Year-over-Year Sales, Prices Still Influenced by Tax Credit
February home sales in Illinois rose from January while year-over-year comparisons still reflect an impact from the homebuyer tax credit incentive. The single family market shows signs of stabilization with steady median price gains statewide in the first two months of the year compared to 2009 and 2010 levels. According to the Illinois Association of REALTORS® latest report, statewide total home sales (which include single family and condominiums) in February 2011 totaled 5,575 homes sold, up 1.3 percent from 5,505 sales in January 2011 and down 10.0 percent from February 2010 sales of 6,194 homes.
The median price in February was $128,800, down 4.6 percent from $135,000 for the same month last year. The statewide single family median price reached $129,000, up 1.6 percent from $127,000 in February 2010 and up 2.8 percent from $125,500 in February 2009. The median is a typical market price where half the homes sold for more, half sold for less.
“We are seeing some improvements in the single family market in particular in terms of median prices trending higher and back to more sustainable pre-boom levels,” said REALTOR® Sheryl Grider Whitehurst, ABR, CRB, GRI, president of the Illinois Association of REALTORS® and the Development and Operations Coordinator for Traders Realty in Peoria. “More encouraging jobs signals and warmer weather should bring qualified buyers out from hibernation to grab hold of the low interest rates and high affordability factors in place for the spring market.”
Adds Whitehurst: “Another positive sign is more than half of Illinois counties reported median price increases or no change in February although markets permeated by distressed properties continue to be affected. The predominance of sales in lower priced tiers of the market also is reflected in the median price.”
In the Chicagoland Primary Metropolitan Statistical Area (PMSA), total home sales (single family and condominiums) in February 2011 were down 8.8 percent, totaling 3,769 homes sold compared to February 2010 sales of 4,134 homes. Home sales were down 2.0 percent from the previous month’s totals of 3,844 in January 2011. The median price in February 2011 was $152,500 in the Chicago region, down 7.6 percent from $165,000 in February 2010.
The monthly average commitment rate for a 30-year, fixed-rate mortgage for the North Central region was 5.0 percent in February 2011, up from 4.8 percent during the previous month, according to the Federal Home Loan Mortgage Corporation. Last year in February it averaged 5.01 percent.
“Sales are forecast to decline year-over-year for the next three months but this is not an extremely negative signal for Illinois and the Chicago PMSA housing markets taking into consideration that the early 2010 housing market was inflated by the homebuyer tax credit by 16.5 percent. This impact is reflected in the fact that we are expecting to see significant month-to-month sales increases for the next three months for both Illinois and the Chicago PMSA,” said Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois. “The housing price forecasts for both Illinois and the Chicago PMSA show month-to-month increases in March, April and May however the forecasted prices are still lower than last year during the same period.”
Adds Hewings: “The economy continues to provide some positive signs. National job gains in the last 12 months have amounted to 1.3 million, or an average of 106,000 jobs per month. Illinois added 64,200 jobs in the last year or an average of 5,350 jobs per month. Most analysts agree that a strong labor market will be the key to a housing market recovery.”
In the city of Chicago, February home sales (single family and condominiums) totaled 1,056, up 2.1 percent from the previous month 1,034 homes sold in January 2011 and down 13.8 percent from 1,225 homes sold in February 2010.
The city of Chicago median price in February 2011 was $177,500 up 0.6 percent compared to $176,500 a year ago in February 2010; the single family median price increased 21.9 percent in the month of February to $134,200 from $110,100 in February 2010.
“In the city of Chicago, both average price and median price have increased for single family detached over the same period in 2010. Buyers are finding significant value and gravitating toward the single family detached properties offering better financing options,” said Mabel Guzman, president of the Chicago Association of REALTORS® and a REALTOR® with Envision Real Estate LLC, Chicago. “Currently 90 percent of loans are government-sponsored enterprises, and with a 30 percent cap on condominium buildings qualified buyers are finding it more challenging to secure financing for their condo purchase. We are closely monitoring short sales in the city of Chicago, which are outpacing foreclosures, in order to track impact on communities throughout the city.”
More than half of Illinois counties reporting (49 of 97 counties) showed year-over-year median price increases or no change for the month of February including Adams, up 6.5 percent to $104,950; Champaign, up 8.4 percent to $126,000; Madison, up 15.7 percent to $109,950; McLean, up 2.0 percent to $153,000; Monroe, up 21.2 percent to $157,500; Sangamon, up 0.3 percent to $120,300; Tazewell, up 1.5 percent to $115,450; and Will, up 2.4 percent to $163,900.
Sales and price information is generated from a survey of Multiple Listing Service sales reported by 35 participating Illinois REALTOR® local boards and associations including Midwest Real Estate Data LLC for the period Feb. 1 through Feb. 28, 2011. The Chicagoland PMSA, as defined by the U.S. Census Bureau, includes the counties of Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will.
The Illinois Association of REALTORS® is a voluntary trade association whose 46,000 members are engaged in all facets of the real estate industry. In addition to serving the professional needs of its members, the Illinois Association of REALTORS® works to protect the rights of private property owners in the state by recommending and promoting legislation that safeguards and advances the interest of real property ownership.
Find Illinois market stats data at www.illinoisrealtor.org/marketstats.
NOTE TO EDITORS: Economist Geoff Hewings will be available for media interviews between 9 a.m. and noon CST on Monday, March 21.
CONTACT: Mary Schaefer, +1-217-529-2600
Web Site: http://www.illinoisrealtor.org
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Filed under: Real Estate
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