WRA report shows improvement in home listings decline

While statewide home sales and listings were still down year-over-year in September, the latest Wisconsin Realtors Association report shows some areas of improvement. 

WRA Board of Directors Chairman Joe Horning notes the annual decline in new home listings was below 4% for the second month in a row — a “significant improvement” from recent trends where the decline was more steep. 

“Now we’re starting to see promising signs for total listings as well, which had the lowest annual reduction in total listings in nearly two years,” he said in a statement. “Hopefully these supply trends continue.”

Despite the positive trend in the new listings figures, the number of active listings fell 7.2% over the year in September, from 19,685 to 18,275. 

Over the same period, monthly home sales were down 18.4%, falling from 7,602 in September 2022 to 6,205 last month. That trend and other factors have driven up the median home price in Wisconsin by 9.3% over the year, from $270,000 to $295,000. 

At the same time, inventory levels saw a 17.9% improvement over the year, increasing from 2.8 months of inventory to 3.3 months. But WRA says supply overall “remains very tight,” as the state would need to see a 77% increase in listings to get back to a balanced market. 

WRA President and CEO Michael Theo noted in the report that mortgage rates are the highest they’ve been since late 2000, keeping many first-time buyers from purchasing a home. Mortgage rates averaged 7.2% last month, compared to 6.11% in 2022 and just 2.9% in 2021, the report shows. 

“This means our available supply goes further, which is why our months of inventory have improved slightly,” Theo said. “But we still have a long way to go before millennial demand is met and the housing market becomes balanced.”

Meanwhile, Marquette University Professor Emeritus Dave Clark said major housing price “corrections” — like those seen during the Great Recession — are unlikely given the current scenario. Clark is a consultant for the state realtors group. 

“We’re in a much different situation now,” he said in the report. “Although rising home prices and rising mortgage rates have pushed affordability to record-low levels, there is very little chance we will see a similar price correction in this market.” 

See the full report: https://www.wra.org/HSRSep2023/  

Listen to a WisBusiness.com podcast with Clark: https://www.wisbusiness.com/2022/wisbusiness-the-podcast-with-dave-clark-marquette-university/ 

–By Alex Moe