Spring Brings Double-Digit Price Increases to Chicagoland Market

by Peter Thomas Ricci

This year’s stellar home-price gains continued into the spring, according to CoreLogic’s latest analysis.

Home prices in the Chicagoland housing market rose 11.3 percent year-over-year in March, according to the latest Home Price Index from CoreLogic.

That was above the national average, which saw prices rise 11.1 percent year-over-year (the 25th consecutive month of such increases). In addition, prices were up 1.4 percent from February to March, though prices remain 16.0 percent below their April 2006 peak.

Home Price Slowdown

As distressed sales make up less and less of the market, though, home price gains are expected to wane; in March, for instance, prices were up 9.5 percent when distressed sales were excluded, and CoreLogic anticipates prices increasing a more modest 6.7 percent from now through March 2015.

Also, as Mark Fleming, CoreLogic’s chief economist, explained in comments accompanying the Home Price Index, March’s double-digit increases obscure other details of the housing market that warrant attention.

“March data on new and existing home sales was weaker than expected and is a cause for concern as we enter the spring buying season,” Fleming said. “Interest rate- disenfranchised potential sellers are adding to the existing shadow inventory, while buyers who can’t find what they want to buy are on the sidelines creating a new kind of ‘shadow demand.’ This supply and demand imbalance continues to drive home prices higher, even though transaction volumes are lower than expected.”

For a broader scope on the Home Price Index, see our graph below, which tracks the year-over-year increases for home prices by month:

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