While home inventory levels in Dane County remain limited, “the picture is looking brighter” for the local housing market as sales are on the rise.
That’s according to the latest market analysis from Madison-based Stark Company Realtors CEO David Stark, who says both buyers and sellers are now “coming to accept the reality” that home mortgage rates will be in the 6% range for the foreseeable future.
That’s the largest driving factor for more homes being sold in the county, Stark wrote, noting it had 8.4% more residential closings in the second quarter compared to the same period of last year. On a year-to-date basis, the increase is 6.5%.
“June was a particularly active month, with Dane County closings up 19% from June of last year,” he wrote. “What’s nice about this is that it’s happening without any assistance from mortgage rates.”
Stark says the “healthy” acceptance of the new mortgage rate status quo was expected. And while the market hasn’t returned to the pre-pandemic state, he argues “it’s moving in the right direction” as it rebalances to meet the current environment.
“It will take time, but we have no doubt that we’ll get there,” he wrote.
Meanwhile, the county’s inventory levels have been seeing slow improvement year over year.
The low point came in 2023 when Dane County had just 511 available homes at the start of the third quarter. At the same point this year, that has more than doubled to 1,027, according to the report. But that remains below 2019 when the total was 1,242.
Growth in this measure has been slow this year, with total residential inventories rising just 6% over the year at the start of the first quarter, while single-family options had fallen 3.6% over the same period.
More recently, Stark notes the pace of new listings has accelerated with an increase of 7.9% over the year in July. But this growth is playing out amid “extremely low” inventories by historical standards, he wrote. As a result, most listed homes are selling, and many of these are going quickly.
The trend of rising sales helps explain why inventory growth has been slow in the county.
“Both buying and selling activity have improved this year, and as buyers come to the market in greater numbers, inventory is struggling to accumulate, even with more new listings,” Stark wrote. “New listings are simply selling too quickly for inventory to accumulate.”
