The third quarter of 2009 saw the first increase in Wisconsin home sales since the recession began in the 4th quarter of 2007. Compared to the 3rd quarter of 2008, existing homes sales increased 5.8%. This surge in sales is largely credited to low mortgage rates and the $8,000 first-time home buyer tax credit.
Wisconsin’s home sales increase compared favorably to the country as a whole, which saw a 5.9% increase. The Midwest region was at 5.2% increase.
Although sales increased, the median home price in Wisconsin fell 6.3% in the 3rd quarter of 2009 compared to same period of 2008. The national reduction in median price was at 11.2%, so Wisconsin managed much better than the national average. It is likely that a part of the reason for this decrease was a depreciation in house values, but another reason may be the abundance of lower priced homes being sold due to the first-time home buyer credit. With this in mind, Flor stated “Wisconsin home prices are not nearly as volatile as we have seen in other parts of the country and so purchasing a home in Wisconsin remains a very stable way to build household wealth.”
John Flor, Charman of the Board of the Wisconsin Realtors Association, sees a bright future for the economy as we head into 2010: “The extension and expansion of the federal tax credit is not only good news for home buyers and sellers, but also for the economy as a whole. Families buy a wide range of goods and services after they purchase a home, which helps the entire local economy, and sales of starter homes create opportunities for sellers to trade-up to a new or more expensive home.”