2011 November Home Sales Report
Home Sales Continue to Grow as Median Prices Moderate
Date: December 19, 2011
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“We are definitely closing out the year on a strong note,” said Rob Keefe, Chairman of the WRA Board of Directors, noting that the seasonal pattern of home sales typically slows as winter approaches. “The strong market of the last few months has pulled sales in 2011 nearly even with the 2010 level,” he said. Keefe noted that year-to-date home sales through the end of November are now less than 1 percent below last year, and that is without any bump from the federal government to stimulate existing home sales.
Home sales were up in four of the six regions of the state, with three of the six regions seeing their November home sales grow more than 20 percent. The strongest region in the state was the North where sales rose 27.7 percent over November 2010. This was followed by the South Central region, which was up 25.2 percent, and the Southeast region, up 21.4 percent. The Northeast region was up a solid 7.9 percent, whereas November existing home sales fell 5 percent in the Central region and were down 6.6 percent in the West compared to November sales last year.
The statewide median price of existing homes fell 2.2 percent in November compared to November 2010, and year-to-date, median prices fell 6.1 percent. “This is clearly a buyer’s market, and while inventories are down from October, they still remain high at more than 14 months,” said WRA President and CEO Michael Theo. “This means buyers will be in the driver’s seat for the foreseeable future.” Regionally, there was some volatility with half the regions showing median prices down: the Southeast down 9.7 percent, South Central down 2.6 percent and the Northeast down 4.8 percent. The Western region was essentially flat, and median prices in the North and Central regions were up 7.3 percent and 15.8 percent, respectively.
“The economy did get a little good news in November with an improvement in the national unemployment rate and even an uptick in consumer confidence and consumer expectations,” said Theo. The national unemployment rate improved to 8.6 percent in November, and the Wisconsin unemployment rate has also been trending downward recently. In addition, the Conference Board’s Consumer Confidence Index improved, as did their Leading Economic Indicator Index due in part to better consumer expectations. “These are both positive signals on the economy, but they are very preliminary and it will take sustained improvements, including significant job growth, before many homebuyers are comfortable diving back into this market,” said Theo. “However, if these trends continue, new buyers will be greeted with very affordable housing in the state, with Wisconsin housing among the nation’s best values.”
The WRA’s report showed that the November WRA Housing Affordability Index was at 242, meaning that the family with median income can afford to buy 242 percent of the median-priced home in the state, given current 30-year fixed-rate mortgage rates and a 20 percent down payment. Comparing Wisconsin’s index with a recent National Association of REALTORS® Affordability analysis, Wisconsin housing was found to be more affordable than the U.S., where the index was just under 200, as well as all of the four broad census regions, especially the Northeast where the index was 163 and the West where the index was 165. “We’ve always known that you get a lot of home for your money in Wisconsin, and that is especially true in this market,” said Theo.