Home sales start year strong

First quarter highest in at least 12 years

Sales of existing homes in Wisconsin posted their best first quarter in at least a dozen years, the Wisconsin Realtors Association said Monday.

At the same time, prices continued to increase in what real estate professionals say is a thin inventory of homes on the market, especially in the state’s more-urban metro areas.

A strong March helped boost the first-quarter sales total to 13,376, up 3.2% from 12,958 in the first three months of 2016. In March, sales increased 7.2%, to 5,906 from 5,509 in March last year.

The median sale price of homes sold in Wisconsin through March this year was $159,575, or 6.4% higher than $150,000 in last year’s first quarter.

The Wisconsin Realtors Association said first-quarter existing home sales were the strongest for that three-month period in the state since the association recalibrated its system of tracking home sales in 2005.

“What is amazing about these record sales is that they are occurring against a backdrop of very tight statewide inventories,” Erik Sjowall, chairman of the Wisconsin Realtors Association, said in a statement.

Economist David Clark, a Marquette University professor who analyzes the monthly sales and price data for the state Realtors, said buyers seemed to have grasped the reality they must have their financial qualifications in order and should act quickly on a property they want.

“That behavioral change may be allowing us to see growth even though our inventory levels are getting really tight,” said Clark, who is executive associate dean at Marquette’s business school.

All regions of the state had monthly growth in sales in March.

“Tight supply combined with strong demand conditions is a recipe for higher prices, and that’s what we’re seeing moving into the spring and summer housing markets,” said Michael Theo, president and chief executive of the state Realtors organization.

Economic conditions point toward more consumers likely getting into the homebuying market. The statewide labor market continues to improve, with the March seasonally adjusted unemployment rate at 3.4%, the Realtors said. The unemployment rate has gone down even though the state labor force has grown over the last 12 months, which means job growth is more than keeping pace with the number of new job seekers.

However, housing affordability has fallen over the last year, mainly because of rising mortgage rates and climbing home prices.