|
|
Robust Wisconsin Housing Market Sets All Time Record
2004 Fourth Quarter Outpaces Nation And Region
Date: February 16, 2005
For More Information Contact: David E. Clark, Economist
C3 Statistical Solutions Inc.
Office phone: 262-549-4992
Cell phone: 414-803-6537
Madison - The Wisconsin residential home sales market
set an all-time record in the fourth quarter of 2004, making
last year the strongest housing market in state history,
according to the most recent analysis by the Wisconsin REALTORS®
Association (WRA). Statewide, home sales increased 8.8percent
over the level established in the fourth quarter of 2003,
setting a Wisconsin fourth quarter record of 32,825 home sales,
and a record of 123,900 sales for the year. Nationally, home
sales were up by 7.3 percent for the quarter, and the Midwest
region saw home sales rise at 5 percent as compared to the fourth
quarter of 2003.
"This fabulous market can be attributed to a robust state
economy and mortgage rates that remained low by historical
standards," said WRA Chairman Kitty Jebwabny. "Key economic
conditions were in place through most of 2004. The average
statewide unemployment rate for the quarter was at 4.8 percent
and 30-year fixed rate mortgages averaged 5.7 percent for the
quarter, both of which continue to fuel demand for housing in
the state," she said. Jebwabny also pointed out that job
creation in the state has been solid for the last two quarters,
with about 52,000 additional jobs in the state in Q4 2004 as
compared to Q4 2003 (based on seasonally adjusted averages). She
noted that even the manufacturing sector has improved, adding
more than 16,000 manufacturing jobs in the state since the
fourth quarter of 2003.
Fourth Quarter Regional Sales Data
Sales figures for the fourth quarter were up in all regions
of the state, based on Multiple Listing Service (MLS) data for
Wisconsin counties. The growth rate for Q4 2004 over Q4 2003,
was strongest in the South Central region of the state
(+12.9 percent), followed closely by the Northern and Western
regions (10percent-10.3 percent range). Also strong were the
Southeastern and South Central regions (8.7 percent to
9.3 percent). Finally, the Central region experienced a solid
growth rate at 4.9 percent.
The South Central region was up a solid 12.9 percent in Q4
2004 as compared Q4 2003 with most of the counties experiencing
growth over the period. Two counties saw their sales volume
increase by 175 percent or higher. Although the increase in sales
volume in Lafayette County was minor (from two to six units),
the increased sales activity in Iowa County was more substantial
(i.e., sales were up 175 percent, growing from 12 to 33 units
sold). In addition, five Counties experienced double-digit
growth on solid volume (i.e., Grant County grew 47.6 percent;
Crawford County was up 43.5 percent; Green County advanced
31.3 percent; the largest County in the region, Dane County grew
16.1 percent, and Jefferson County expanded 14.1 percent in Q4
2004, as compared to the same quarter in 2003). Richland County
was up 28.6 percent, albeit on low sales volume. Two counties
grew at a modest pace (i.e., Sauk County was up 5.9 percent and
the more urban Rock County had sales increase 4.2 percent)
whereas two other counties experienced slight declines in home
sales (i.e., Dodge County fell 3.4 percent and Columbia County
declined 5.7 percent).
Growth for Q4 2004 over Q4 2003 was strong in the Northern
region of the state (+10.3 percent) with some rural counties
experiencing phenomenal growth. For example, Ashland and
Bayfield counties, which are combined for reporting purposes,
more than doubled their sales (+114.3 percent) on moderate
volume. In addition, two counties increased their sales more
than 80 percent (Price County was up 83.9 percent and Lincoln
County rose 81.4 percent), whereas Douglas County increased its
sales by 66.7 percent. Note that all three of these counties had
sales volume in excess of 20 units in Q4 2003. Also strong was
Forest County, which grew 77.8 percent, although it should be
noted that this was based on less than 10 sales in Q4 2003.
Burnett County increased 25 percent; Barron County was up
15.7 percent; and Rusk County grew by 14.7 percent, all on
moderate volume in the fourth quarter of last year. Vilas County
was up 2.9 percent and Oneida County increased 2.7 percent, both
off of very solid sales volume in the previous year. Several
counties fell slightly (Polk County dropped 2.1 percent; Langlade
County was down 2.4 percent; Taylor County fell 11.8 percent and
Iron County fell 17.4 percent), although none of these counties
experienced an absolute drop in sales volume of more than four
home sales. Two counties that did experience more substantial
percentage and absolute reductions in sales volume were Washburn
County (-22.2 percent) and Sawyer County (-24.5 percent).
The Western region of the state also grew at a very healthy
pace, advancing 10 percent over the levels established in the
fourth quarter of 2003. Within the region, Vernon County
increased in triple digits (+175 percent), but this was based on
just four sales in Q4 2003. However, two of the larger counties
in the region grew at much stronger rates. Specifically, St.
Croix County, which borders Minneapolis-St. Paul, grew at 24.3
percent, whereas La Crosse County increased 19.7 percent. The
remaining counties in the region either grew at a modest pace
(i.e., Pierce County was up 2.2 percent; Eau Claire County was up
1.7 percent); were flat (i.e., Chippewa County was unchanged and
Dunn County was off its 2003 pace by four home sales or
4.3 percent), or they fell more substantially (i.e., Buffalo,
Pepin and Trempleau counties, which are combined in this
analysis, fell 12.5 percent but on modest volume).
The Southeast region of the state grew at a strong 9.3 percent
in the fourth quarter of 2004 as compared to the same quarter in
2003 with all counties in the region experiencing growth.
Increasing by double digits were Washington County
(+22.9 percent), followed by Racine County (+18.8 percent),
Ozaukee County (15.9 percent), Walworth County (+11 percent) and
Waukesha County (+10.5 percent). All of these growth rates are
based on volumes in excess of 240 sales in Q4 2003. The
remaining counties increased at moderate, but still solid,
rates. Milwaukee County grew at 5.6 percent, Sheboygan County
increased 4.9 percent and Kenosha County increased 4.6 percent.
The Northeast region grew at a very respectable 5.5 percent in
the fourth quarter of 2004. Compared to Q4 2003, Menomonee
County was up 50 percent but on low volume. However, Marinette
County was also strong, increasing 42.9 percent on much stronger
Q4 2003 sales. Solid gains were also seen in Waupaca County
(+15.8 percent), Manitowoc (+15.6 percent), Outagamie County
(+11.4 percent), Calumet County (+11.1 percent) and Green Lake
County (+8.3 percent). Brown County grew at a 2.8 percent pace in
Q4 2004 as compared to the same quarter last year. Door and
Kewaunee counties, which are combined for reporting purposes,
were flat at (1.5 percent), as was Winnebago County
(-0.5 percent). Fond du Lac County was off its Q4 2003 pace by
4.1 percent; Shawano County fell 7.1 percent and Oconto County
slid 14.5 percent over the period.
The Central region grew at 4.9 percent in Q4 2004 as compare
to Q4 2003. Although Adams County experienced an increase of
more than threefold, this is based on sales of just four units
in Q4 2003. However, two other counties experienced solid growth
(Waushara County was up 21.7 percent and Clark County increased
18.2 percent) on more substantial Q4 2003 volume. Marathon
County, which is the only metropolitan County in the region grew
at 9.1 percent and Wood County was essentially flat (+1.2 percent)
over the period. Only Portage County experienced a decline in
volume (-14.6 percent) although this was on relatively solid
sales volume in Q4 2003.
Fourth Quarter Median Housing Price Data
Home prices in the fourth quarter of the year also
experienced significant growth according to the National
Association of REALTORS® report. As compared to Q4 2003, median
home prices were up 9.1 percent to $152,700, with all regions
enjoying price growth. "This is impressive price appreciation
and certainly driven in large part by high demand conditions in
the housing market" said WRA President William Malkasian. "While
appreciation at this rate is not sustainable every quarter, it
is certainly an indication of how important housing can be as a
way of accumulating and maintaining household wealth," said
Malkasian, who also noted that inflation has been in the
2.5 percent to 3.5 percent range over the past couple of years.
"The key to maintaining affordability when demand is high like
this, is to foster new construction," he added.
Median housing prices rose in all six regions of the state
when comparing Q4 2004 with the same quarter in 2003. Median
home price appreciation was in the 3.9 percent range in the
Central region; it was in the 6.1 percent-8.1 percent range in the
Northeast, North, West and South Central regions, and it was
12.3 percent in the Southeast region.
The Southeast region saw median housing prices rise
12.3 percent to $164,000 in 2004 as compared to Q4 2003. All
counties experienced solid housing price appreciation, with
Milwaukee County up 12.0 percent to $140,000. This was followed
closely by Washington (+11.3 percent to $196,900), Racine
(+11.2 percent to $142,000), and Walworth (+10.7 percent to
$169,200) counties. The other counties experienced median price
appreciation between 8 percent and 9 percent. Specifically,
Sheboygan median prices rose 9 percent to $127,400; Ozaukee
County was up 8.6 percent to $238,900; prices in Kenosha rose
8.1 percent to $154,700 and Waukesha County median prices
increased 8 percent to $242,900. It should be noted that the
strong price appreciation was accompanied by solid sales growth
in most of these counties, (especially Washington and Racine),
suggesting that demand is expanding faster than supply in those
areas.
The South Central region experienced price growth of
6.9 percent to $169,100 in the fourth quarter. Median prices in
Dodge County rose 21.2 percent to $132,00. It should be noted
that sales volume dropped slightly in the County over the
period, suggesting that higher prices might be hindering sales
volume. Other counties experienced more moderate price growth.
Specifically, median prices rose 10.3 percent to $169,100 in
Jefferson County, and they increased 9.6 percent in Grant County
to $96,200. Since sales volume was also up substantially in both
of these counties, this again is a suggestion that demand growth
exceeds the growth of supply in this County. The same can be
said for Green County, where median prices rose 7 percent to
$124,600 while sales were up more than 30 percent, and also Dane
County where median prices rose 7.6 percent to $204,500 on solid
increases in sales volume (+16 percent). Sauk County was up
7.7 percent to $140,000. Median prices rose 5.7 percent to
$154,500 in Columbia County, and they increased 5 percent to
$114,100 in Rock County. The only County to experience a decline
in the median sales price was Iowa County, which fell
38.9 percent to $116,000. It should be pointed out that this
discounting of median prices may have led to the very strong
growth in sales in the area.
The Western region of the state grew almost as fast as the
South Central region, with median prices increasing 8.1 percent
to $151,400 in Q4 2004 as compared to Q4 2003. Within the region
there was some variation, although all counties experienced
median price appreciation. Specifically, prices rose 17.8 percent
to $120,000 in the combined Buffalo/Pepin/Trempleau counties.
This increase may have deterred some buyers since home sales
fell nearly 13 percent over the period. Both LaCrosse County
(+16.5 percent to $132,900) and St. Croix County (+13.9 percent to
$207,100) experienced healthy growth in prices, but these
counties also experienced solid sales growth, again suggesting
relatively strong demand growth as compared to supply. Chippewa
County saw median prices rise 7.5 percent to $118,300 in the
fourth quarter of 2004 as compared to the same quarter in 2003.
Similarly, median prices rose 5.9 percent to $147,000 in Dunn
County; they rose 5.2 percent to $128,000 in Eau Claire and they
increased 3.8 percent to $174,300 in Pierce County.
The Northern region experienced solid price appreciation,
with median prices up 6.9 percent to $142,500. However, there
were substantial differences in appreciation rates across the
region. The strongest median price growth was in Langlade
County, where prices were up an astonishing 80.8 percent to
$124,000. It is likely that the mix of homes that sold in Q4
2004 in Langlade County were qualitatively different than those
that sold in Q4 2003, and hence we are not necessarily comparing
apples to apples in this particular instance. Lincoln County
also experienced solid price appreciation (+43.4 percent to
$120,000), and to a lesser extent, prices were up in Price
County (+13.7 percent to $77,300). While the same caveat
regarding the mix of housing is still possible, the fact that
home sales nearly doubled in both of these counties suggests
that there is relatively strong demand that is fueling these
price increases. In contrast, solid median price appreciation
seems to have stifled demand somewhat in Washburn County, where
prices increased 26.3 percent to $180,000, and this was
accompanied by a 22.2 percent reduction in home sales over the
period. Median prices rose 15.5 percent to $161,700 in Polk
County; they were up 11.1 percent to $160,000 in Oneida County;
and they increased 9.2 percent to $81,900 in Rusk County. Douglas
County experienced a 7.7 percent increase in median prices to
$140,000 on solid increased volume (+67 percent) again suggesting
relatively strong demand for housing in the County, whereas the
8 percent increase to $166,700 seems to have dampened demand
pressure in Sawyer County. Barron County was relatively flat
(-0.6 percent to $118,000), whereas four counties experienced
reductions in median prices. In two of those counties, price
reductions appear to have stimulated demand as sales volume rose
substantially over the same period (i.e., the combined
Ashland/Bayfield counties saw prices fall 10.4 percent to
$143,300; and median prices fell 4.4 percent to $138,600 in
Burnett County). In the remaining two counties, price reductions
accompanied reductions in sales volume, suggesting lower demand
pressures over time (i.e., Taylor County fell 5.8 percent to
$77,700 and Iron County dropped 10.5 percent to $170,000).
Finally, median prices in Vilas County fell 2.4 percent to
$200,000.
Median sales prices in the Northeast region were up
6.1 percent to $129,100 in Q4 2004 as compared to Q4 2003.
Several counties experienced double-digit increases in median
prices. Specifically, prices rose 19.6 percent to $165,000 in the
combined Door/Kewaunee counties. Growing nearly as quickly was
Fond du Lac County, where median prices rose $19.8 percent to
$117,300. Marinette County was up 17.9 percent to $82,500 on
solid increases in volume (+43 percent) suggesting that very
strong demand is serving to bid up sale prices in the County.
Green Lake County saw prices increase at a solid pace
(+11.2 percent to $118,600). Median prices increased 10.4 percent
to $107,100 in Waupaca, and 9.3 percent to $102,000 in Manitowoc
County. Both of these counties also experienced healthy
increases in sales volume. More moderate median price increases
were found in Outagamie (+6.2 percent to $135,000); Oconto
(+5.3 percent to $138,000); and Brown (+4.5 percent to $145,000)
counties. Median prices were up slightly in Calumet County
(+1.2 percent to $149,500), and Winnebago County (+1.1 percent to
$120,000). The only County to experience a reduction in the
median sales price was Shawano County, which slid 17.5 percent to
$95,700.
The region with the slowest median price appreciation was the
Central region, which saw median prices rise 3.9 percent to
$110,900 in Q4 2004 as compared to the same period in 2003. It
should be noted that median price growth in this region still
outpaced the rate of inflation over the period. Among the
counties in the region reporting sales activity, two experienced
healthy price appreciation. Specifically, median prices rose
9.4 percent to $125,000 in Portage County and they increased
8.6 percent to $88,200 in Wood County. Median prices were up
slightly in Marathon County (+1.8 percent to $124,300), but they
fell 7.6 percent to $77,500 in Clark County, and they dropped
more substantially (21.7 percent to $85,600) in Waushara County.
It should be noted that price discounting in Waushara County may
have contributed to the 22 percent increase in sales volume over
the period.
The Wisconsin REALTORS® Association (WRA) is one of the
largest trade associations in the state, representing more than
17,000 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 WRA and are not seasonally
adjusted. Median prices are only computed if the County recorded
at least 10 home sales in the quarter.
|
Printable Copy of this Press Release