CHICAGO—Homes across the state continue to sell at a relatively slow rate, but last month prices did increase 10.4% over the median in January 2014, which provides a solid start to the year, according officials from the Illinois Association of REALTORS®.
“The strong price surge in the first month of the year shows that even in a traditionally slow time for real estate there's enormous interest in finding a home to buy,” says Jim Kinney, president of the Springfield, IL-based realtor association and vice president for luxury sales at Baird & Warner in Chicago. “Those with homes on the market are definitely seeing traffic and with a slight reduction in inventory levels, sellers are able to command higher prices in many cases.”
The number of sales has continued on a downward trajectory. In January, just 7,824 homes were sold, down 4.3% from last January 2014, a month when especially poor weather conditions kept many potential buyers at home and only 8,178 homes were sold. But the statewide median price in January 2015 shot up to $150,000. Last January the median price was $135,850. Median prices have increased on an annual basis every month in Illinois since September 2012, according to the realtors.
“Once again prices and sales moved in opposite directions in January with the sales decline attributed to a lower completion rate for homes under contract in December,” says Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory at the University of Illinois. “In addition, foreclosure sales declined while sales of regular properties were almost the same as January 2014.”
Chicago's nine-county metropolitan area fit this pattern. A total of 5,619 homes, including condominiums, were sold last month, down 5.2% from the previous January. But the median price of a metropolitan area home in January was $176,000, up 8.0% from $163,000 in January 2014. And the city of Chicago saw sales of 1,295 homes last month, down 8.3% from last year. The median price of a home in Chicago was $222,000, up 11% over January 2014.
"Families and professionals have a strong desire to buy a home yet a full market recovery continues to be stalled by the limited homes for sale,” says Hugh Rider, president of the Chicago Association of REALTORS® and co-president of Realty & Mortgage Co. “Buyer demand on lower inventory is pushing up prices to offer sellers an incentive. With the winter thaw, we expect to see increased market growth as more homebuyers and homeowners see the opportunity to make the most of currently low interest rates."
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
