Area housing market still taking it on the chin

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• Link to full Wisconsin Realtors Association report

Across the state, home sales dropped by more than 20 percent in the second quarter of 2008 compared to the same period of 2007.

That drop was steeper than the national rate of 16.3 percent and the rate in other Midwestern states, which was 17.9 percent, according to figures released Thursday by the Wisconsin Realtors Association.

The chairman of the WRA put the blame for the drop on the economy.

"It is clear that consumer concerns over the direction of the economy have kept a lot of buyers on the sidelines," said Michael Spranger.

In the far western region, there were 32 fewer homes sold in the second quarter of 2008 over 2007. The median price of a home there dropped from $196,400 to $182,900.

The median price of a home in St. Croix County dropped $13,500 or 6.9 percent from 2007 to 2008. Meanwhile, the number of home sales there dropped from 313 to 281.

The number of fewer homes sold in Pierce County was 25, a 22.5 percent drop from 2007 numbers. The median price also dropped, going from $180,000 to $172,600.

Home sales in Polk County saw the biggest drop in the region.

There a total of 154 homes were sold in the second quarter of 2007, but this year that number was just 105 - a 31.5 percent drop.

Prices dropped 15.1 percent, with the median price going from $162,500 to $138,200.

For their report, WRA combines Pepin, Buffalo and Trempealeau counties into one. That area saw the median home price fall from $114, 000 in 2007 to $103,500 in 2008.

There was a 30.1 percent drop in home sales in that area with just 51 homes sold in the second quarter of 2008 compared to 73 in 2007.

Other counties in the west-central region saw similar results with home sales dropping by 27.8 percent in Chippewa County, 9.7 percent in Dunn County and 13.1 percent in Eau Claire County. The median price in all three counties also declined.

Spranger noted that mortgage rates have begun to creep upward recently, which may prompt potential buyers into the market.

"This is an opportune time for buyers to get off the fence," said Spranger.

According to Spranger, conventional 30-year fixed-rate mortgages increased about a half percent in the last two months, but still remain below 7 percent.

"That means there are excellent opportunities in this market, but buyers shouldn't wait too long or they risk higher interest rates," he said.

The WRA president said that the recently-passed housing bill might help the market too.

"First time homebuyers can now receive a tax credit of up to $7500, which should help to get some of them off the bubble and into a home," said William Malkasian.

While Malkasian is optimistic real estate brokers across the state aren't.

A survey by WRA of real estate brokers showed that 83 percent of the brokers believed that inventories will stay the same or rise in the third quarter.

The survey also showed that there is consensus among brokers that the remainder of 2008 will be weaker than the second half of 2007.

More information is available on the WRA Web site at www.wra.org .

Tags: housing market, wisconsin, news, slow