Home sales in the metropolitan Milwaukee market were strong during the first quarter of the year, despite the seemingly never-ending problems plaguing potential buyers related to inventory.
During the first three months of 2018, 3,751 homes sold, an 8.6 percent increase over the 3,455 units sold in 2017.
March was the strongest March since 2006 when 1,663 homes sold. The 1,657 homes sold in March 2018 were 120 more than in March 2017, when 1,537 units sold.
“The metropolitan area has enjoyed a strong sales market since the beginning of 2015,” said Mike Ruzicka, president of the Greater Milwaukee Association of Realtors. “The influx of first-time buyers accounting for roughly 40 percent of the market, plus historically low interest rates, and a strong regional job market, all provide fuel for a hot market.”
There are no signs that the next quarter will slow down, Ruzicka said. The only thing holding back a higher volume of sales is the availability of homes for sale. And, there doesn’t appear to be any way to remediate that issue any time soon, Ruzicka said.
“The supply of homes for sale is not close to keeping up with demand. New construction, while much improved from the depth of the recession, is still lackluster,” Ruzicka said. “Foreclosures, which supplied thousands of homes after the recession began, have evaporated.”
Foreclosures are higher in Milwaukee, than in other cities, according to a recent report. But not enough to significantly increase inventory.
In order to have enough homes to meet current demand (to get to a 6 month level of inventory, which is considered ‘balanced,’) the market would need to add 4,591 units to the current supply, a 74 percent increase over the 6,159 current listings, according to GMAR.
Homes under $300,000 accounted for 76 percent of homes sold in March. Homes in good condition with a highly rated school nearby are selling in just a few days. Higher priced homes, over $300,000, are selling well, but in the typical 60-90 day time frame.
Every county in southeastern Wisconsin saw a decrease in listings in March, totaling 335 homes. The 4-county area dropped 309 units. Racine, Kenosha and Walworth dropped 26 units.
“People are not moving out of their existing homes for a variety of reasons, including: not having another place to move to, not feeling the value of their home has totally recovered, or they have made improvements to their existing home,” Ruzicka said.
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