March 2011 Home Sales Still Looking for Norm
As anticipated, Dane County home sales for the month of March were well behind those of one year ago when the market was fully in the middle of the final Home Buyers Tax Credit. However, this year’s 335 sales are on par with the 332 sales reported in March 2009 – a market such as today that did not have a housing stimulus program in place. Median prices for the month
matched those of one year ago and are 3.5% above those in 2009.
Year-to-date, Dane County home sales are also behind the first quarter of 2010 but are 7% ahead of the first quarter of 2009. Median prices have remained rather steady over this time period: $203,712 (2011); 200,000 (2010) and $203,000 (2009).
As the market continues to adjust to the after-effects of the Tax Credit programs which heavily impacted the timing of sales in 2009 and 2010, new listings and total active listings continue to fall. The decrease compared to 2010 is much more pronounced than 2009 – which can be likely explained by the fact that last year many home sellers entered the market attempting to
lure the Tax Credit buyer. Even with the drop in active inventory, the Months Supply of Inventory remains on the high end at approximately 10 months combined for homes and condominiums, due to the smaller number of sales taking place. Many believe a Months Supply of Inventory in the 6 month range represents balance between buyers and sellers.
In the eight county region serviced primarily by the SCWMLS, Dodge, Grant, Green and Sauk Counties have shown solid sales figures compared to both 2010 and 2009. For the entire SCWMLS, first quarter sales are 7.1% behind 2010 but almost 9% ahead of 2009. New listings and total active listings also show a downward trend. Median prices for 2011 are trailing both 2010 and 2009 – and at this point it is hard to draw a conclusion as to whether this is because of a shift in the market range being sought by buyers or a sign of lowering prices.
In breaking down the March figures for Dane County between single family homes and condominiums, this year’s single family sales (255) trail both 2010 (294) and 2009 (274) totals with the median price ($217,328) very similar to 2010 ($219,950) and 6% ahead of 2009 ($205,087).
Condominium sales, on the other hand, were 80 in 2011, 86 last year and only 58 in 2009. Median prices have jumped around over this time, from $157,500 in 2011, down to $140,000 in 2010, back to $153,450 in 2009.
The most striking statistic is in total active listings – going from 2093 in 2009 to 1393 in 2011 – a 33% reduction over 2 years.
In spite of the market challenges of the past five years, a recent nationwide survey from the Pew Research Center shows 81% of the American public still agrees that buying a home is the best long-term investment a person can make. While they are not expecting a speedy recovery and believe it may take at least 3 years for home values to reach pre-recession levels, when
assessing the importance of four long-term financial goals, homeownership rated the highest along with being able to live comfortably in retirement (80% said these were extremely or very important). This compared to 73% for being able to pay for their children’s college education and 53% for being able to leave an inheritance to their children. Even renters – when asked if they would rather continue to rent or if they would prefer one day to buy a home – responded 81% that they would like to buy.
We will be examining these statistics in further detail over the next week in a series of blog posts. Until then, download our Market Update, our monthly examination of South Central Wisconsin’s residential real estate market. We believe this guide will be a useful tool for you, providing local statistics, industry insight, and buyer and seller tips.