New home closings in the Madison, WI market fell year-over-year in May, but the percentage fall was not as steep as April 2016, suggesting that the market may be stabilizing. Closings slumped 9.6% from a year earlier to 47. In comparison, new home closings in the same month last year saw a 26.3% drop year-over-year in April.
A total of 431 new homes were sold during the 12 months that ended in May, down from 436 for the year that ended in April.
Of the total number of closings, new home closings made up 3.9%. New home closings were 4.4% of overall closings last year. Closings of new and existing homes climbed year-over-year in May following a drop in April year-over-year.
Pricing and Mortgage Trends
In May, the average price of newly sold homes declined 4.4% year-over-year to $329,902 per unit. This fall compares to a 6.3% lift in April year-over-year.
The average mortgage size on newly sold homes slid year-over-year in contrast to the average price of new homes. In May 2016, there was a 7.1% fall in the average mortgage size on new homes to $269,039. In April 2016, average mortgage size on newly sold homes saw a 5.1% bump year-over-year from a year earlier.
Other Market Trends
Closings of attached units, as a percentage of new home closings, have grown from last year while closings of single-family homes have fallen. Attached unit closings jumped from 5.8% of all closings in May 2015 to 17.0% of closings in May 2016. Meanwhile, single-family home closings as a percentage of all new home closings fell to 83.0% of closings from 94.2% of closings.
The average unit size of newly sold homes dropped 11.6% year-over-year to 1,641 square feet in May 2016. The average size of newly sold homes moved from 2,212 square feet in April 2015 to 2,042 square feet in April 2016.
Foreclosures and real estate owned (REO) closings continued to decline from a year earlier in May, but did not appear to be dragging the market. Combined, foreclosures plus REO closings accounted for 7.2% of existing home closings, below 8.1% a year earlier. The percentage of existing home closings involving foreclosures went from 3.0% in May 2015 to 2.6% in May 2016 and REO closings moved from 5.1% of existing home closings in May 2015 to 4.5% in May 2016.