January Dane County Real Estate Market Update
What does the first full month of the year reveal about where the Madison-area housing market is heading next?
January is always a transition month in real estate. It’s when the market shakes off the holidays, sellers begin to prepare for spring, and buyers quietly re-enter before competition fully ramps up. The January Dane County single-family data gives us an early snapshot of how the 2026 market is positioning itself and what buyers and sellers should be paying attention to right now.
Before diving deeper, here’s the quick takeaway.
TL;DR – January Market Snapshot
- New listings increased 7% year over year, though delayed listings inflated the total
- Closed sales slowed seasonally, with 23% involving competition
- Cash offers continue to decline, creating more flexibility for financed buyers
- Even in competitive situations, homes sold slightly under list price
- January reflects a market reset, not a slowdown - spring conditions are likely to look very different
New Listings: A Seasonal Increase, Not a Surge
January saw 428 new single-family listings come on the market across Dane County, including 92 delayed listings. That’s a 7% increase compared to January of last year, when 401 homes were listed. For additional context, January 2021 saw 414 homes come on the market.
At first glance, this may feel like a meaningful jump in inventory. However, context matters.
January is typically when sellers begin positioning themselves for the spring market. Delayed listings play a role in boosting the headline number, and even with this increase, inventory remains well below what would be considered a balanced market. In other words, this is an early-year thaw, not a flood.
For sellers, this suggests that competition among listings is still limited. For buyers, it means options are beginning to open up, but leverage remains neighborhood- and price-point specific.
Closed Sales: A Predictable Post-Holiday Slowdown
There were 235 closed single-family home sales in January, down from December and slightly lower than January of last year, when 242 homes closed.
Of those January sales, 23% involved competing offers, compared to 24% one year ago.
This slowdown from December isn’t surprising. Fewer contracts are written during the holidays, which naturally impacts January closings. What’s more important is that competition hasn’t disappeared - it has simply become more selective.
Homes that are well-priced, well-located, and well-prepared are still seeing multiple offers, while others may sit longer. This pattern is typical for January and often changes quickly as spring approaches.
Cash Offers Continue to Decline
Cash continues to be part of the conversation, but the data tells an important story.
In January:
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15% of offers were written as cash
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21% of competing offers involved cash
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Only about 20% of those offers actually closed as true cash transactions (11 of 12)
This matters more than many people realize.
There’s still a common perception that buyers must write cash offers to compete in the Madison-area market. The January data does not support that idea. While cash can be useful in specific scenarios, strong financing, clean terms, and smart strategy remain highly effective.
For buyers, this means loan choice flexibility still exists. For sellers, it reinforces the importance of evaluating offers beyond just the word “cash.”
Pricing Trends in Competitive Situations
Looking specifically at homes that faced competition in January:
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Average list price: $514,000
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Average sale price: $511,000
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Median list price: $440,000
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Median sale price: $438,000
Even in competitive situations, homes sold slightly under list price on average.
This can feel counterintuitive, especially for those used to peak-market headlines. However, this behavior is typical for January. Buyer urgency tends to be lower early in the year, and sellers are often testing price as the market resets. These numbers should be viewed as seasonal, not directional.
As demand builds and inventory tightens in the coming months, pricing dynamics are likely to adjust quickly.
Why January and December Numbers Look So Different
It’s important not to compare January and December pricing without context.
December’s overall averages were higher, with:
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Average sale price: $562,000
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Median sale price: $465,000
December typically includes fewer total sales and a higher share of upper-end closings, which naturally pushes averages up. January, on the other hand, reflects broader market participation and more typical price ranges.
January is best understood as a reset month, not a signal of declining values or weakening demand.
What This Means Heading Into Spring
January’s data shows a market that is re-engaging after the holidays. Inventory is beginning to build modestly, competition is present but manageable, and pricing reflects seasonal norms rather than long-term shifts.
As we move into February and March, buyer activity typically accelerates faster than new inventory, especially in well-loved neighborhoods and mid-range price points. That’s when competition often intensifies.
Bottom line
January closed out as a stabilizing month for the Dane County housing market. The fundamentals remain intact, early seller activity is increasing, and buyers still have opportunities before spring conditions fully take hold.
The key takeaway isn’t what happened in January - it’s how quickly the market can change from here.
What Does This Mean for You?
Market stats only tell part of the story. How these trends affect you depends on your timing, your price point, and your neighborhood.
- Thinking about selling? Early preparation matters more than ever.
- Thinking about buying? This window can offer opportunity before competition peaks.
If you want to understand how these January trends apply to your specific situation, a personalized strategy matters far more than headlines.
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