December home sales decline 10.8% in metro Milwaukee
Year ends 1.8% down

Freeman Staff

Jan. 15, 2019

WAUKESHA — The home selling market for the metro Milwaukee market did not end on a high note for 2018 with a decline of 1.4 percent in year-over-year sales and the month of December also dipping 10.8 percent when compared to last December, according to data from the Greater Milwaukee Association of Realtors on Monday.

The data showed that all four counties in metro Milwaukee, Ozaukee, Washington, Waukesha and Milwaukee counties, had lower sales in December compared to December 2017. Waukesha County had the biggest decline at 15.3 percent, followed by Ozaukee at 11.3 percent, Milwaukee at 9.4 percent and Washington at 4.9 percent.

According to the GMAR, 1,242 homes sold in December, which is 307 fewer than in December 2017, when 1,549 units sold.

Although December tends to be a slow month for real estate, GMAR President Mike Ruzicka said that “the steep drop during a typically slow month is primarily attributed to a lack of homes for sale and increasing interest rates.”

For the fourth quarter of 2018, 21,060 homes sold, down 1.4 percent from 21,357 units sold in 2017.

In the report, Ruzicka said that 2018 was a strong year for area real estate despite the decline in sales and finishing a little behind 2017.

“Over the last three years, 2016, 2017 and 2018, the 4county metropolitan market had over 21,000 sales. We have only been above 21,000 sales one other time this century, in 2005 (21,642),” he wrote.

Ruzicka said he anticipates the Federal Reserve to raise interest rates to more than 5 percent in 2019 to try to keep the economic boom going, but that would likely be a constraint on the demand side of the real estate market.

“There is no sign on the horizon that the lack of listings under $300,000 is going to be alleviated, which normally means prices for those properties would be pushed up,” he wrote. “We saw this in 2018, as multiple offers were submitted within hours of a quality property’s listing. $300,000 listings were ultimately selling for $325,000 and even $350,000 as the market tightened.

“As some buyers are eliminated from the market due to rising interest rates, demand will be lower than in recent years. That will lessen the inflationary effect of multiple offers on desirable properties. Therefore, price increases will probably be limited to the low, single digits, around 2 percent to 3 percent. Unit sales for 2019 will probably be slightly below 2018, somewhere in the 20,000 range.”

The average home sale price in metro Milwaukee increased during the fourth quarter, for a total of 6.3 percent.

Broken down by county, Milwaukee County’s fourth quarter sale price increased 6.9 percent to $188,107 and Washington County’s increased by 9.9 percent to $260,183. In Waukesha County, home sale prices increased 3 percent in the fourth quarter to $330,716 and Ozaukee County went up 6.6 percent for a total of $353,184.