The Milwaukee-area housing market is showing signs that it is cooling off, according to the Greater Milwaukee Association of Realtors.
Move-in ready homes priced below $300,000 and located in strong school districts are still selling quickly, but not as fervently as earlier in the year, said Mike Ruzicka, with GMAR.
Home sales in metropolitan Milwaukee were down 6 percent in the Milwaukee-area in September, according to GMAR.
“While the building blocks of the local economy and housing market are solid, there are some anecdotal reports of a cooling off in the market,” Ruzicka said. “Additionally, the number of communities defined as ‘hot markets’ (those with an increase in units sold, increased average sales price, and lower days on market) declined through the third quarter this year compared to the same period in 2017.
In 2017, there were 21 hot markets through the third quarter, this year there were only 13, according to GMAR. Most of the decline was due to a decrease in unit sales, possibly because of a lack of supply in the sub-$300,000 market.
Still, the third quarter of 2018 are still strong compared to the last decade. So far, 16,425 homes have been sold this year, down slightly, 0.2 percent, from last year. The totals through the third quarter for both 2017 and 2018 were the strongest this century. The next closest year was before the recession, in 2005, when 15,953 units sold, according to GMAR.
While new construction has improved since the recession, it is still lackluster, Ruzicka said.
“Foreclosures, which supplied thousands of homes after the recession began, have evaporated, and people are not moving out of their existing homes for a variety of reasons,” Ruzicka said.
In order to have enough homes to meet current demand the market would need to add 3,500 units to the current supply, which is a 50 percent increase over the 6,897 current listings in the market, Ruzicka said.
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