Date:  August 15, 2007

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

Madison - Wisconsin home sales moderated in the second quarter of 2007 according to recent figures released by the Wisconsin REALTORS^® Association. Existing home sales in the state fell 7.2 percent in the second quarter of 2007 relative to that same quarter last year, yet this outpaced the nation, which fell 10.8 percent over the period, as well as the Midwest, which dropped 8.4 percent. In addition, unlike some regions, the median price of a home in Wisconsin remained slightly above the level of last year, increasing 1.2 percent to $168,000. “There is no doubt that Wisconsin’s housing market has softened this year, but we have maintained prices and we are weathering the changes in the lending markets better than many states,” said WRA Chairman Roger Rushman. He added that many of the market fundamentals give reason for optimism for the balance of the year. “There was slight growth in jobs over the period and even though 30-year fixed rate mortgage rates have inched up in the last three months, they remain in the 6.7 percent range which keeps housing affordable for new buyers,” he said.

Second Quarter Regional Sales Data
 

Comparing the second quarter of 2007 with the same quarter last year, existing home sales fell in every region in the state, although the regional decline varied somewhat. Specifically, home sales were down just 1.9 percent in the Northeast region, while they fell between 5.5 percent and 5.8 percent in the Western and South Central regions. Existing home sales were down 8.1 percent in the Central region of the state, and they slid 10.9 percent in the Northern region, which tends to be somewhat volatile as a result of the concentration of secondary homes in some areas. Finally, home sales fell 12.8 percent in the most heavily populated region, the Southeast.

The Northeast region was down a mere 1.9 percent in the second quarter of 2007 as compared to Q2 2006. Within the region, there was substantial volatility, with about half of the counties up or unchanged in volume, and the remainder down by modest to more substantial margins. The strongest growth was seen in Green Lake County, where existing home sales rose 45.7 percent on significant initial volume. Also up by solid margins were Calumet County (+13.8 percent) and Manitowoc County (+11.7 percent), again building off of substantial home sales in the second quarter of 2006. Much more modest increases were seen in three counties. Specifically, home sales rose 2.9 percent in Oconto County; they increased 2.7 percent in Outagamie County, one of the three most populous counties in the region; and they increased 2.1 percent in neighboring Waupaca County. Home sales were unchanged in both Marinette and Kewaunee counties, while they fell 6 percent in Brown County, the largest county in the region. They dropped 7 percent in Fond du Lac County over the period, and fell 7.6 percent in Winnebago County. Double-digit declines were seen in two moderately sized counties: Shawano County (-16.5 percent) and Door County (-21.2 percent). While the largest decline was found in Menominee County (-41.7 percent), this was based on only five fewer sales in Q2 2007 as compared to Q2 2006.

The Western region of the state saw its sales volume fall by a modest 5.5 percent in the second quarter of 2007 as compared to that same quarter in 2006. Up substantially were the counties of Buffalo, Pepin and Trempeleau (+55.3 percent), which are combined in their sales reporting. Note that this is an increase of 26 units over the period. Two counties were up slightly – Pierce County (+4.7 percent) and Eau Claire County (+1.2 percent). Dunn County was unchanged between Q2 2006 and Q2 2007, and Chippewa County was down only slightly (-0.9 percent). However, La Crosse County dropped 10.8 percent over the period, and St. Croix County, which has seen very robust growth in recent years, cooled 20.8 percent in the second quarter of 2007 as compared to Q2 2006 on solid initial sales volume.

The South Central region also fell modestly in the second quarter of 2007, dropping 5.8 percent below the Q2 2006 level. The strongest county growth was in the far western part of the region. Specifically, Grant County increased its sales volume substantially, rising 24.2 percent. Also strong was Jefferson County, which grew 9.1 percent over the period. Jefferson County borders the rapidly growing western suburbs of Milwaukee, and the eastern suburbs of Madison. Also up was Crawford County (+5.6 percent), although that was just one additional home sale over the period. All other counties were down by moderate to substantial margins. Down by a modest degree was Dane County (-3.8 percent), the largest county in the region, followed closely by Columbia County (-3.9 percent), which is just north of Madison. Rock County volume fell 4.9 percent over the period. Interestingly, Sauk County, which is northwest of Madison and neighbors Columbia County, was down 22.6 percent on sizeable initial volume. Also down by double-digit margins were Lafayette County (-12.5 percent), Green County (-16.1 percent), Dodge County (-19.4 percent), Richland County (-45 percent) and Iowa County (-59.5 percent), although the latter two counties are relatively small rural counties with only modest volume in either year.

Within the Central region of the state, existing home sales dropped 8.1 percent, with most counties down from their Q2 2006 sales volume. While Adams County grew 50 percent, this was an increase of just five home sales over the period. Likewise, Juneau County fell 100 percent, reporting one fewer sale in Q2 2007 than the same period last year. The largest county in the region, Marathon County, fell a mere 1.8 percent over the year, and another large county, Portage County, was down 4.1 percent. Clark County lost four sales (-12.1 percent), and Waushara County lost 14 sales (-14.9 percent). Finally, existing home sales were down 20.5 percent in Wood County, which borders Wausau to the south, on initial sales volume of 278 units.

Existing home sales fell 10.9 percent in the Northern region of the state in Q2 2007 relative to Q2 2006. As has been the case in recent years, there was considerable variability within the region. This is undoubtedly due in part to the fact that there is a strong mix of primary and vacation homes in the region. Two counties saw their sales volumes rise by double-digit margins. Forest County sales volume increased 20.7 percent, and Douglas County grew 18.5 percent, although both counties had modest sales in the second quarter of 2006. Sales were up 7.2 percent on somewhat larger initial sales volume in Lincoln County just north of Wausau, and they were unchanged at three sales in Florence County. Sales dropped slightly in Polk County (-1.9 percent), which borders Minneapolis to the northeast, and they fell 2.3 percent in Washburn County. Sales in Burnett County were down 5.4 percent, and they were off the Q2 2006 pace by 6.5 percent in Barron County. All other counties fell by more than 10 percent. These include Vilas County (-10.7 percent), Ashland and Bayfield counties, which are combined for reporting purposes (-13.8 percent), Sawyer County (-14.1 percent), Rusk County (-15.2 percent), and Oneida County (-16.9 percent). Also down by sizeable margins were Iron County (-20.9 percent), Price County (-29.4 percent) and Langlade County (-31.7 percent).

Finally, home sales in the Southeast region fell 12.8 percent from the levels established in the second quarter of 2006. All counties in the region experienced some decline in sales volume, with most falling more than 10 percent. The exceptions were Washington County, which dropped 7.2 percent, and Waukesha County, which fell 9.8 percent. Slightly higher reductions were seen in Racine County (-10.5 percent), Kenosha County (-10.8 percent), Sheboygan County (-11.6 percent) and Walworth County (-12. 2 percent). The two counties that experienced the largest reduction in sales volume were Milwaukee County (-15.9 percent) and Ozaukee County, which slid 16.1 percent over the period.

Second Quarter Median Housing Price Data

Median home prices in the second quarter rose a modest 1.2 percent to $168,000, according to the REALTORS^®’ report. This was similar to the 1.1 percent increase seen in the first quarter of the year. Across the state, median prices increased in five of the six regions and were unchanged in one region. “Despite the decline in home sales statewide, there remains no evidence of a Wisconsin housing bubble,” said WRA President William Malkasian. “Even though conventional 30-year mortgage rates have inched up almost 0.5 percent in the last two months, they remain around 6.7 percent, which is low by historical standards,” said Malkasian. “Given the overall health of the economy in the state, this is a good time to get into the market, especially for first time buyers,” he noted.

The Central region saw its median prices grow 4 percent to $126,200 in the second quarter of 2007 as compared to the second quarter last year. While the median price jumped a substantial 82.7 percent to $255,800 in Adams County, it is important to note that this is on just 15 sales, as compared to 10 sales last year. This price jump certainly reflects in part a change in the mix of homes that sold in Q2 2007 as compared to Q2 2006. That is, it is likely that the median priced home in the most recent quarter was qualitatively bigger, or in a more desirable location than the median priced home that sold in Q2 2006. Also up by a solid margin was Wood County, where the median price rose 12.5 percent to $108,000. Note that home sales in Wood County also fell substantially, suggesting that the reluctance to lower prices may account for the lower activity levels. Also up was Portage County, where prices rose 6.3 percent to $136,000, although the volume was only slightly off the 2006 pace. In Clark County, the median price rose 3.7 percent to $81,400, and prices were flat in the largest county in the region, Marathon County, where they increased just 0.4 percent to $134,300. The only county that experienced a reduction in the median price was Waushara County, where prices fell 8.5 percent to $111,400 even as volume dropped nearly 15 percent, suggesting some softness in that market.

Median prices rose 3.6 percent to $128,900 in the Northern region. As has been the case in the recent past, there has been substantial median price volatility within the region resulting from the mix of primary and secondary homes in the region. As the mix of homes sold changes from quarter to quarter, median prices can adjust dramatically. For example, four counties saw they median prices rise more than 20 percent. The largest increase was in Price County where median prices increased 38.2 percent to $92,200 over the period. Similarly, they rose 35 percent to $180,000 in Burnett County, 23.4 percent to $83,300 in Iron County, and 20.4 percent to $127,500 in the combined counties of Ashland and Bayfield. All of these counties experienced modest to significant reductions in existing home sales volume during the second quarter of 2007 relative to that same period in 2006. As was the case in the Central region, the majority of the price differences are due to a change in the mix of homes sold in these communities, rather than substantial price changes on homes of similar quality. More modest increases were seen in Lincoln County (+8.2 percent to $95,000), Forest County (+6.6 percent to $89,100), Vilas County (+1.8 percent to $140,000), and Polk County (+1.6 percent to $162,500). Two counties were essentially unchanged and two others dropped moderately. Specifically Langlade County was down 0.4 percent to $73,300 and Washburn County dropped 0.8 percent to $154,300 whereas Oneida County fell 2.5 percent to $115,000 and Barron County was down 4.2 percent to $124,600. Finally, more substantial reductions were found in Sawyer County (-18.3 percent to $152,500), Douglas County (-21 percent to $140,000) and Rusk County (-21.4 percent to $88,600). Again, changes in the mix of homes sold almost certainly accounts for the majority of these median price changes.

The Southeast Region was up 2.4 percent to $188,900 over the Q2 2006 to Q2 2007 period. Recall that sales volume fell throughout the region. For Sheboygan County, the median price rose 12.9 percent to $146,000, but for all other areas the changes were much smaller. For example, the median price in Racine County was up 5.5 percent to $165,000, and it was up 2.4 percent to $202,500 in Walworth County and 2 percent to $165,700 in Milwaukee County. The median price in Kenosha County rose slightly (+0.9 percent to $173,300) and it was down slightly in Washington County (-0.6 percent to $209,100). Finally, moderate reductions were found in Waukesha County (-3.4 percent to $252,800) and Ozaukee County (-4.1 percent to $250,000).

The South Central region experienced an increase in the median price of existing home sales of 1 percent to $183,600 over the period from Q2 2006 to Q2 2007. Substantial median price increases were seen in two relatively small counties, which incidentally also saw their sales volume fall dramatically. Median prices in Richland County were up 59.5 percent to $123,600, and they were up 23.5 percent to $163,000 in Iowa County. Note that sales volume in both of these counties in the second quarter of 2007 was no greater than 15, so small changes in the mix of homes sold could cause median prices to change substantially. The remaining counties saw much smaller changes in the median price. In positive territory were Dodge County (+5.9 percent to $138,700), Rock County (+1 percent to $132,000), Dane County (+0.9 percent to $214,000), and Columbia County (+0.4 percent to $162,200). Median prices were unchanged in Crawford County at $110,000. On the negative side, median prices over the period dropped by moderate margins in Sauk County (-2.2 percent to $158,200), Grant County (-2.9 percent to $97,100), Jefferson County (-3.2 percent to $166,200), and Green County (-5 percent to $136,000).

In the Western region, median prices were essentially unchanged, rising 0.3 percent to $153,800 in the second quarter of 2007 as compared to the second quarter of 2006. Furthermore, no county experienced a double-digit change in the median price over the period. The median price increase was largest in Eau Claire County, where they rose 7.3 percent to $137,100 even as the sales volume increased slightly. Also up were La Crosse County (+3.1 percent to $150,700) and Chippewa County (+2.5 percent to $135,000). Median prices were flat in the combined Buffalo, Pepin and Trempealeau counties (-0.5 percent to $103,500) and they fell by similar margins in the eastern Minneapolis suburban counties of St. Croix (-5.3 percent to $196,400) and Pierce (-6.1 percent to $180,000). Finally, Dunn County saw its median price fall more substantially (-9.8 percent to $134,100) even as its sales volume remained unchanged between Q2 2006 and Q2 2007.

Finally, the median price in the Northeast region remained unchanged at $135,400 between the second quarter of 2006 and the second quarter of 2007. However, five of the counties experienced double-digit increases in their median price, with the largest increase in Oconto County (+16.7 percent to $140,000), followed by Shawano County (+14.7 percent to $130,000), Kewaunee County (+13.7 percent to $108,000), Marinette County (+12.5 percent to $90,000) and Manitowoc County (+10.1 percent to $107,300). Interestingly, only one of those counties (Shawano County) saw its sales volume fall over the Q2 2006 to Q2 2007 period, with the remaining counties either flat or up from the levels of Q2 2006. Four counties saw their median prices remain very close to their Q2 2006 levels, including Winnebago County (+0.5 percent to $130,000), Outagamie County (unchanged at $137,300), Brown County (-0.7 percent to $152,300) and Calumet County (-0.9 percent to $161,500). Also down was Fond du Lac County, which fell 1.7 percent to $125,000. Down more substantially was Green Lake County (-7.4 percent to $107,600) and Waupaca County (-7.7 percent to $105,700). The largest median price reduction of the period was found in Door County, where the price fell 12.7 percent to $203,600. Given the large number of second homes and condominiums in Door County, wide swings in the median price resulting from a change in the mix of homes sold are not uncommon.

The Wisconsin REALTORS® Association is one of the largest trade associations in the state, representing over 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 Wisconsin REALTORS® Association and are not seasonally adjusted. Median prices are only computed if the county recorded at least 10 home sales in the quarter.

Wisconsin Housing Statistics Online
 

Printable Copy of this Press Release
Comparison from 2006 and 2007 Spreadsheet

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