Is Wisconsin poised for a turnaround in the real estate market?
If the recent results of a statewide public opinion poll are any indication, the answer may be “yes.’’
By way of background, Wisconsin home sales and median prices have been affected by national trends and both slipped during the third quarter compared with the same period a year ago, according to data from the Wisconsin Realtors Association. Existing home sales in the state fell nearly 17 percent in the third quarter compared with the third quarter of 2007 while median sale prices fell 5.3 percent to $160,000 statewide.
Nationwide, home sales fell approximately 8 percent during the period with the median sales price declining by 9 percent to $200,500.
Although leaders of the Wisconsin Realtors Association expect the fourth quarter and first half of 2009 to remain soft, sales are stabilizing in a number of markets. Among the counties that recorded third quarter sales increases while experiencing only minimal or no price declines: Grant and Lafayette in South Central Wisconsin; Pierce in the West; and Calumet and Shawano in the North East.
Meanwhile, according to the statewide Checkpoint public affairs survey, 70 percent of respondents agree it is a good time to be in the market to buy a home now. The survey of 400 Wisconsin residents was conducted Nov. 18-20 and contains a margin of error of plus or minus 5 percentage points.
Men appear to be more confident about prospects in the housing market than women, with 76 percent of men agreeing it is a good time to buy a home vs. 65 percent of women. Twenty-two percent of men and thirty-three percent of women worry it is a bad time to buy a home, while the remainder are unsure.
Interestingly, there is no statistically significant difference between the genders when it comes to perceptions about how Wisconsin’s economy is performing. Nearly 70 percent of both genders (69.8 percent men and 67.9 percent women) agree that things in Wisconsin “have gotten pretty seriously off on the wrong track.’’
When asked about the factors that would increase the likelihood of buying a home, the single most important item mentioned by respondents was a “significant increase’’ in take-home pay (identified by 27 percent; respondents were allowed to select up to three answers).
“Lower interest rates’’ ranked as the second most important factor that would increase the likelihood of buying a home (identified by 20 percent). It was followed by lower property taxes (16 percent); a more stable stock market (16 percent) and improvements in the health of the economy (15 percent).
On the income front, it appears that Wisconsin residents have been making some progress, although it remains to be seen how recent gains in household income will be affected once the full impact of the recession is taken into account. Through 2006-2007, median household income in the state increased by 7 percent to $52,218 from the levels of 2004-2005. That compares to an increase of 2 percent to $49,901 for the nation as a whole.
If at least a portion of these income gains can be sustained, the current lower mortgage rates sought after by the respondents may provide the support the state housing market needs to begin its recovery. Since mid-November, when the nationwide average for 30-year fixed rate mortgages reached 6.1 percent, rates have been heading downward.
— Sereno, former business editor of the Wisconsin State Journal, is a senior manager at Wood Communications Group in Madison. E-mail jenny.sereno@wcgpr.com or call (608) 770-8084.
