Wisconsin Market Update: October

1. Sales and Price Trends

• Sales Decline: 8.7% fewer home sales over the past 12 months compared to the same period in 2023.
• Median Price: Up 6% year-over-year, reaching $310,000.
• Year-to-Date Sales: Up 3.8% compared to the first nine months of 2023.
• Year-to-Date Median Price: Increased 7.6% over the same period to $310,000.

2. Inventory Levels and Listing Trends

While both total and new listings improved slightly, the market remained tight:

• Months of Supply: 3.8 months, still below the balanced market benchmark of six months.
• Price Distribution:
  • Below $200,000: 18.2% of listings.
  • $200,000 - $349,999: 31.4% of listings.
  • Above $350,000: 50.4% of listings.

This limited inventory, especially in the lower price range, continues to challenge first-time buyers.

3. Affordability and Mortgage Rates

Falling mortgage rates and modest income growth improved affordability across the state:

• 30-Year Fixed Rate: Fell to 6.18%, 102 basis points lower than September 2023.
• Housing Affordability: Increased 5.7% year-over-year, easing some affordability pressures despite rising home prices.
• Median Family Income: Increased slightly by 0.5% over the past 12 months.

Expert Insights

Mary Jo Bowe, Chair of the Board of Directors, Wisconsin REALTORS® Association:
“Mortgage rates are more than a percent lower compared to this time last year, and this is the fourth straight month they’ve fallen since averaging a little over 7% last May. This has really helped improve affordability in the state.”

Tom Larson, President & CEO, Wisconsin REALTORS® Association:
“We did see an improvement in overall listings in September, but this is still a very challenging market for first-time buyers who are traditionally looking for starter homes at lower price points. There’s a lot of unmet millennial demand, which unfortunately will keep pressure on prices and further shrink the inventory of starter homes.”

Dave Clark, Professor Emeritus of Economics and WRA Consultant:
“The Fed’s actions in September to lower short-term interest rates by a half percent sent a clear signal that it was concerned that recession was a greater risk than inflation. While core inflation did uptick slightly in September, the Conference Board’s Leading Economic Indicator fell for the sixth consecutive month. The Fed’s upcoming meetings will determine whether further rate cuts are warranted.”

Conclusion

The real estate market in Wisconsin remains dynamic with rising prices, falling mortgage rates, and modest inventory gains. However, affordability challenges continue, particularly for first-time buyers seeking entry-level homes. With signals from the Fed hinting at possible economic challenges ahead, the market may face further changes in the coming months.

John Reuter

Integrity Homes 

608-669-4226

john@integrityhomewi.com