Home sales increase in April

The following information was provided by the Greater Milwaukee Association of Realtors.

Home sales were up in the Metropolitan Milwaukee market 13.4% for April as 1,610 homes sold in April compared to 1,420 in April of 2014. Comparing the numbers to 2013, sales were up 2.2% (1,576 in ‘13). April was the second month of solid sales this year. Buyers are very active and quality homes, in excellent condition, are sometimes receiving multiple offers.

Similar to March’s eye-popping 25.6% increase in sales, April’s large increase over the previous year is partly due to market dynamics in the spring of 2014. At that time, distressed sales had left the market and were replaced by a healthy ‘traditional’ (first-time/moveup/empty-nest) market.

The transition from 2013’s high volume, value market, to 2014’s “normal” one, meant fewer sales initially. The normal market picking up speed is what we’re experiencing today.

Listings Increase

April was the 3rd month of the year, and 10th of the last 12 months, that saw listings increase. While more listings are needed to satisfy demand, brokers are still reporting that inventory is tight, particularly among move-in ready properties, because the number of buyers looking is high.





Inventory

The seasonally adjusted inventory level for April was 7.3 months, just up from March’s 7.1 month level. The seasonally adjusted level was 7.5 months in April 2014.

Subtracting the 2,537 listings with an active offer from current listings presents an effective inventory level of 4.7 months, a hair higher than March’s 4.6 month level. A year ago, the same calculation showed April’s inventory level at 5.2 months.

Inventory of 4.7 months and more sales means sellers should be seeing slightly higher prices this spring. According to the law of supply and demand, we should see price increases, because, even with a 1.1% increase in listings, there are more buyers circulating in the market (demand) absorbing available inventory (supply).

Market Challenges

Brokers are reporting that some deals are falling through, because of poor appraisals. Some appraisers are using market data that is too old and does not reflect current market conditions, resulting in overly cautious appraisals. This may be a lasting result of the credit crisis and recession, which forced lenders and appraisers to be defensive in their estimates.

Where to go Buyers should seek the counsel of a REALTOR® in determining their best housing options, and sellers need a REALTORS® expert advice in making correct marketing decisions with their home.

The Greater Milwaukee Association of REALTORS® is a 4,000-member strong professional organization dedicated to providing information, services and products to “help REALTORS® help their clients” buy and sell real estate. Data for this report was collected by Metro MLS, Inc. a wholly-owned subsidiary of the GMAR.

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