Madison area home prices continued to reach new highs in the month of August, while days on market continued along record lows. Here's our latest update on the Dane County single family home market.
Dane County single family home inventory
Active inventory increased dramatically in May and June, and then leveled off in July and August. Inventory remains very low from an historical perspective, which is one reason why we expect Madison area home prices will remain elevated in the months ahead.
Dane County single family home new listings
Inventory remains low because new listings are entering the market at a very slow pace. In July, new MLS listings decreased by 25% from the year before. In August, new listings decreased by 30%. Through the first 8 months of the year, new listings are entering the market at the slowest pace since the year 2000. We expect more of the same this fall, based on the numbers for early September.
Accepted offers
Accepted offers in August were down significantly from August of 2021 and 2020 (which were fueled by the pandemic and rock-bottom interest rates). But in the bigger picture, buyer activity last month was actually quite strong. More listings went under contract last month (491) than were listed for sale (484).
Competing offers
As expected, the percentage of listings receiving multiple offers is beginning to dip below the record-breaking pace from earlier this year. Our preliminary data for the month of July shows 40% of all listings received multiple offers, compared to 44% in July of 2021. Still, the percentage of listings receiving multiple offers is high when compared to other years. For example, in July of 2020, the percentage was 37%. In July of 2019, the percentage was 26%. In July of 2016, the percentage was 18%.
Showing activity
We do expect the competing offer percentage to continue to trend lower, as property showings continued to trend lower in August.
Days on market
Days on market reached a new low for the month of August. But keep in mind this number is based on offers that were written mostly in the months of June and July, back when demand was stronger. We do expect the days on market to rise above record lows in the months ahead.
Madison area home prices
The price per square foot continued to reach new highs in the month of August. September prices will continue to break records, too, based on our early view of the September data.
Where will the Madison area real estate market go from here?
The media and social media are full of doom and gloom headlines right now, but keep in mind these headlines are designed to create an emotional response and ultimately to generate more clicks, viewers, and revenue.
At Mad City Dream Homes, we don't foresee doom and gloom for the market. Just the opposite, we see a few fundamental trends at work that support more price appreciation in the years ahead. This recent blog post covers all of these trends for you.
