Wisconsin Housing Market Continues Strong Growth in Fourth Quarter

Date:  February 13, 2003

For More Information Contact: David E. Clark, Economist C3 Statistical Solutions Inc.
Office phone: 262-549-4992
Cell phone: 414-803-6537

Madison - Fueled by historically low mortgage rates, home sales in the state grew by 15.4% in the fourth quarter of 2002, capping off what will likely be a record setting year for real estate, according to the Wisconsin REALTORS Association (WRA).

A seasonally adjusted total of 28,625 homes were sold in the state between October and December, a growth rate that outpaced both the nation, (which grew by 8.6%), and the Midwest region, (which grew by 9.2%) during the same period. 

"Mortgage rates continue to fuel this remarkably robust market," said Robert Weber, Chairman of the Board for the WRA. "Thirty year fixed rate mortgages were in the 6% range for the fourth quarter, and even inched below 6% in January." Weber predicted that while mortgage rates are not likely to fall much further, there are promising signs that the macro-economy is emerging from the recession which will continue to fuel a strong housing market. He noted that the U.S. unemployment rate fell 3 tenths of a point to 5.7% in January, and the Index of Leading Economic Indicators published by the Conference Board, has steadily improved over the fourth quarter 2002 after declining the previous 5 months. The index is a key barometer of future macroeconomic growth.

Multiple Listing Service (MLS) data for Wisconsin counties reveals sales in all areas of the state are above fourth quarter levels from one year ago. The strongest regional growth was in the North region where home sales were up 26.8% over Q4 2001. Oneida county grew at a hearty 51%. In addition, there was very strong growth in Lincoln county (+62.2%) and Burnett county (+50%), although these growth rates are based on relatively low base levels of activity. More moderate growth was experienced in Polk (+4.9%) and Washburn (+3.9%) counties. Barron county declined 1% and Douglas county fell 14.9%, although this is based on low levels of volume.

The populous Southeast region of the state grew at a solid 12.4% rate in Q4 2002 as compared to Q4 2001. Very strong growth was experienced in Walworth (+32.6%), Kenosha (+27.5%), Ozaukee (+26.1%) and Racine (+22.4%) counties. In addition, Washington county sales increased 17.2% as compared to the same quarter last year, Milwaukee county at grew 9.3% and Waukesha experienced 3.8% growth. The only county in the region which failed to advance was Sheboygan county, which declined 6.7% over the period.

The South Central region also grew at a healthy pace, with home sales up 11.8% over Q4 2001. Within the region, the strongest growth was experienced in the counties of Sauk (+43.7%), Jefferson (+42.4%) and Rock (+35.1%). Green county increased 8.9% whereas Dane county was up just 1.5% over the period. Columbia county experienced a decline of 6.6%. 

The West region also grew at a relatively strong pace, advancing 10.7% in Q4 2002 as compared to the same quarter last year. Very strong growth was experienced in the relatively populated parts of the region, with La Crosse county increasing 24.5%, and Eau Claire county up 18.8%. Pierce county sales, although somewhat smaller, grew at a robust 20.3%. Chippewa county was only up 1%; St. Croix county declined about 1.6% and Dunn county experienced a decline of 6.9%.

The Central region in the state grew at 9.3% when compared to Q4 2001 with strong growth in Waushara county (+21.3%), albeit on low volume and solid growth in the more populous Marathon county (+11.3%). Wood county also experienced healthy growth (+6.6%) whereas Portage county was flat (+0.7%) when compared to Q4 2001.

Finally, the Northeast region grew at 8.1% in Q4 2002 as compared to the same period last year. Topping the list of counties in terms of growth were Waupaca (+35.8%) and Shawano (+25%). Also experiencing double-digit growth were Calumet county (+18%), Outagamie county (+15.3%) and Door county (+14.6). The largest counties in the region registered growth, although at a more modest level. Specifically, Fond du Lac grew at 6.9% over Q4 2001, Winnebago increased 4%, and Brown county increased 2.9%. 

Home prices increased at a modest pace in the fourth quarter, according to WRA President Bill Malkasian, who noted the median housing price in Wisconsin rose 5.3% to $135,400 when compared to Q4 2001. "With the exception of the North region which was unchanged, all other regions experienced moderate appreciation of median home sale prices," said Malkasian. "Housing in the state remains a solid financial asset for Wisconsin families and represents an important component of household wealth." Malkasian pointed out that residential real estate has consistently outperformed other financial assets over the past several years. 

Sales

Median housing prices rose between 4.1% and 6.8% in five of the six regions in the state. The strongest regional appreciation rate was the Southeast part of Wisconsin which experienced a 6.8% growth of median prices to $142,000. Within the region, the fastest rate of appreciation (Q4 2002 as compared to Q4 2001) was Waukesha county, which increased 13.5% to $212,500. Also experiencing double-digit growth were Sheboygan county (+12.3% to $116,500) and Walworth county (+10.6% to $144,600). Ozaukee county grew 9.1% to $200,000 and median prices in Kenosha county increased 8.5% to $137,000. More moderate growth was seen in Milwaukee county (+6.3% to $120,000) as well as Washington County (+4.2% to $161,800). Racine county was the only county in the region to register a decline, but only slightly (-0.3% to $116,200). 

The West region experienced home price appreciation of 5.6% to $132,000 when comparing median prices in Q4 2002 with Q4 2001. The strongest growth was experienced in Chippewa county which rose 16% to $110,700. Both LaCrosse (+11.3% to $113,700) and Pierce (+11.7% to $170,000) counties grew in double digits, whereas Dunn county grew 7.8% to $115,000. St. Croix county advanced 7.3% to $174,300 and Eau Claire county rose 5.6% to $116,200.

In the South Central region, median prices rose 5.5% to $149,200 in Q4 2002 as compared to Q4 2001, with the strongest appreciation in Columbia county (+16.1% to $133,300), followed by Dane county (+9.8% to $180,000). Green county median prices rose 6.8% to $110,600. While the volume of sales was in excess of 35% in Rock, Jefferson and Sauk counties, their median prices did not change as dramatically as other counties in the region. Rock county experienced an increase in median prices of 3% to $101,200 and median prices were unchanged in Jefferson county at $130,000. Sauk county saw a modest decline of 4.4% to $118,900 in the fourth quarter.

Median prices in the Central region grew 5.2% to $102,900 in Q4 2002 as compared to the same quarter last year. Waushara county experienced the strongest median price appreciation (+15.8% to $110,000) followed by Wood county (+6.5% to $82,500) and modest median price growth in Portage county (+3% to $111,600) and Marathon county (+2.5% to $110,700). 

The Northeast region experienced median price growth of 4.1% to $118,500 in the fourth quarter 2002 as compared to the same quarter in 2001. Two counties that had double-digit appreciation rates were Door county (+16.7% to $175,000) and Waupaca county (+10.6% to $101,100). Robust median housing price appreciation was also seen in Calumet county (+8.8% to $155,800) and Winnebago county (+8.1% to $111,400). More modest growth resulted in the counties of Outagamie (+5.5% to $120,000) and Brown (+2.7% to $129,300). Fond du Lac county median price growth was just 1.1% to $101,100, and Shawano actually saw prices decline slightly (-2.9% to $87,400).

Finally, the North region experienced no median price change region-wide (i.e., median prices were $121,800 in both Q4 2002 and Q4 2001). However, there was wide variability within the region. For example, four counties had double-digit price appreciation, including Polk county (+22.5% to $145,000), Barron county (+20.3% to $114,300), Washburn county (+18.2% to $123,300), and Lincoln county (+14.6% to $88,600). In contrast, prices fell 1.2% to $136,900 in Oneida county; they declined 11.7% to $141,300 in Burnette county, and they slid 26.3% to $140,000 in Douglas county. It should be noted that the results for Douglas county are based on a relatively small number of sold properties in Q4 2002.

Median Housing Price

The Wisconsin REALTORS® Association is one of the largest trade associations in the state, representing over 12,000 real estate brokers, sales people and affiliates statewide. Sales estimates for the state are provided by the National Association of REALTORS® which seasonally adjusts quarterly sales figures. All county figures on sales volume and median prices are compiled by the Wisconsin REALTORS® Association and are not seasonally adjusted. 

Wisconsin Housing Statistics Online

Printable Copy of this Press Release

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