August 2021 Home Sales Report Summer Housing Market Constrained by Tight Inventories Date: September 20, 2021
August 2021 at a glance
August home sales fell 6.3% compared to their levels in August 2020, whereas the median price rose 6.4% to $250,000 over that same 12-month period.
For the second straight month, sales fell in every region of the state, and they dropped the most in the North and Central regions, down 19.1% and 3.7%, respectively. The Northeast region saw its August sales fall 9.8% compared to 12 months earlier, whereas the South Central, Southeast and West regions all fell by much smaller margins: the South Central region was down 2.2%, the Southeast region was down 2%, and the West region was down 2.9%.
Overall, this has been a solid summer for home sales, with closings for June, July and August just 5.6% below the record summer home sales recorded in 2020.
Year to date, statewide sales are ahead of the pace recorded in 2020, with 56,503 sales in the first eight months of 2021, up 2.7% over the January-August period in 2020. The median price is up 10.6% to $240,000 over that same period.
Inventories remain well below the levels of last year, with total listings in August 10.2% lower than 12 months earlier. There were just 3.4 months of available supply, down from 4.2 months in August 2020.
Homes continue to move quickly with average days on the market at the record-low level of just 65 days for the second straight month. This compares to 88 days in August of last year. This is the lowest level for days on the market since the WRA began tracking this data in January 2005.
Housing affordability slipped slightly, falling 3.6% over the last 12 months. Still, Wisconsin housing remains affordable. A qualified buyer with median family income can afford to purchase 189% of the median-priced home, assuming a 20% down payment and the remaining balance financed with a 30-year fixed-rate mortgage.
Analysis from the experts
Home sales and inventory
"Given the supply problem, it’s not surprising that sales this summer have not quite kept up with the
record pace established last summer. Even though REALTORS® have been moving homes quickly, they
can only sell what’s on the market, so we’ll continue to struggle to increase our sales on a year-over-year
basis until the inventory situation improves."
Mary Duff, 2021 Chair of the Board of Directors, Wisconsin REALTORS® Association
Evaluating the national economy
"There is no doubt that inflationary pressures have been increasing, with the annual inflation rate at or
above 5% since May. This is also creating potential headwinds for the economy, primarily from supply
side problems. Specifically, chronic labor shortages combined with the supply chain challenges have
kept businesses from expanding as quickly as they would have liked. Although the national economy is
still expanding at a healthy pace with real GDP up more than 6% over the first two quarters of the year,
until the labor and supply chain problems subside, we can expect more inflation and economic growth
that is below the economy’s potential."
Dave Clark, Marquette University Economist and WRA Consultant
Home prices, mortgage rates and and affordability
"Strong demand and weak supply create ideal conditions for strong price appreciation, and that’s
exactly what we’ve been seeing over the past year. However, there are some preliminary signs that the
double-digit price home price increases may be moderating slightly. The annual rate of appreciation
was over 14% in May and June, and it fell to just over 10% in July and to 6.4% in August. That is welcome
news since unsustainable price increases can reduce demand, keeping creditworthy buyers out of
purchasing homes."
Michael Theo, President & CEO, Wisconsin REALTORS® Association