November Home Sales Up 23.8%
Market Highlights: Solid Sales. 3rd Month of 2016 With Positive Listings.
December 12, 2016 – Home sales in the Metropolitan Milwaukee housing market were up 23.8% in November. 1,463 homes sold in November compared to 1,182 in November of 2015. Comparing the numbers to 2014, sales were up 29.9% (1,126 in ‘14).
|4 County Area||1,182||1,463||23.8%|
November was the 9th month of 2016, and 4th consecutive month, in positive sales territory. The increase in sales can be attributed to the increase in listings in Milwaukee and Waukesha counties.
|4 County Area||1,329||1,396||5.0%|
The two main generators of real estate activity in the metropolitan area, Milwaukee and Waukesha Counties, saw solid increases in listings of 9.8% and 2.9%, respectively. However, inventory is still chronically low for the year. Including November, we have only had three months of positive listings in 2016.
As we have stated several times this year, there are two main reasons for the anemic level of listings in the market. One is that sellers are not feeling like their home has made up the value it lost during the recession. In other words, they are not feeling the “wealth effect” they had before the recession began in 2008.
A second reason is that there aren’t any homes for sellers to move into. An older suburban couple, for example, who wants to downsize to a condo in downtown Milwaukee, is hard pressed to find an available unit – delaying the sale of their current home.
Exceptionally “Tight” Inventory
As has been the case all year, inventory is very tight particularly for properties under $300,000.
The seasonally adjusted inventory level for all price points in November was 4.6 months, down from October’s 5.2 months. The seasonally adjusted level was 5.7 months in November 2015. Six months of inventory is generally regarded as a “balanced” market, in which sellers and buyers are evenly matched in price negotiations. If inventory goes below 6 months sellers often see higher prices from their REALTOR® recommended listing price, when the price of a property is bid up in offers and counter-offers.
Another way to look at inventory is by eliminating those listings that have an active offer on them, because most listings with an active offer continue through to a complete sale. Subtracting the 1,426 listings with an active offer from the 6,058 current listings, presents an effective inventory level of 2.8 months, again, down dramatically from October’s 3.2 month level. A year ago, the same calculation showed November’s inventory level at 3.8 months.
Where to go
Buyers should seek the counsel of a REALTOR® in determining their best housing options, and sellers need a REALTORS® expert advice in making correct marketing decisions with their home.
The Greater Milwaukee Association of REALTORS® is a 4,000-member strong professional organization dedicated to providing information, services and products to “help REALTORS® help their clients” buy and sell real estate. Data for this report was collected by Metro MLS, Inc. a wholly-owned subsidiary of the GMAR.
* Sales and Listing figures differ between the “Monthly Stats” and “4th qtr” (or year-end) because the collection of “Monthly Stats” ends on the 10th of each month; whereas the “4th qtr” is a continuous tally to 12/31. For example, if a sale occurred on July 29th, but the agent does not record the sale until November 11th, that sale would not be included in the July sales figures (or any subsequent month’s total) but would be added to the annual total sales figure in the “4th qtr” total.