RACINE COUNTY — Anyone who tried to sell or buy a home last year knew the residential real estate market was white hot.
Now, the numbers prove that.
The Multiple Listing Service’s end-of-year numbers for residential sales show a continuing upward push of home purchase prices. Nearly every Racine County municipality had a higher average sale price in 2018 than 2017.
In the City of Burlington, the average home sale price was $224,624. That was 12.5 percent above the previous year’s average of $199,639. In Mount Pleasant, the average sale rose from $197,242 to $219,767, an 11.4 percent increase.
However, more telling than the continuing rising tide of selling prices was a dramatic decline over the past few years — and especially last year — of how long houses stayed on the market before being snapped up.
MLS measures that activity with a statistic called “days on market,” the time from when a property is listed until it draws an accepted offer. Countywide, that number dropped from 99 in 2015 to 82 the next year, 62 in 2017 — and then dropped off the table last year, to 40.
Month after month, real estate agents were saying how quickly eager buyers made offers on any and all good-quality housing.
“Everything sold within hours or days,” said Jessica Smith of Shorewest Realtors, former president of the Racine Board of Realtors which has since merged with the Kenosha group. “If a house was on the market for more than two or three days, there was something wrong with it.”
Some sellers were receiving $10,000, $15,000 or even $20,000 more than their asking price, Smith said, which was “terribly tough” on the buyers. “They couldn’t be part of the game unless they had substantial savings.”
But 2018’s torrid buying spree was an anomaly, Smith said confidently. By November, the market had softened. People were having home inspections performed and requiring repairs — or they would walk away.
Many of those who overpaid were having buyers’ remorse, Smith continued, and some of those purchases had led to foreclosures or short sales, in which lenders agreed to take less than they were owed.
The same phenomena had played out on the east and west coasts about a year earlier, she said.
“I don’t expect to have the harried buying again,” Smith said. “… The market’s learned a lesson.”
Slower, but still strong
In the City of Racine, 1,053 houses sold last year for an average of $122,894 and only stayed on the market an average of 38 days. Just three years earlier, in 2015, the average sale price was just $86,421, and, on average, it took 100 days to get a sale.
Setting aside municipalities with relatively few housing sales last year, the place where homes were grabbed most quickly was Union Grove, with an average of just 25 days on market. The average selling price of those 48 sales was $206,953.
With that frenetic pace, lenders were understaffed; it would take two to three months to assess properties for sales,” John Crimmings, First Weber Group vice president and general sales manager, told The Journal Times.
“The first half of 2018, (we had) a very robust real estate market nationwide,” he said. “Then it started to slow down in some of the stronger markets nationally: West Coast and Southwest.”
But for the long term, Crimmings expects the Racine area’s real estate market to be very strong.
“When you have an economic engine, such as Foxconn and Foxconn-related activity in the community, three hospitals being built, Amazon surrounding us, a local economy where the jobless rate is already very low, the labor pool is already very shallow, people have got to come here from somewhere to fill these jobs ... They’re going to live somewhere,” Crimmings said. “Are they all going to buy houses? Probably not, but will they come into the area and have an impact on eventually buying houses and living in apartments? It’s going to be spectacular.”
“This is going to be one of the economic development areas in the country for many years to come,” Crimmings said. “I wish I were 20 years younger.”
“This is going to be one of the economic development areas in the country for many years to come. I wish I were 20 years younger.” John Crimmings, First Weber Group vice president and general sales manager