MADISON, Wis. (WSAW) – Existing home sales in Wisconsin were down 6.2% in December 2023 compared to December 2022, according to the Wisconsin REALTORS® Association's December 2023 Wisconsin Real Estate Report.
The statewide median price increased 8.0% to $271,000, similar to the pattern seen throughout 2023. The number of new existing home listings in Wisconsin increased by 6.3% in December compared to the same month in 2022, which led to an increase in total home listings. Compared to the same period, it was 0.9%. This brings the total number of properties to 13,285 units, which is 0.9% above December 2022 levels.
Mary Jo Bow. The 2024 president of the Wisconsin Association of Realtors said winter presents opportunities for buyers.
“For the third month in a row, the number of new listings has increased year over year, and the number of total listings has also increased slightly,” she said. “Although it remains a strong seller's market, there is less competition during the winter months, which provides opportunities for buyers, and sellers who list their homes in the winter are often more motivated to sell.”
December sales were down 6.2% compared to December 2022 due to limited housing supply on the market.
Still, fourth-quarter sales were stronger than the first three quarters of the year. Sales for the fourth quarter of 2023 were only 4.3% lower than the fourth quarter of 2022, but for the first nine months of 2023 they were 21.1% lower than the same period in 2022.
Tom Larson, president and CEO of the Wisconsin REALTORS® Association, emphasized that continued advances in mortgage rates will improve affordability.
“It's good to see 30-year fixed mortgage rates below 7%,” he said. “While affordability is down compared to December 2022, it's likely to bottom out in August and September 2023. Since then, they have improved by about 13%. We hope that mortgage interest rates will continue to improve in 2024.”
Questioning whether the Fed is prepared to lower short-term interest rates, David Clark, professor emeritus of economics and WRA consultant, said: , decided to lower its inflation forecast for 2024 and keep interest rates unchanged. The committee also indicated that the federal funds rate could be cut by 75 basis points in 2024. This is good news, as the Fed is clearly becoming less concerned about the economy overheating and the resulting acceleration in inflation. We hope that this decline in inflation expectations will lead to further improvement in mortgage rates in 2024. ”
Report highlights:
- New listings for existing homes in Wisconsin increased by 6.3% in December compared to the same month in 2022, resulting in a 0.9% increase in total listings for the same period.
- Months of available supply improved by 25% over the past 12 months, but the market continued to favor sellers with just 2.5 months of supply in December. This is well below the six-month benchmark for market equilibrium.
- Due to limited housing supply on the market, sales in December decreased by 6.2% compared to December 2022. Fourth quarter sales were still stronger than the first three quarters of the year. Sales for the fourth quarter of 2023 were only 4.3% lower than the fourth quarter of 2022, but for the first nine months of 2023 they were 21.1% lower than the same period in 2022. Ta.
- Total existing home sales in 2023 were 17.5% lower than 2022 sales.
- Weak inventory levels in December pushed the median price to $271,000, an 8% increase compared to December 2022. Similarly, the median price for all of 2023 was 7.5% higher than the median price for 2022.
- Mortgage interest rates improved for the second consecutive month. The average 30-year fixed rate mortgage was 7.62% in October, 7.44% in November, and 6.82% in December. The December 2023 interest rate was approximately 0.5% higher than the December 2022 interest rate.
- Annual increases in mortgage rates and home prices have negatively impacted affordability, with Wisconsin's home price index dropping 9.7% between December 2022 and December 2023.
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