As prices and mortgage rates rise, homes are getting less affordable in Wisconsin

Home prices have been rising for years in Wisconsin, and rising mortgage rates are pushing the cost of buying a home even higher.

The April housing report from the Wisconsin Realtors Association said the state’s median home price stood at $265,501 last month, up 13 percent from a year before.

Strong demand for homes, plus a declining number of homes for sale, have put upward pressure on prices in the state for some time.

Record-low mortgage rates have offset some of those price hikes, but now those rates are rising too. Marquette University economist David Clark said last month’s average mortgage rate was 4.98 percent.

“Last year it sat at 3.06 percent,” he said. “You’re up almost a full 2 percent. Even with slight growth in median family income, we are seeing a dramatic reduction in affordability.”

Existing home sales in April fell nearly 15 percent from those of April 2021.

Clark said while there’s still high demand for homes, sales are likely to continue to fall short of last year’s record figures even during the peak home-buying months.

“It’ll be a solid summer for sales, if you look at the last five to seven years,” he said. “But it’ll certainly be weaker than last year, and weaker than the year before that. Declining affordability will be the reason for that.”