Housing Information for the State of Wisconsin

Monday, July 24th, 2023 -- 11:01 AM

(Jeff Boller, Marshfield News Herald) The ongoing shortage of homes for sale in most markets and higher mortgage interest rates combined to push June sales down 19.7% and the median sale price up 8.6% to $304,000, according to Wisconsin Realtors Association data released Thursday.

The statewide median price for the first half of 2023 still remains below the $300,000 mark. It's now $280,000, up 7.7% compared to the first half of 2022. Conditions amount to a perfect storm of affordability, said WRA President and CEO Michael Theo.

Statewide existing home sales dropped close to 20% in June and many metro areas saw double-digit drops in line with the state, according to WRA data. In the first half of 2023, existing home sales fell from 37,503 in 2022 to 28,205, a 24.8% decline.

Median list prices indicate the midpoint of all current home prices in a region or market. It's a gauge for what buyers will find available on the market, but homes will sell for less and more than what sellers ask for.

The median sale price in June for Wisconsin homes for sale remained $375,000, unchanged from May, according to Realtor.com’s housing inventory data. For context, the statewide median list price was $188,800 in July 2016 when Realtor.com began to track median list prices.

The average interest rate on 15- and 30-year fixed-rate mortgages as of July 20 was 6.06% and 6.78% respectively, according to mortgage lender Freddie Mac. For comparison, one year ago, the 15-year rate was 4.67% and the 30-year rate 5.51%.

The 15- and 30-year mortgage rates peaked at 6.38% and 7.08%, respectively, in November 2022. Prior to November, the last time the 30-year mortgage rate topped 7% was April 2002. Inventory, measured in months, gauges the number of homes for sale at a given time based on the pace of home sales in a market or region.

Inventory helps determine whether the housing market favors buyers (more than six months of inventory), sellers (less than six months) or is balanced (right around six months). Statewide, inventory increased to 3.1 months compared to June 2022.

Wisconsin overall, but especially major metro areas like Milwaukee, Madison and Green Bay, strongly favor sellers. The state would need to nearly double the current number of homes on the market to balance out the demand between buyers and sellers.

Buyers searching for lower-priced homes face more competition and the tightest market conditions. There are about 4,000 properties for sale in Wisconsin for less than $200,000, 22% of all homes on the market.

Buyers purchased 21,500 sub-$200,000 homes in the prior 12 months, 31% of all sales. Inventory relief generally comes from an increase in new listings, but new listings declined 24.2% to 8,368 in June. For comparison, there were 8,700 home sales and 11,000 new listings in June 2022.

Last month, there were 7,000 home sales and only 8,300 new listings. New home construction can also provide some relief when inventory is in short supply, though the current cost of materials and labor makes it difficult to build housing in affordable price ranges, for example below $300,000.

Wisconsin Builders Association and U.S. Census Bureau residential building permit data indicates the pace of new home construction has increased since 2019, but remains well below the levels of residential construction, both single- and multi-family, seen in the 1990s and 2000s.

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