Illinois home sales reversed course in June with statewide home sales experiencing a slight year-over-year gain for the first time this year. Home prices continued to climb and marked the 22nd consecutive month of annual increases, according to the Illinois Association of Realtors (IAR).
Statewide home sales (including single-family homes and condominiums) in June 2014 totaled 15,661 homes sold, up 0.1 percent from 15,640 in June 2013.
The statewide median price in June was $179,900, up 5.8 percent from June 2013 when the median price was $170,000. The median is a typical market price where half the homes sold for more and half sold for less.
“After several months of declining annual sales, it’s great to see home sales come roaring back,” said Phil Chiles, ABR, CRS, GRI, SRES, president of IAR and broker-associate with The Real Estate Group in Springfield. “Increasing prices and sales point to an improving economic situation and a strengthening real estate market.”
Fewer homes on the market this year has translated into faster sales times. According to the data, it took 68 days on average to sell a home in the state, down 10.5 percent from 76 days last year. The average time to sell a home in the Chicago area was 53 days in June, and 44 days in Chicago.
The monthly average commitment rate for a 30-year, fixed-rate mortgage for the North Central region was 4.17 percent in June 2014, down from 4.18 percent in May, according to the Federal Home Loan Mortgage Corp. In June 2013 it averaged 4.09 percent.
In the nine-county Chicago Primary Metropolitan Statistical Area (PMSA), home sales (single-family and condominiums) in June 2014 totaled 11,241 homes sold, down 1.2 percent from June 2013 sales of 11,374 homes.
The median price in June 2014 was $220,000 in the Chicago PMSA, up 7.3 percent from $205,000 in June 2013.
“The volume of sales over the next three months (July, August and September) is forecast to match those recorded in 2013. In addition, median prices are continuing to climb while the REAL Housing Price Index suggests a slightly more optimistic growth rate when housing characteristics are taken into account,” noted Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory of the University of Illinois. “Further good news may be found in the Chicago foreclosure inventory; the average inventory change rates were -24.2 percent in the past six months, -14.3 percent in the last 12 months and -8.2 percent in the last 24 months. Given these rates of change, the foreclosure inventory would return to the pre-bubble levels by Oct. 2014, Dec. 2014 and May 2015 respectively.”
While Illinois’ foreclosure picture is brightening, foreclosures can negatively impact a neighborhood and a new research study by REAL puts a dollar figure on the potential impact to Chicago property values. For example, having one or two foreclosed properties within a tenth of mile to a home can reduce its price by $6,535, based on a $150,000 home.
Forty-three (43) of 102 counties in Illinois showed annual home sales increases in June 2014. Fifty-five (55) counties showed year-over-year median price increases including LaSalle, up 18.8 percent to $101,000; Kane up, 10.8 percent to $205,000; Cook, up 6.7 percent to $224,000; and Sangamon, up 6.3 percent to $146,750.
The city of Chicago saw a 1.2 percent year-over-year increase in home sales in June 2014 with 2,761 sales, up from 2,729 in June 2013. The median price rose to $275,000 versus $252,500 in June 2013, an annual increase of 8.9 percent.
“Home sales traditionally pick up in the summer months, and June was no exception. Chicago buyers helped reverse a year-over-year sales trend by buying more homes than last June,” said Matt Farrell, president of the Chicago Association of Realtors and managing partner of Urban Real Estate. “Demand continues to outpace home supply, and buyers are finding the home they want in a shorter amount of time. This continued to push median prices higher, putting sellers in a strong position.”