March 2024 at a glance
- As the first quarter of 2024 ends, both existing home sales and median prices rose by solid margins compared to a year earlier. This reflects robust demand conditions even as supply remains tight.
- March existing home sales rose 3.2% compared to March 2023, and the median price rose 10.1% to $299,900 over that same 12-month period. On a year-to-date basis, existing home sales increased 5.6% in the first quarter relative to Q1 2023, and the median price rose 6.7% to $280,000 over that same period.
- Supply conditions remain very tight, with just 2.9 months of available supply in March. This is well below the six-month benchmark that signals a balanced market. Still, months of inventory improved in every region of the state due in part to more listings.
- New listings were up 4% statewide between March 2023 and March 2024, and total listings grew 10.6% over that same 12-month period.
- Mortgage rates rose throughout the first quarter. The average 30-year fixed mortgage rate rose to 6.82% in March, up from 6.64% in January. It is also higher than the March 2023 rate of 6.54%.
- Higher prices and higher mortgage rates have hurt affordability. The Wisconsin Housing Affordability Index shows the percent of the median-priced home that a potential buyer with median family income qualifies to purchase, assuming a 20% downpayment with the remaining balance financed with a 30-year fixed-rate mortgage at current rates. The index fell 10.6% over the past 12 months to 126. This puts affordability close to its lowest point in nearly 15 years, recorded last year when it fell to 123 in August and September.
Analysis from the experts
Growth in Listings Fuel First Quarter Sales
"Total listings have been improving since October, and they’ve been up by double-digit margins on a year-over-year basis for the last two months. This has helped push first quarter sales up for the first time since 2021. Hopefully this trend continues as we move into the all-important summer sales period."
Mary Jo Bowe, 2024 Chair of the Board of Directors, Wisconsin REALTORS® Association
High Mortgage Rates Have Reduced Affordability
"The 30-year fixed mortgage rate continues to hover near 7%, which, combined with higher median prices, has pushed statewide affordability down by just over 10%. Strong demand from millennials is driving up sales but also putting pressure on prices. We really need to see rates come down if affordability is to improve."
Tom Larson, President & CEO, Wisconsin REALTORS® Association
Prospect of Multiple Rate Cuts in 2024 Is Fading
"A soft landing of the economy may still be possible, but the runway is long, and the prospect of multiple rate cuts in 2024 is fading. The problem is that progress on inflation has stalled. The Fed’s preferred measure is core inflation, which factors out the volatile food and energy sectors. The annual core inflation rate remained at 3.8% in March, which is only slightly lower than the 4% rate of last October. This combined with a resilient labor market operating at full employment makes the prospect of multiple rate cuts by the Fed in 2024 less likely."
Dave Clark, Professor Emeritus of Economics and WRA Consultant
