In the Madison, WI market in July, closings of new homes dropped year-over-year, and the percentage decline that was steeper than June 2015 gave implications of worsening market conditions. There was a 51.9% drop in new home closings from a year earlier. This followed a 20.0% fall year-over-year in June.
A total of 506 new homes were sold during the 12 months that ended in July, down from 548 for the year that ended in June.
As a percentage of overall housing closings, new home closings accounted for 3.1%. This is a decline 6.8% of closings a year earlier. Closings of new and existing homes gained year-over-year in July after also rising in June year-over-year.
Pricing and Mortgage Trends
In July, the average value of new homes saw a 9.8% lift year-over-year as it grew to $351,357 per unit. This gain is an improvement over the 1.6% surge in June year-over-year.
For newly sold homes, the average mortgage size gained year-over-year along with new home prices. The average mortgage size rose to $295,745 in July, marking a 8.4% rise compared with a year earlier. Average mortgage size grew 11.0% in June 2015 from a year earlier.
Other Market Trends
As a share of new home closings, single-family home closings have climbed from last year while the share belonging to attached units has fallen. Single-family home closings increased from 82.7% of new closings in July 2014 to 89.7% of closings in July 2015. Meanwhile, attached units as a percentage of all new home closings sank to 10.3% of closings from 17.3% of closings.
For all new homes sold, the average unit size dropped 22.5% year-over-year to 1,528 square feet in July 2015.
Foreclosures and real estate owned (REO) closings continued to drop from a year earlier in July, but did not look to be a burden on the market. Together, foreclosures plus REO closings made up 6.6% of existing home closings, down from 10.0% a year earlier. The percentage of existing home closings involving foreclosures fell to 2.3% in July from 4.2% a year earlier while REO closings as a percentage of existing home closings slid to 4.3% from 5.8% a year earlier.