Optimal Buyer Market Conditions Linger in Illinois Housing Market

by Chicago Agent

Buyer market conditions remain in most Illinois housing markets as low mortgage interest rates helped spur some early buying in January despite typical slower sales for the winter month.

More than half of Illinois counties reported year-over-year increases or no change in home sales for January. According to the Illinois Association of Realtors’ latest report, statewide total home sales in January 2011 totaled 5,489 homes sold, down 1.8 percent from January 2010 sales of 5,588 homes. The median price in January 2011 was $136,000, down 6.2 percent from $145,000 in January 2010.

“Despite all odds, weather and economic factors included, the Illinois housing market did show some resiliency in terms of statewide home sales off less than two percent from January 2010 and up 14 percent from January 2009,” says Realtor Sheryl Grider Whitehurst, ABR, CRB, GRI, president of the Illinois Association of Realtors. “We are seeing more buyers taking advantage of the low mortgage interest rates while they are still here.”

In the Chicagoland Primary Metropolitan Statistical Area (PMSA), total home sales in January 2011 were down 2.0 percent, totaling 3,844 homes sold compared to January 2010 sales of 3,921 homes. The median price in January 2011 was $158,000, down 9.7 percent from $175,000 in January 2010.

The monthly average commitment rate for a 30-year, fixed-rate mortgage for the North Central region was 4.80 percent in January 2011, up from 4.72 percent during the previous month, according to the Federal Home Loan Mortgage Corporation. Last year in January it averaged 5.06 percent.

“The sales volume for the first month of 2011 was a fairly promising signal. Sales declined by a very small amount in January year-over-year and would have been higher than 2010 had the effect of the homebuyer tax credit been removed,” notes Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois. “Prices, however, are still being challenged by the volume of distressed properties on the market.”

In the city of Chicago, January total home sales were down 14.0 percent to 1,034 sales compared to 1,202 homes sold in January 2010. The city of Chicago median price in January 2011 was $170,000 down 12.8 percent compared to $195,000 a year ago in January 2010.

“The city of Chicago in January saw slow movement of inventory, with 14 percent fewer homes sold in January 2011 over the first month of 2010. This differential was expected given the federal tax credit that incentivized the market last year, and will likely show the same through the early spring,” says Mabel Guzman, president of the Chicago Association of Realtors. “A decrease in the median price of condos purchased in Chicago by 14.6 percent to $239,000 in January 2011 is indicative of the downward pressure distressed properties continue to have on our market, and the challenges buyers face in securing condo financing.”

Find Illinois market stats data at www.illinoisrealtor.org/marketstats.

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