Madison housing prices increase for 7th year in a row
City says housing supply isn't meeting demand, which is driving up prices each year
MADISON, Wis. — The Office of the City Assessor of Madison released a report Friday stating that Madison’s real estate increased by 6.6% in the last year, making this the 7th year in a row that prices of homes have increased.
The average cost of a single-family home is now just over $315,000 according to city assessor Michelle Drea.
“Most areas in Madison have robust sales and without fail, it’s pretty common for the sales to be above what we have them assessed at,” Drea said.
Drea said the housing prices continue to see an upward trend because the supply of homes can’t keep up with the demand for them.
“Madison is known as a great city. Lots of people want to live here,” Drea said.
According to a Dane County Housing Initiative Report, the number of housing units in Dane County has only grown by 1.1% each year. Meanwhile, household income and population in Dane County have all grown at an average rate of 1.3% each year from 2010-2017. The report also states that rent has increased an average of 2.3% per year.
“You have so much competition in the market to buy homes. It’s not a simple equation if you’re looking at providing affordable housing. It can be more of a challenge. I think it just requires a more thoughtful approach,” Drea said.
The DCHI report also found that even though Dane County produced more than 25,000 new housing units from 2006-2017, it under-produced more than 11,000 housing units relative to household growth. Vacancies for multifamily rentals in Madison, Middleton, Monona and Fitchburg remain below 5%.
Drea said more affordable housing units need to be built in order to help slow the increase of the prices of homes.
“Affordable housing is one of Mayor Satya’s priorities,” Drea said. “So, I do think that those developments are important and will increase over time.”
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