October 2018 Home Sales Report
Home Sales and Price Trends Continue into Fourth Quarter
Date: November 18, 2018
MADISON, Wis. — Rising prices and slower sales
fueled by inventory shortages continue to define Wisconsin's
housing market heading into the final quarter of the year,
according to the most recent market analysis by the Wisconsin
REALTORS® Association (WRA).
October existing home sales fell 2.2 percent compared to last
October, and the median selling price rose 5.1 percent to $182,500.
Through the first 10 months of the year, home sales also fell 2.2
percent compared to that same period last year, and median prices
were up 6.4 percent to $184,000.
"Inventories remain very tight statewide, and it's still a
strong seller's market in most regions of the state," said WRA
Board Chairman Jean Stefaniak. The state had 4.5 months of supply
in October, which is down from 5.2 months in October of 2017. There
was, however, some good news, as new listings were higher in
October after falling throughout much of the year, increasing 2.5
percent compared to October 2017. With demand high and supply low,
this remains a strong seller's market. Regionally, the Southeast,
South Central and Western regions had inventories ranging from 3.7
months to 4.1 months of supply in October, and they were in the 4.9
to 5.3 range in the Northeast and Central regions. The only area in
the state that is considered a buyer's market is the North region,
where there are 8.2 months of supply.
Stefaniak did note that buyers who have been unsuccessful during
the summer may want to consider the late fall and winter home
markets. "Nobody likes to move when the snow starts falling, but
sellers this time of year are frequently very motivated, which
could lead to some modest price concessions," said Stefaniak. Home
prices do follow the same general pattern as sales, ramping up in
the spring and summer, then falling to relatively lower levels
during the winter months. "Sales last winter were fairly strong,
suggesting a lot of buyers took advantage of price opportunities
during that time of the year," she said.
"Prices continued their upward trajectory and mortgage rates
also increased by just under one percent over the past year, so
affordability has definitely slipped," said WRA President & CEO
Michael Theo. The Wisconsin Housing Affordability Index shows the
fraction of the median-priced home that a buyer with median family
income can qualify to purchase, assuming 20 percent down and the
remainder financed using a 30-year fixed-rate mortgage. The index
fell from 219 in October 2017 to 196 this past October, which is a
10.5 percent reduction in affordability over the last 12 months.
"The strong economy has kept affordability from dropping further,"
said Theo. Median family income in the state is estimated to have
increased just over 5 percent since October of last year. "The flip
side of a strong national economy is that the Fed will likely
continue to hike interest rates, which will translate into higher
mortgage rates over the next year" he said. Rising prices and
rising mortgage rates will continue to put pressure on
affordability so considering a move in the winter may turn out to
be a good decision in the long run. "Using a REALTOR®
who is experienced and knows your local market is still the best
way to find the home that's right for your family's needs," said
Theo.