Lack of inventory remains a drag on state home sales
Demand is driving median price higher
Sales of existing homes in Wisconsin are down almost 3 percent for the year, while prices are up nearly 7 percent.
The key reason for both, according to residential real estate professionals: A stubborn shortage of good properties on the market.
“Inventory weakness has been the story all year long, and it continues to hold back statewide sales with no indication of improvement in the near term,” Jean Stefaniak, new chairperson of the Wisconsin Realtors Association, said in a statement Monday.
Through September this year, 63,264 homes were sold in the state. That’s 2.7 percent fewer than the 64,998 during the first nine months of 2017.
At the same time, the median sale price in the state rose 6.9 percent, to $184,900 from $173,000.
The month of September saw a 12 percent drop in sales from September last year, to 6,881 from 7,818.
The greatest demand is for homes costing $350,000 or less, the Realtors organization said.
Although home buying in Wisconsin remains affordable by national standards, the ability to buy a house is shrinking as mortgage rates rise, the Realtors said.
The average interest rate on a 30year fixed-rate mortgage is up almost one percentage point from a year ago, according to a weekly survey by mortgage buyer Freddie Mac.
In the week ending Oct. 18, Freddie Mac found that the average 30-year fixed mortgage rate was 4.85 percent, with 0.5 points. That compared with 3.88 percent at the same time in 2017. A point equals 1 percent of the mortgage amount.
“The strong appreciation in prices has been consistent throughout the year,” Michael Theo, president and chief executive officer of the Wisconsin Realtors Association, said in the group’s September report. “It’s a predictable outcome given the very strong demand for housing combined with limited supply in the state.”