(First published in the April 4, 2019 issue of City Pages)
Looking to buy a house? Get ready to fork over extra dough, or wait
Wooden House With The Inscription Sold On White Isolated Backgro
For potential home buyers in central Wisconsin, the last few years haven’t been easy. And 2019 isn’t looking to be much different. It’s still clearly a sellers market, around Wausau and beyond.
“The market right now is crazy,” says real estate agent Nichole Guenthner of EXIT Greater Realty. “It’s a continuation of 2018.”
Any house in move-in ready condition gets snapped up in a day, maybe two at most, Guenthner says. Sellers are getting multiple offers, and selling at much higher than asking price.
Guenthner tells a story that perfectly illustrates the situation. She had worked with a couple who wanted to buy a house in 2018. After putting in several offers, coming away with nothing, and becoming discouraged, they put their search on hold. This year, after getting married, they decided to try again, Guenthner says. And two offers later, they still don’t have a house.
“It’s a little frustrating trying to hang in there,” Guenthner says. “It’s a waiting game.”
Home sales in Marathon County bottomed out in 2011, with only 1,061 sales, down from 1,400 only four years prior. Sales of homes tanked as the economy struggled to recover in the wake of the Great Recession. Median home prices hit an all time low too, bottoming out at $114,000.
But the market has been gathering steam ever since. Numbers of home sales hit 1,865 in 2018 in Marathon County—the most as far back as the Wisconsin Realtors Association data goes. Home prices also have risen. The median home price in Marathon County sales last year was $155,000 — more than $40,000 over the 2011 low.
Bidding wars make finding a home difficult now. The other effect of the hot market is that while demand increases, supply decreases. Real estate agents are even having a hard time finding homes to list, says real estate agent Lora Bladow of Remax Excel. “Insane. Crazy. There are no other words for it,” Bladow says about the current real estate market. Inventory is extremely limited, and four to six buyers competing for a home is not at all uncommon.
Coupled with that are attractive mortgage interest rates. Real estate agents were bracing for interest rates to rise and possibly thin out some potential buyers as borrowing becomes more expensive. Instead, rates decreased again.
A couple of other complications are now thrown into the mix, Bladow says. Real estate agents are seeing longer closing dates. Instead of the typical 30 days out for a closing date, sellers are seeking nearly two months sometimes. That is often because the seller is trying to buy their own house or building one, Bladow says. In a sellers’ market, they are in a position to dictate terms.
Another is a shortage of appraisers, Bladow says, which makes the closing process take longer.
Relief might be on the way, Bladow says. Markets in other areas such as Minnesota are starting to settle as more new homes are being built. The market is starting to balance in those areas and that tends to be an indicator of what will happen in the Wausau area in the next couple of years.
The Wausau area is poised to see a large number of new apartment units soon. That combined with new housing developments such as the townhouses designed by Blenker or the Riverlife complex, which could draw empty nesters out of their homes into downsized living spaces, could introduce new inventory to the market.
Guenthner says she knows of at least one couple waiting for the Riverlife development to be complete so they can downsize and sell their house.
In the mean time, the pickings will be slim. Bladow says she works with clients who are relocating to town and struggling to find a pad. “I still have people living with family members, or living in temporary rental housing,” Bladow says.
How slim are the pickings? Guenthner says on Wausau’s southeast side neighborhood there are currently only two houses on the market (i.e., no accepted offers). One is a fixer-upper and the other is very small. That’s not unusual. Most Wausau area neighborhoods have similarly low numbers of available houses.