IAR: Chicagoland’s July Housing Market a Familiar Sight

by Peter Thomas Ricci

Stop us if you’ve heard this one before: sales were down and prices were up in the Chicagoland housing market.

The July housing market in Chicagoland offered yet another chapter to the 2014 storybook of falling sales and rising prices.

According to the latest numbers from IAR, home sales in the nine-county Chicagoland area were down 8.0 percent year-over-year to 11,125, while median price rose 9.0 percent to $218,000.

Geoffrey J.D. Hewings, the director of the Regional Economics Applications Laboratory of the University of Illinois, pointed out that though 2014’s sales have paled in comparison to 2013’s extravagant numbers, they are still ahead of the worst years of the downturn.

“While sales in July were weaker than last year, they are still stronger for the same month in any other year between 2008 and 2012. Once again, median prices are still growing robustly,” Hewings said. “If the current foreclosure inventory continues to decrease at recent rates, then the inventory will return to pre-recession levels by the end of the year in Illinois.”

Real Estate Tradeoffs in the City and Suburbs

In the city of Chicago, the numbers were strikingly similar to the general area. Sales were down 8.2 percent year-over-year in July, while median price rose 8.0 percent to $270,000. Matt Farrell, the president of the Chicago Association of Realtors, said that inventory remains low in Chicago, as does interest rates.

“Inventory remains low even when the summer season is popular with sellers looking to move,” Farrell said. “Now is an ideal time for sellers to contemplate their own long-term plans and consider preparing their home for a fall sale. Interest rates remain historically low, and buyers are still seeking homes in a market with a shortage of housing options.”

Meanwhile, in suburban Chicago, the median price of single-family detached homes rose 5.7 percent year-over-year in July, according to stats from the Mainstreet Organization of Realtors. Michael Parent, MORe’s current president, said he expects closings to increase in the fall, given the level of contract activity he’s observed.

“The number of suburban homes under contract continues to trend strong, which will lead to more closings in the fall,” Parent said. “During July and August, buyers typically put their home search on the back burner in favor of family vacations. Market activity cools, then heats back up in September and October.”

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