Milwaukee - State of the Market

[Marcus Auerbach]

I am on record for stating publicly that I don't see a down turn in 2019, at least for our market here. We are technically way overdue for a downswing after 7 years of going up, but I can't find it in the data. On the most fundamental level it comes down to supply and demand - and while we have very strong demand, supply keeps shrinking! 

13.5% fewer houses active for sale and fewer new listings than last year. We see a similar picture in the surrounding counties and across all price points. As of late even luxury listings are getting multiple offers. I hope this is just winter weather related (we had a very cold winter) and we see more inventory soon. 

Also note how the median asking price has shifted up to 120-160k, which BTW is still far off replacement cost and cost of new construction cost. You would think that more people would cash out and sell, many are definitely in an equity position and mortgage rates have fallen again (totally unexpected as of last year) to about 4%.

[Marcus Auerbach]

Originally posted by @Josh Teunissen:

In my town in ozaukee county we have new builds for +/- $220,000 that are smaller sq/ft and "green homes" but even that seems like a stretch for our median household income of $67,xxx. 

Does ozaukee fall into greater milwaukee growth? 

I hope I dont detract from your thread and I appreciate your knowledge and experience. I just feel like any hit to employment or income would be really bad. Where would that come from, idk, but I'm trying to learn

Granny's not buying stocks yet! But my younger brother did get a 0 down loan...

Well, if you look at it on a national average it takes a person 77 months with a median income of 52k to save up the 20% down payment for a median home (216k). Northern Ozaukee Co is not far from that median. And if you use a 5% down loan or 3.5% FHA for your first home, you need only a fraction of that time.

In Pittsburgh, Cleaveland, Detroid etc about 4 years. In NY, Miami etc about 10-11 years and in San Francisco, you probably guessed it 31 years. So basically if you are not a Crazy Rich Asian or have a house to sell in the bay area good luck saving up!

Chances are the next down swing will be much softer than the last one; however most savy landlords have done just fine during those 2009-2012 years and I would not mind to see a market like that again in my life time and be able to take advantage of discounted opportunities!