WisBusiness: Experts say Milwaukee area could see real estate turnaround

By David A. Wise

WisBusiness.com

Despite a decline in southeastern Wisconsin home sales and prices, real estate experts in a conference call today said they see signs the market is poised for recovery.

A Greater Milwaukee Association of Realtors report released today show sales down 9 percent since last March and down 33.9 percent since March 2007 in the region. First quarter sales were down 13.1 percent from last year, and down 35.4 percent since 2007. Sales in the city of Milwaukee, however, have increased 5.8 percent in the first quarter.

Mike Ruzicka, president of GMAR, said sales are starting to pick up.

“There seems to be more activity, particularly in the first-time home buyer range,” Ruzicka said. “I think we could be at the beginning of a recovery now. We won’t know for sure until June or July, looking back at the numbers to see if … the increase in sales activity relative to last year is a trend or not.”

Ruzicka attributed possible recent increases to a “perfect storm” of low interest rates, good availability and price reductions. First-time home buyers are also eligible for up to an $8,000 tax credit.

“It seems like things could be gelling here,” Ruzicka said. “We could be on the right track.”

Tammy Maddente, executive vice president of the First Weber Group, expressed optimism for recovery.

“The signs are there,” Maddente said. “For the last a couple of weeks we have not seen a decline in the activity, it seems to be the opposite.”

Ruzicka predicted Milwaukee’s market would be one of the first to experience recovery.

“I would guess that the Milwaukee market is going to be one of the first national markets to break out of the downturn because we didn’t go up that high and we didn’t go down that far,” Ruzicka said.

The report showed prices were also down throughout the region, but varied widely by county. Ozaukee County had a less than 1 percent decreases in first quarter prices, while Milwaukee County showed an average price drop of 31 percent. The report attributed Milwaukee County’s drop to activity within the city of Milwaukee. There, the average sale price decreased from $136,757 to $84,423, with 62 percent of homes selling for less than $85,000.

Ruzicka noted that many of those sales were the result of foreclosures.

Bob Larson, general manager, First Weber Group, noted that some sales have been complicated by the fact sellers have already adjusted their prices to reflect the down market, but some buyers are still in the mode where they feel they have to drive down offers.

“I see very, very difficult transactions,” Larson said. “Buyers are coming in with ridiculously low offers, which really impedes the whole process.”

Beth Jaworski of Shorewest Realtors noted there are two types of buyers on the market: bargain hunters and those who are offering at or near full price.

Kristin Prange of Premiere Properties pointed to signs the share of the latter may be increasing.

“Now the sellers are in line with their pricing, and we are starting to see more reasonable offers from the buyers that are serious about purchasing at a fair price,” Prange said.

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