Sunday, October 21, 2018

Local Business

Home inventory dwindling in Wisconsin metro areas

Eau Claire County is among places where housing supply is getting low after strong buying season

  • Home-sales-through-3Q-2015

    Home sales and prices for the first nine months in the Leader-Telegram's readership area.

    Staff graphic

It’s been a strong year for home buying in Wisconsin — 2015 is on pace with pre-recession levels — and housing inventory in metropolitan areas, including Eau Claire, is declining.

Wisconsin Realtors Association figures released Monday show sales throughout the state in 2015 were up 12.6 percent from January through September compared with the first nine months of 2014.

“It was a great summer for home sales, and we seem to be carrying that momentum into the fall selling season,” K.C. Maurer, the association’s board chairman, stated in a news release.

If sales keep up their pace, the association projects there will be about 75,000 homes sold in Wisconsin this year. The last time sales were that high was 2005, when just more than 78,000 homes were sold.

“These are definitely relatively strong sales,” said David Clark, a Marquette University economics professor who does consulting work for the WRA.

However, Clark and the association’s leaders point to a dwindling supply of homes for sale in metropolitan areas as a potential concern.

“Our inventories have been getting really tight,” Clark said.

Statewide, there is an eight-month inventory of homes for sale, but that shrinks to six months in metro counties, with Dane and La Crosse counties having especially low available housing stock.

Of the 25 metro counties in Wisconsin, Eau Claire County is tied for the fifth-lowest inventory of available homes.

“Eau Claire only has 5.2 months of inventory,” Clark said. “That’s a very tight local market.”

Housing affordability remained steady between the first three quarters of 2014 and the same nine months of this year, based on the Realtors Association’s calculations. But Clark cautioned that declining inventory creates the realistic concern that prices will rise in areas with high demand and dwindling supply.  

Neighboring Chippewa County — also part of the Eau Claire metro area — had 7.5 months of inventory in September’s housing statistics. Rural counties in Wisconsin had an average of 13.4 months worth of unsold inventory, the association calculated.

Despite higher inventories in rural areas, Clark noted that sales are up in almost every county, indicating that the second-home market is heating up.

Last month’s home sales were up 11.1 percent over September 2014. The median home sold last month for $155,375, compared with $149,000 last year. That increase is a good thing for those interested in selling or staying put in their homes, WRA President and CEO Michael Theo said.

“This is of course excellent news for homeowners who have seen the asset value of their homes continue to rise over the last several years,” he stated in Monday’s news release.

Nearly 60,000 homes were sold through the end of September in Wisconsin — more than 6,000 more than during the same period last year.

About 78 percent of annual real estate activity typically occurs from January through September.

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