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Wisconsin Housing Market Remained Hot In April
By: Fainting Goat
The Wisconsin existing home market continued on a solid growth path in April with strong sales and significant upward pressure on prices. Home sales rose 8.8 percent in April 2016 compared to that same month in 2015, making April 2016 the strongest April sales volume since 2005. This sales pace helped push statewide median prices to $161,622, which is 4.9 percent higher than April 2015. "Housing demand is strong due to a growing economy and low interest rates, whereas housing supply continues to be tight statewide," said WRA President & CEO Mike Theo.
The Wisconsin unemployment rate fell to 4.4 percent in April, which is substantially lower than the 7.1 percent rate that existed in April 2012. The 30-year fixed-rate mortgage was at 3.61 percent in April, which is actually lower than the 3.91 percent rate in April 2012. In contrast, the supply side of the market is especially tight, and it tightened further in April. There were 6.7 months of available supply in April, which is down from 8.5 months this time last year. "What's even more concerning is the fact that new listings are also down, suggesting that buyers are going to need to move quickly when they find a house they want to buy," said Theo.
"Thankfully low interest rates and modest family income growth have combined to keep housing affordable in the state," said Theo. "The big question is whether the Federal Reserve plans to start raising short-term rates again, which could put upward pressure on mortgage rates," said Theo. The most recent meeting of the Federal Open Market Committee, which is the Fed's rate-setting body, hinted at a rate increase as early as June this year. "Mortgage rates have been stable for a long time, but when they start rising, that will hurt affordability, so time is probably not on the buyer's side," said Theo. "Getting prequalified for financing and working with an experienced REALTOR® is still the best way to be successful in a tight market," he said.
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