MARKET SNAPSHOT – CITY OF CHICAGO*The City of Chicago Market Snapshot represents the residential real estate activity within the 77 officially defined Chicago community areas as provided by the Chicago Association of REALTORS®.
- In August 2016, 2,802 homes sold in the City of Chicago. This is a 3.7 percent increase from August 2015.
- The median sales price in the City of Chicago for August 2016 was $273,500, up 0.9 from this time last year.
- The City of Chicago saw listings average 68 days on the market until contract, a 6.8 percent decrease from 73 days in August 2015.
- Check out the August 2016 FastStats.
MARKET SNAPSHOT – CHICAGO PMSA*The Chicago PMSA Market Snapshot represents the U.S. Census Bureau’s definition of the nine-county Chicago area, including areas that would qualify as metropolitan areas on their own, yet are linked to other cities in close proximity. The Chicago PMSA includes the counties of Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will.
- In August 2016, 11,906 homes sold in the Chicago PMSA. This is a 7.6 percent increase from August 2015.
- The median sales price in the Chicago PMSA for August 2016 was $230,000, up 4.5 percent from this time last year.
STATE OF THE MARKET
- “We saw a strong surge of late-summer buying in August which lifted sales to positive annual gains,” Dan Wagner, president of the Chicago Association of REALTORS® and senior vice president of government relations at the Inland Real Estate Group of Companies, Inc. “The downside to this is that inventories in the city of Chicago saw a notable 14.7 percent decline, making August the fifth month in a row where we’ve seen double-digit percentage decreases in the number of homes for sale.”
- Closed sales began to cool for much of the country last month, and conventional wisdom indicates that year-over-year declines are going to be present for the remainder of the year, given the low inventory situation in most markets. Demand is certainly present and has created competitive situations that have kept prices up. Rental prices are also up, which may lure more toward homeownership.
- As inventory continues to drop, the contradictions of today’s market are evident. Sellers should feel confident enough to list homes at fair prices and receive meaningful offers in a healthy residential real estate and overall economic environment. However, there may be lingering worry over the availability of move-in ready homes to replace what was sold. On a brighter note, building permits are trending upward. That news should be weighed against the fact that the highest level of activity is in multifamily rentals.
- Consumer sentiment about the housing market is positive, and mortgage rates continue to be affordable. The August bounce in home sales caps off a strong start to the year and bodes well as we head into fall.
- City of Chicago inventory is down 13.8 percent, from 10,437 in August 2015, to 8,998 in August 2016.
- In the City of Chicago, the month’s supply of inventory is down 19.6 percent, from 4.6 in August 2015 to 3.7 in August 2016.
- The median price forecast indicates moderate annual growth in the Chicago PMSA. Median price increases of 2.5 percent in September, 1.8 percent in October and 1.6 percent in November are forecast.
- Another trend to watch: more homeowners are applying for home equity lines of credit, a sign that increasing home prices are enabling more homeowners to tap into increased home equity.
- Read the REAL Forecast in full.
- In August 2016, 1,927 houses were newly filed for foreclosure in the Chicago PMSA and 1,724 foreclosures were completed. As of August 2016, there are 40,154 homes at some stage of foreclosure – the foreclosure inventory.
Housing Continues to Be a Bright Spot in the Economy
- In the September Outlook, Freddie Mac Chief Economist Sean Becketti says, “The housing market remains a bright spot for the U.S. economy, with solid job gains and low mortgage interest rates sustaining the economy’s momentum in September. In most markets, low mortgage rates have more than offset the rise in house prices, preserving homebuyer affordability for the typical household. Homeowners are also taking advantage of low rates and house price appreciation that is increasing their home equity.”
- Read Freddie Mac’s September Outlook.
U.S. Household Income Making Gains
- According to U.S. Census data, the median household income for U.S. families rose to $56,500 in 2015, a 5.2 percent increase from the year before.
- Read more from The New York Times.
More U.S. Homeowners Regaining Equity
- The number of U.S. homeowners with positive equity in their homes rose in the second quarter of 2016, according to the latest report from CoreLogic. During that period, another 548,000 homeowners regained positive equity, bringing the total to approximately 47.2 million homes, or 92.9 percent of all U.S. mortgaged properties.
- Read more from CoreLogic’s report.