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Wisconsin’s Real Estate Market Shows Promise for Investors

Madison & Wilwaukee, WI Are Growing Fast

The Wisconsin real estate market has remained active through 2022 and is trending like many other markets. Sales have kept a steady pace, home values are starting to inch slightly downward, and inventory is increasing – all indicators of a potential market cooldown.

As Wisconsin’s real estate market changes, cities like Madison and Milwaukee continue to bring people to the Dairy State, indicating that the overall fundamentals in Wisconsin remain strong.

Milwaukee’s Housing and Rental Markets

Milwaukee real estate investing has been popular among investors, both seasoned experts and those just getting started in real estate investing. The demand for rental property is robust, with investors purchasing almost $140 million worth of homes in Milwaukee in Q1 2022.

Milwaukee also is a popular multifamily fix and flip market, and ranks among the top 10 cities for conversions of older commercial buildings into residential rental units.

While Milwaukee rental rates are below the national average, they’re still solid. In fact, Milwaukee ranked fifth out of 15 large metro areas for affordability where the average cost of rent was compared to median wages.

The analyzed real estate market data showed that monthly rent came out to around $1,038, and hourly wages were calculated at $21 an hour — estimating that a renter would have to work 50 hours a month to cover rent. That affordability means higher occupancy rates, but still room for growth.

Madison’s Housing and Rental Markets

Madison, Wisconsin’s housing market — particularly real estate investing – has played a huge role in the city’s economic success. Madison real estate values are growing on par with the national average, but home prices have outpaced the rest of the state.

The median sales price of SFR homes in Wisconsin increased from roughly $230,000 in January 2022 to $270,000 in September. Comparatively, the median sales price of Madison homes was $355,200 in September – an increase of $32,750 from January 2022.

Despite low inventory, high prices, and stiff competition, homebuyers in the Madison, WI area are beginning to see some reprieve. Due to the rising mortgage interest rates in the market, some properties in the Madison area have seen price adjustments.

The Madison rental market paints a similar picture. Rent has increased for one, two, and three-bedroom apartments over the past year. However, over the past month, rent for studio and one-bedroom apartments decreased — again indicating that the Madison rental market may have peaked when it comes to investment opportunity.

The rental demand is great news for real estate investors. The more individuals and families in need of housing means greater income potential for rental property investors. Considering the demand for rental properties in Madison and Milwaukee combined with the booming new construction real estate market that is sweeping the nation, these Wisconsin cities hold prime opportunities for real estate investors.

New Construction is Booming in Wisconsin

Like nearby Chicago, Madison and Milwaukee have become two of the best markets for real estate investing. As demand for housing increases, more and more investors are turning to ground-up construction and build-to-rent investment properties to meet the need.

Over the past 10 years, multifamily homes have popped up all across Madison. Residents are seeing new apartment complexes where empty fields once stood. Part of the multifamily market growth can be attributed to the city’s strong economic sectors in healthcare and technology, which are driving employment and attracting residents. In addition, student activity and tourism support a vibrant retail economy.

Milwaukee has turned into a great investment hub for rental and fix and flip investors interested in generating wealth through income properties. Over the past year, more than 650 houses were flipped in Milwaukee.

Recently, the city announced it would sell 150 vacant houses to be renovated into affordable housing in the city, creating a great opportunity for investors interested in fix and flip investments as well as ground-up construction financing, and who see the potential to add housing in the city’s opportunity zones.

An Investor's Guide to Wisconsin Real Estate

The state of Wisconsin has no shortage of opportunities for real estate investors. Don’t miss out on investment properties and growing your real estate investment portfolio because you’re not working with the right lender. Let Lima One help you close more deals faster.

With a nationwide presence as a trusted private lender, we offer a robust suite of products designed to help every investor regardless of their investment strategy. As the premier lender for real estate investors, our goal is to help investors scale their business and close deals quickly.

Whether you’re looking for new construction loans in Wisconsin or hard money construction loans to continue projects in Milwaukee or Madison, Lima One can help.

Our clients have different investment strategies, so we have designed our loan options to allow us to cater to their individualized needs. Contact us today to discuss your next deal, or if you have a deal in hand, accelerate the process by applying now.