March 2020 Home Sales Report

Pre-coronavirus First Quarter Housing Market Strong

Date: April 20, 2020

MADISON, Wis. — The Wisconsin existing home market was on solid footing in the first quarter of the year and was on track to have strong sales in the spring and summer. That’s before the COVID-19 pandemic hit and severely constrained economic activity in the state. March home sales were strong, with closings of existing homes up 7.9% compared to March 2019, and median prices rising 12.2% to $207,500, according to the most recent analysis of existing home sales by the Wisconsin REALTORS® Association (WRA). This was the first time the March statewide median price exceeded $200,000, due in large part to the very tight inventory of homes for sale. There were just 3.6 months of available inventory in March, indicating a strong statewide seller’s market. On a year-to-date basis, comparing the first three months of 2020 to that same period in 2019, home sales rose 6.7%, and the median price rose 9.2% to $196,000.

“This report revealed the market had strong demand, pushing prices higher due to a limited number of homes for sale,” said WRA Chairman Steve Beers. He noted there were also promising signs with a slight improvement of new listings in March, rising 1.2% from the level 12 months earlier. “When the market starts to heat up, it’s always good to see a bump in new sellers listing their homes,” said Beers. “But that was ‘BC market — before-coronavirus,’” he said. Nearly all the homes that closed in March had signed contracts four to six weeks earlier, which was before the pandemic established a foothold in the U.S. “We’re in a completely different market now,” said Beers.

“We had a very strong start to 2020, which in most years would be a prelude to an even stronger peak housing market season in the spring and summer, but not this year,” said WRA President & CEO Michael Theo. The lockdown of much of the economy as a result of Gov. Tony Evers’ “Safer at Home” order has likely put the brakes on the housing market for at least the next few months. “It’s understandable that many buyers and sellers don’t want to risk exposure to the virus, and so they may put their plans on hold for the short-term,” said Theo. The WRA tracks daily the number of residential listings that are either canceled, expired or withdrawn from the market. From January 1 through March 13, which is the date the U.S. government declared a national emergency, a total of 60,560 units had been canceled, expired or withdrawn from the market. This compares with 54,690 units over that same time frame in 2019, which represents a 10.7% increase over the last year. “Fast-forward just one month, and we’ve seen a big spike in these withdrawals,” said Theo. If we look at the January 1 through April 15 period, the increase in cancellations, expirations and withdrawals this year compared to last year is now 22.2%. “The bottom line is that sellers are increasingly deciding to sit tight until the state lifts the order to stay home,” said Theo. 

On the bright side, Theo points out that technology offers several viable and safe options for buyers and sellers to remain engaged in the market. “There’s a lot of details online, and REALTORS® can set up virtual tours of listed homes so that potential buyers can evaluate a variety of opportunities available in this market without leaving their homes,” he said. Theo noted that once it is safe to move around, REALTORS® stand ready to start showing homes again. “We’ll ramp up very quickly once we get the all-clear,” said Theo.  

In the meantime, expect significant distortions in the monthly sales figures through much of the summer, according to David Clark, Marquette University economist and consultant to the WRA. “Even if we do have a quick economic rebound once the pandemic winds down, it will take time for the monthly sales figures to return to normal,” said Clark. He suggested that the lag between the signed contract and the closing will likely depress sales through at least mid-July. “There should be good opportunities when the housing market does normalize, with a moderation of the price appreciation and very low mortgage rates,” he said. 

Copyright 1998 - 2020 Wisconsin REALTORS® Association. All rights reserved.

Privacy Policy   |   Terms of Use   |   Accessibility   |   Real Estate Continuing Education