Dane County Home Prices Will Continue to Rise

In the world of real estate, the ups and downs of home values are the subject of much speculation and analysis. 

Yet, when it comes to Dane County's market, a few key factors make a compelling case for why we don't foresee a downturn in home values anytime soon. Here's a look into the dynamics at play, bolstering the strength and resilience of our local real estate market.

1. Supply and Demand

At the heart of any economic discussion lies the fundamental principle of supply and demand. In Dane County, the real estate narrative is starkly defined by this dynamic.

With fewer than 700 active homes on the market at any given time over the past few years, inventory levels are significantly lower than in previous years. To put this into perspective, 2019 saw double the inventory, while 2014 boasted four times as many listings.

Both these periods were seller's markets with over 4% appreciation. In other words, we have a long ways to go in solving our low inventory problem before we can expect home values to decline. 

2. Demographics

Dane County isn't just growing; it's flourishing. A crucial factor this growth is the demographic makeup of the region. Notably, Madison ranks fifth in the nation for the highest concentration of Millennial residents per capita.

This demographic, in their prime home-buying years, is a significant force driving demand in an already tight market. The vibrant, youthful energy of the city, coupled with its economic opportunities, continues to attract a steady influx of potential homeowners, keeping the market buoyant.

3. Lack of Distressed Properties

Reflecting on the turbulence of the last housing crash, distressed properties (foreclosures and short sales) played a pivotal role in plummeting home values. However, today's landscape presents a starkly different picture.

With only about 1 in 200 homes classified as distressed, the specter of foreclosures exerting downward pressure on the market is virtually non-existent. This dramatic decrease from the 2012 figure, where nearly 1 in 5 homes were distressed, highlights a robust and healthy real estate environment, further solidifying the foundation for sustained home value appreciation.

The Takeaway

With these three reasons at the forefront—tight supply and demand dynamics, a demographic bulge in prime home-buying age, and the negligible impact of distressed properties—it's clear why we're optimistic about the continued rise in home values in Dane County.

For people in the market to buy a home, waiting is not the game to play. This strategy could cost thousands of dollars in higher sales price and lost equity. 

Have insights or questions about the current state of the Dane County real estate market? We'd love to hear from you, leave us a comment or send us a message at contact@theminterteam.com.