I really don't believe in averages. I have seen homes for over asking price and under asking price anywhere from 2% to 25%. If you are working with an agent and you find a home that you wish to make an offer on, you would ask him or her to do a cma in the area. That will be helpful, however, still not the deciding factor. Some people will take say 3 homes - one is $150,000, one is $200,000 and one is $300,000. Then they add them together and divide by 3, giving an average selling price of $216,666.....
This calculation simply does not work in real estate. As you said yourself, there are many factors involved in deciding on what you should offer on a home.
1. What do you qualify for?
2. How does the home suit your needs?
3. Does the location make sense for you?
I could go on and on, but the bottom line is..........you might pay $150,000 for a home that someone else would be willing to pay $175,000 for.
What you do need to be concerned with is what is the appraiser going to think it's worth -that is, if you're getting financing. No matter what you think it is worth, the bank must agree or you don't get the loan.
And keep in mind that the value of conventional sales in Wisconsin are being brought down by the surrounding sales regardless of whether they are shortsales or foreclosures.
Hope this was helpful.