We know a lot of you have questions about how the Madison area real estate market is evolving, so we'll be sharing a lot of good information with you in the weeks and months ahead. This begins with our Madison single family home report, which will be updated regularly and is linked here. Below is our short summary of the latest trends and our perspective on how the market is changing.
Here's a quick summary of the March single family home market:
Madison home sales increased by 19% from March of 2019.
Accepted offers increased by 22%.
The number of expired listings and the average days on market remained near historically low levels.
The number of new MLS listings entering the market was the lowest total in the last 18 years.
Madison home prices increased by 7% from March of 2019.
Here's a snapshot of single family home supply as of April 4th, 2020:
Single family home listings continue to be in very short supply. Currently there is only one month of inventory available for sale in the city of Madison.
Just under 49% of all single family home listings are under contract with an accepted offer. This high number represents a market with a lot of strong buyer activity in the month of March.
Here's what we expect to happen in the month of April:
April home sales will be near historically high levels. This assumes real estate services continue to be classified as "essential" by the state of Wisconsin.
April home prices will also be strong (again, assuming real estate services are considered essential).
However, the number of accepted offers in April will decrease. We're beginning to see decreased buyer activity right now, as some buyers have either chosen to withdraw or have been forced to withdraw from the market.
How will sellers be impacted by decreased buyer activity in April?
On the whole, sellers will need to work harder for their sale and make sure their pricing is on the mark, but one thing sellers have going for them right now is low inventory. The city of Madison currently has only one month of single family home supply, and new listings continue to enter the market at a slow pace. So even though buyer activity is decreasing right now, we expect low supply will be a stabilizing influence on prices this spring (especially for homes listed at $350,000 and under).
How does the Madison single family home market vary by price range?
We have 3 snapshots to share with you which provide some good insight into our market.
Months of inventory are lowest for properties priced under $350,000.
All of the price categories under $350,000 have very low levels of inventory, which is indicative of a high demand/low supply market.
The percent of listings under contract is highest for properties $350,000 and under.
Well over 50% of the listings priced between $150,000 and $350,000 are under contract and scheduled to close soon. This is a sign of strong buyer activity in the under $350k market.
Listings priced under $350,000 are most likely to receive competing offers.
The data below comes from 2019 and is consistent with our experience in 2020. (In the last two weeks, we have had several sellers receive multiple offers from motivated buyers.) The high number of competing offers is a sign that there are more buyers than sellers in the under $350k market. Although some buyers are dropping out of the market right now, we expect less competition will allow other buyers to step in and purchase their home in a more balanced market.
Do you have questions about buying or selling in our new market?
Please reach out to us and tell us more about your goals in the months ahead. We'll answer all of your questions and share some next steps that will help you move forward in a positive direction. We're well-prepared to assist you and offer you sound advice in this year's fast-changing real estate market.
This article is published courtesy of: Dan Miller, REALTOR Mad City Dream Homes & RE/MAX Preferred