Wisconsin Housing Report — January 2023

January 2023 at a glance

• Wisconsin existing home sales fell 33.8% in January 2023 relative to January 2022, and the median price of homes that closed in January rose 8.5% over that same 12-month period to $250,000.
• The slide in January home sales continued a trend that first emerged in the fourth quarter of 2022. While home sales in the first nine months of 2022 fell 8.8% compared to the first nine months of 2021, they slid 30.1% in the fourth quarter of 2022 compared to that same quarter in 2021. 
• Although mortgage rates have fallen from peak levels in October 2022 when they averaged 6.90%, they remained relatively high in January 2023 at 6.27%. Note that this compares to a rate that averaged just 3.45% in January 2022.
• Inventories remained very low, which kept upward pressure on home prices. At just 1.9 months of available supply, which is unchanged from a year earlier, the weak existing home market is still classified as a seller’s market since it is well below the six-month benchmark that characterizes a market that is balanced. Larger metropolitan markets have the most sales activity and the most limited supply at just 1.8 months, but even the less densely populated rural areas have very weak supply at only 2.6 months.
• New listings are down 26.2% compared to January 2022, and total listings are 16.2% lower than their levels 12 months earlier.
• Affordability continues to be the primary reason that demand is so weak.
• The Wisconsin Housing Affordability Index measures the percent of the median-priced home that a household with median family income can purchase, assuming a 20% down payment, and a 30-year fixed-rate mortgage at current rates financing the remaining balance. The index fell from 212% in January 2022 to 150% in January 2023, a reduction of 29.2% over the last 12 months.

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