Home sales in the nine-county Chicago area posted big increases in March, signaling a bright start to the spring selling season.
Counting single family and condos, sales for March were up 23.8 percent from a year ago to totaled 6,590 homes, while in the city of Chicago, sales posted a 12.1 percent year-over-year increase.
Bob Floss, the president of the Chicago Association of Realtors, said a number of positive factors have contributed to the promising spike in activity.
“Realtors are continuing to see an increase in the number of buyers looking to buy a home today, as rents are going up and interest rates are at an all-time low,” Floss said. “While we are still closely monitoring the impact of distressed properties now and those that may enter the market in the coming year, continued stabilization of the market will ultimately come from buyers looking to make a long-term investment in a community with the dollars they invest today.”
Even more encouraging was the median home sale price in Chicago, which was up 5.2 percent in March from last year. For the nine-county area, prices were down 3.9 percent year-over-year.
Dr. Geoffrey J.D. Hewings, the director of the Regional Economics Applications Laboratory of the University of Illinois, said the latest data on sales volume, pricing and other details are promising.
“There are encouraging signs in the market,” Hewings said. “Sales volumes are up, time-on-the-market levels are down significantly from a year ago and prices appear to be stabilizing in Illinois although continuing to fall in Chicago. Further, in the last month there was a more even spread of sales prices compared to previous months where homes sold for less than $200,000 dominated the market.”
Statewide, Illinois home sales surged to double-digit increases and their best levels in four years, according to data from the Illinois Association of Realtors (IAR).
Rising 21.1 percent from last year, 9,575 homes were sold in March, which is the month’s best performance since 2007. Even more promising were prices, which snapped a 20-month streak of declines and maintained levels with March 2011.
Loretta Alonzo, the president of IAR, said the strength of the new sales data, and what it means for the spring selling season, could not be more obvious.
“There’s no doubt that these are strong numbers to open the spring selling season,” Alonzo said. “To see such good sales numbers, coupled with a measure of price stability is encouraging news no matter what side of a real estate transaction you happen to be on.”
Alonzo credited the foreclosure markets, which have been clearing out as of late, and record-low mortgage rates as big contributors to March’s sales activity, in addition to the many affordable homes currently available.
Existing-home sales were in March maintained year-over-year increases, according to new data from the National Association of Realtors (NAR).
Total existing-home sales, which includes the completed transactions of single-family homes, townhouses, co-ops and condos, increased 5.2 percent above the 4.26 million in March 2011, but were down 2.6 percent from February to March to a seasonally adjusted annual rate of 4.48 million.
Moe Veissi, the president of NAR, said that compared to last year, there is a definite uptick in sales activity.
“Our members are reporting an increase in foot traffic from a year ago, but more importantly, home shoppers this year are much more serious about finding the right home and making an offer,” Veissi said. “Stabilizing home prices and historically favorable affordability conditions are giving buyers more confidence, and Realtors have become more optimistic since the beginning of the year from the positive shift in buyer patterns.”
Lawrence Yun, NAR’s chief economist, said that despite the uneven nature of the housing recovery, there are definite incentives in today’s real estate market.
“The recovery is happening though not at a breakout pace, but we have seen nine consecutive months of year-over-year sales increases,” Yun said. “Existing-home sales are moving up and down in a fairly narrow range that is well above the level of activity during the first half of last year. With job growth, low interest rates, bargain home prices and an improving economy, the pent-up demand is coming to market and we expect housing to be notably better this year.”
Housing inventory also declined in March, falling another 1.3 percent to 2.37 million existing homes, or a 6.3-month supply. Total listed inventory is 21.8 percent lower than in 2011, and is even further from the 4.04 million properties that were listed in July 2007, when inventories peaked.
Though NAR had previously been optimistic about the inventory declines, given the thorny nature of excess housing and its impact on price, Yun did mention some of the trend’s negatives, which we’ve reported on before.
“We were expecting a seasonal increase in home listings, but a lack of inventory has suddenly become an issue in several markets with not enough homes for sale in relation to buyer interest,” Yun said. “Home sales could be held back because of supply factors and not by demand – we’re already seeing this in the Western states and in South Florida.”