 4.3 percent on a compounded annual basis.
The Wisconsin Housing Affordability Index shows the percent of the median-priced home that a household with median family income can qualify to purchase, assuming a 20 percent down payment with the remaining principle financed with a 30-year fixed-rate mortgage. The index has been stable over the last 12 months and stood at 231 in September 2016, which is nearly identical to the value from 2015.