Latest figures show prices are down due to sale of distressed properties
By Dave Fidlin
Correspondent
Although our local counties fall below the state average in home sales and home prices, a local real estate expert is optimistic about future figures.
The Wisconsin Realtors Association recently released its housing report, detailing figures by county and region in January 2011 vs. January 2012.
The figures represent an overall increase in home sales, but a decrease in median prices. Locally the number of sales is down slightly with the prices down significantly for that same comparison.
Statewide, home sales jumped 10.8 percent in year-to-year comparisons, from 2,584 sales in January 2011 to 2,862 in January 2012.
In Walworth County, home sales jumped 1.6 percent, with 63 homes sold in January 2012 and 62 homes sold in January 2011. Home sales were down over that same comparison period in Racine County from 99 to 93.
Year-to-year, the median price of home sales was driven down. Statewide, the average home in January 2011 sold for $128,508; in January 2012, the median price decreased 7 percent to $119,500.
In Walworth County, the average home sold for $141,500 in January 2011, while in January 2012 the median figure was $125,880. In Racine County those figures were $105,000 for January 2011 and $95,000 for January 2012.
Rob Keefe, a Lake Geneva-based real estate expert, cautioned that a snapshot of year-to-year comparisons within the scope of one month can be somewhat misleading.
“It’s all weather dependent,” he said. “It’s the luck of the draw and is based solely on what goes on within the course of one particular month.”
But Keefe, who recently was named chairman of the WRA’s board of directors, said the statistics do assist in painting a bigger picture for residential real estate, which has been reeling for more than three years since the housing bubble burst and the nation’s economy went into free fall.
“I’d say Walworth County is most likely at the bottom of the real estate cycle right now,” Keefe said. “We’re slowly climbing our way out.”
Keefe attributes the decline in median home sales prices – statewide and in the area – to the continued sale of distressed sales through foreclosure proceedings.
“Buyers have been snapping up foreclosed properties,” Keefe said. “There’s been a lot of interest, which is good news.”
Keefe maintains a website, www.realestatestatsblog.com, and recently opined about the need to clear the market of foreclosures.
“The market will not achieve a healthy balance until the huge overhang of inventory is resolved,” Keefe wrote in a recent blog post. “I think we are still a couple of years away from that day. Until we get there, the recovery will continue (to result in) increasing unit sales and decreasing average sales price.”
Keefe said he anticipates the local tipping point of foreclosed properties within the next year to year-and-a-half.
“Once we clear ourselves of the distressed sales, the price appreciation will start to go back up,” he said. “But it’s all about clearing out that inventory.”
According to the WRA, January is traditionally the slowest month for home sales. The figure has held true even in midst of the downturn in recent years.
While WRA officials assert sales figures are encouraging, they also acknowledge overall consumer confidence remains skittish.
“With all of the uncertainty in the world economy and talk of a possible meltdown in Europe, that’s not surprising,” said Michael Theo, WRA president and CEO. “But there are some incredible deals for buyers who can obtain credit, and anyone even remotely considering a purchase will find great opportunities in this market.”
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