Here is a quick overview of the statewide real estate statistics for the month of December, courtesy of the Wisconsin REALTORS® Association. December 2022 home sales saw a steep drop of 34.9% compared to December of 2021, but this percentage doesn’t tell the whole story. 2021 brought one of the most active real estate markets in recent history, so a drop-off was expected at some point as those numbers couldn’t be sustained forever. The median home price sat at an even $250,000, which is actually a drop in price compared to $259,950 in November. This is a sign that the decline in house affordability across the state has started to temper the demand of buyers, which in the long run could lead to affordability returning to a reasonable level. Despite this, inventory levels remained low with the WRA estimating there was a 1.9 months supply of homes available in December. Surprisingly, this number was almost the same as December of 2021 when it sat at a 2 months available supply. These numbers still signal a strong sellers’ market, which will continue until the supply reaches the balanced market number of 6 months of available supply.
Joe Horning, Chairman of the Board of Directors for the WRA explains that the decreasing demand pressures could provide an opportunity for buyers in a market that has been tailored to sellers for the past couple of years. He says “The slide in affordability is really slowing demand pressure, and hence the rate of home price appreciation. The 5.5% annual rate of increase we saw in December was the slowest appreciation rate all year, and this cooling of price growth can be good news for buyers looking for bargains during the slower winter months.” If the market does continue to shift away from a very strong sellers’ market, buyers could expect to be able to purchase a home closer to their asking price without having to worry about the extreme bidding wars from previous months.
Source data provided by the WRA
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