But finally, there are signs that the housing markets in Wisconsin and the metro Milwaukee area are improving and shifting to a more balanced position between buyers and sellers.
Three bright signs to note for the state and local housing market:
- The number of homes sold in Wisconsin have increased for 10 consecutive months, year-over-year.
- Home sale prices in the state increased in March and April (the most recent data available), year-over-year, the first home price increases in the state since late 2010.
- The inventory of homes for sale in the metro Milwaukee area has fallen to about 8.5 months, close to a balanced market.
Statewide, home sales rose 19.5 percent in April, compared to April of 2011, according to the Wisconsin Realtors Association (WRA). It was the 10th consecutive month of double-digit sales growth in the state.
In the metro Milwaukee area homes sales were up 44.2 percent in April, according to the Greater Milwaukee Association of Realtors (GMAR).
"After several years of a stagnate housing market, it's encouraging to see sustained growth in homes sales, especially as we enter the summer, which is the prime season for home sales in the state," said Rob Keefe, chairman of the WRA board of directors. "We've been hearing from Realtors throughout the state that homes have been moving at a brisk pace, which bodes well for a strong summer of home sales."
The higher sales levels are lowering inventory levels, bringing the market more into balance. In April there were 13,157 active listings in the MLS in the Milwaukee area, according to GMAR. As a result there was 8.5 months of inventory (the time it would take to sell all of the homes on the market), a dramatic decline from 10.2 months in March, 14.6 months in February and 15.4 months in January.
A balanced market is generally considered a supply of about 6-8 months. A supply of greater than 8 months is generally considered a buyer's market and a supply of less than 6 months is considered a seller's market.
"Inventory has gone down," said John Horning, executive vice president of Brookfield-based Shorewest Realtors. "This is leading to some situations where we have multiple offers on a property. In some cases buyers are making offers above asking price. That's something we haven't seen in four years. Buyers are starting to find out they have to have a little more sense of urgency. Well maintained homes that are priced correctly are not sitting on the market very long."
Much to the relief of sellers, there are some signs that the increased home sales and lower inventory levels are finally resulting in higher prices. Home prices in the state increased 2.4 percent in April, the second consecutive month of home price increases in the state.
Home prices in the southeastern Wisconsin region are still falling and were down 1.6 percent in April, according to the WRA. But four counties in the eight-county region had price increases in April:
- Sheboygan, $117,500, up 14.5 percent
- Racine, $114,500, up 9.0 percent
- Waukesha, $215,000, up 2.1 percent
- Walworth, $151,500, up 1.3 percent
But four counties in the region still had home sale price declines in April:
- Ozaukee, $207,500, down 13.5 percent
- Milwaukee, $89,950, down 5.3 percent
- Kenosha, $111,713, down 5.3 percent
- Washington, $178,500, down 1.9 percent
Around the rest of the state, the highest April housing price gain was in the northeast region with an 11.5 percent increase to $117,500. Home prices in the northern region increased 5.3 percent to $100,000 and prices in the south central region increased 2.3 percent to $155,525.
"With ten straight months of double-digit growth in Wisconsin home sales, I think it's safe to say we've turned the corner on sales, and we've seen some preliminary signals that prices have begun to move upward," said WRA president and chief executive officer Michael Theo. "While we hope that prices have bottomed out, we can't draw that conclusion from just two months of data. (But) if recent sales trends continue, it will not be surprising to see Wisconsin home prices appreciate in the next year."
Home prices in southeast Wisconsin should rise within the next year, Horning said.
"We've plateaued," he said. "I don't think prices are going down anymore."