Milwaukee area housing market has calmed a bit, but remains a seller's market
If you’ve gone through the process of buying a home in the past few years — or even simply tried to recently — you’ve seen that it is still very much a seller’s market and a difficult one for buyers.
High demand for houses partially sparked by the pandemic and low inventory has resulted in the average price for homes to skyrocket. The median price for a single-family home in Wisconsin is $275,000, according to a May 2022 Wisconsin Housing Report.
With inflation increasing and interest rates rising, many potential buyers are wondering if the affordability of houses will continue to be out of range this summer.
Tina Balaka, managing broker with Shorewest Realtors, and Courtney Stefaniak, a third generation realtor with the Stefaniak Group, break down the fundamentals of the Greater Milwaukee area's housing market.
Stefaniak points to lack of inventory and increased demand for homes. Balaka agrees that demand for homes is historically at an all-time high. "We felt the shortage when COVID hit, and it really just accelerated what we were seeing in the market of that lack of inventory, and the level of competition and the struggles that buyers have had to get a home is something that we have never seen before in our history of real estate," she says.
Certainly, sellers have been in a fantastic position with homes values growing at an unprecedented rate.
Stefaniak says listings are still seeing a rise in prices, but things have slowed down. "The interest rate spike has calmed things down slightly. It's still very competitive. It's still a seller's market, but it's not as chaotic as the beginning of this year or even last year where we were seeing 10, 15, 20, sometimes 30 offers on a property," she says.
Balaka adds, "We're starting to suddenly see some changes and the approach that buyers are able to take when they submit their offers, where before it was they were giving so much in order to get a house, they were waiving inspections, they were waiving testing, they were having appraisal gaps in their offers."
The shift is bringing contingencies back, which will kind of create a little more of a level playing field, says Stefaniak. But, she adds, we should not expect the economic situation or if a recession arises to cause a house market crash. "If more inventory came to market, we could absorb that inventory. We have enough buyer demand there to absorb extra inventory," says Stefaniak.
Balaka says we are years away from having that increased inventory and be back in balance. Right now, she says, they see listings last for a month, whereas generally they used to see a balanced market have listings last five to six months.
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