Market Updates

Articles about the Dane County and Madison Real Estate Market

Found 58 blog entries about Market Updates.

Why do you absolutely need a good buyer agent in the 2018 Madison real estate market? The answer comes down to three words: Historically Low Inventory. As our latest home report shows, Madison single family home supply is now below 1 month of inventory.

In the Madison condo market, inventory is down to a historically low 1.2 months of supply. 

How does historically low inventory impact buyers? 

In a low inventory market, the best properties sell very quickly. That means in today's market the buyers who rely on their own internet searches to find properties and schedule showings usually miss out on the opportunity to buy. Very often they're distracted by properties that already have an accepted offer (hint: this is a very common theme for

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Our most recent single family home report shows 2018 is shaping up to be another strong year for sellers in the Madison area. Right now there is only 1 month of home supply in Madison, which is about as low as it can go for our market. 

A closer look at inventory shows how supply has tightened over the last year:

  • In December of 2016, a total of 438 Madison single family homes were listed for sale on the MLS. In December of 2017, that number dipped to 376 (a decrease of 14%). 
  • In December of 2016, 33% of single family home listings had an accepted offer. In December of 2017, the percentage increased to 39%. 
  • In December of 2016, 1.4 months of supply were listed for sale. In December of 2017, supply decreased to just one month. 

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This year we're getting a jump on our annual predictions for the Madison real estate market. Without further adieu, here our real estate predictions for 2018. (For a look back at last year's predictions, check out this post.)

#1: New home and condo construction will remain low. 

New apartment buildings continue to pop up all over the city. Meanwhile, single family home housing starts have plateaued in 2017, while new condo construction remains almost non-existent. All signs point to more of the same in 2018.

#2: The foreclosure pipeline will be nearly empty. 

Madison area foreclosures are at a 16 year low, which means distressed property listings will be relatively rare in the coming year. 

#3: Housing demand will remain strong. 

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We recently added a view of the cash buyer market to our monthly home and condo reports - and the results provide some interesting takeaways for both buyers and sellers. Here's a quick summary of our findings. 

Cash offers are common in the condo market. 

Overall, 1 out of every 5 Madison condo sales through the month of October have gone to cash buyers. This is below the historical high of 26% in 2012. Cash offers peaked 5 years ago when Madison condo prices bottomed out. 

Takeaway: Based on current market trends, buyers and sellers should expect at least one cash offer whenever multiple offers are submitted for a condo listing. 

Cash offers are most common with higher priced condo listings. 

Baby Boomers are the key drivers of this

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Madison condo prices are rising rapidly. As we recently reported in our latest market update, prices are up 13% through the month of October. That's a huge year-over-year increase - and one that's not sustainable. Although we don't expect prices to increase another 13% in 2018,  a 10% increase is entirely possible. Below we've outlined 5 reasons why local condo prices will continue to escalate in 2018. 

5 reasons why Madison condo prices will rise again in 2018

#1: Historically low supply 

Right now the Madison condo market has only 1.5 months of supply. This is about as low as it gets in our market. Historically low inventory will push prices higher in 2018. 

#2: An empty pipeline

Very few new construction condos are being built to

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We recently noted in our October real estate update that there are only 1.7 months of supply in the Madison housing market. We're expecting more of the same for the foreseeable future, and here's why:

New home construction is low. 

Although there is a genuine need for more inventory, new housing starts remain about 50% below the peak levels from 2002 - 2005. One big reason for this is the last real estate downturn put many home builders out of business. With fewer builders in the marketplace, fewer homes are being built.

Housing starts for duplexes and single family homes have basically plateaued, as can be seen in this graph below. It's also important to note that new condo construction is at a virtual standstill and nowhere near the level

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We've updated our trend reports for the Madison single family home and condo markets, and the major theme continues to be low inventory. As of October 17th, only 1.7 months of supply are available for sale in the Madison single family home market. The single family market has now had less than 2 months of supply for 23 straight months. Inventory is especially tight for houses priced under $350,000. 

The condo market also has only 1.7 months of supply. Condos priced under $250,000 are in highest demand right now. 

Home Prices

In September, the Madison single family home price per square foot was $155, which was a record high and up 7% from last year. Year-to-date the price per square foot is up 10%. 

Condo Prices

The condo price

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In our August real estate update we've noticed an interesting trend in the Madison single family home market: New Madison listings have now quietly increased in 5 of the last 6 months. From March through August, listings are up 5% from the same months in 2016. This is a modest increase, but it's a step in the right direction toward a more balanced market which has enough housing supply to meet the needs of Dane County's growing population. We'll keep a close eye on listings in the months ahead. 

More Single Family Home News

All of our latest single family home statistics show it's still a strong seller's market in Madison. Currently there are only 1.9 months of single family home supply. Although this number is up slightly from 1.8 months a year

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Home and condo prices rose again in July as the seller's market continued in Madison. Here's a brief market summary for the month of July. 

Madison Single Family Home Market

The price per square foot rose from $146 in July of 2017 to $158 last month - a record high for the single family home market. July home prices rose 8% year-over-year and 11% year-to-date. 

July 2017 Madison WI Home Prices

The days on market statistic also set a new record in the month of July - reaching a new low of only 22 days. On a year-to-date basis, the days on market averaged only 32 days, which is also a record low. 

Months of supply continued to trend along historically low levels. This snapshot taken a few days ago shows there are only 1.8 months of inventory in the Madison single family

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Low Housing Supply in Madison WIRealtor.com says Baby Boomers are a major cause of the housing shortage in the US. According to these recently released survey results, Boomers are generally satisfied with their current home and reluctant to move onto a new setting. This generational trend, according to the survey, is keeping listing inventory low and freezing would-be buyers out of the market. Among the survey findings:

  • 72% of Boomers say their home meets their current needs.
  • 85% of Boomers don't plan to sell in the next year.
  • Up to 33 million properties are being withheld from the market due to this generational trend. 

There's much more to the story than this. 

The survey makes it clear Baby Boomers are generally content to stay put in their current home, but it

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