SPRINGFIELD, Ill. — Illinois home sales have been trending positive month-to-month since February 2011 and median home prices have moved up for the last three consecutive months, all good signs for a market working to recover amid lackluster job creation and a restrictive lending environment. According to the Illinois Association of REALTORS® (IAR) latest report, statewide home sales (including single family and condominiums) in May 2011 totaled 9,736 homes sold, up 13.9 percent from 8,546 sales in April 2011; sales were down 16.8 % from 11,705 homes sold in May 2010.
The median price in May was $140,000, up 2.9 % from $136,000 in April 2011 and down 10.8 percent from last year in May when it was $157,000. The median is a typical market price where half the homes sold for more, half sold for less.
“The trend in rising home sales and median prices is a positive direction for the housing market as a whole as the strong buyer’s market and high affordability conditions continue. Also of note, this year there is no tax credit incentive yet home sales remain above 2009’s accelerated sales from the stimulus program,” 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. “Brokers across the state are reporting the biggest road block for getting a home loan today is lending requirements that are too strict for even qualified buyers. A return to more robust yet responsible lending will result in more closed transactions and a stronger economy.”
Adds Whitehurst: “The economic impact of a healthy housing market cannot be discounted. Just one home sale in Illinois generates $28,581 in direct expenditures made by both the seller and the buyer, according to a study by Chicago-based RCF Economic and Financial Consulting. The resulting ripple effect across multiple industries for home improvements, moving and warehousing and others adds up to $7.9 billion a year in direct and indirect expenditures fueling the Illinois economy plus 85,677 jobs.”
In the Chicagoland Primary Metropolitan Statistical Area (PMSA), home sales (single family and condominiums) totaled 6,608 homes sold, up 15.7 % from 5,710 sales in April 2011 and down 12.8 % from May 2010 sales of 7,580 homes. The median price in May 2011 was $169,900 in the Chicago region, up 4.6 % from $162,500 in April 2011 and down 10.8 % compared to last year in May when it was $190,500.
The monthly average commitment rate for a 30-year, fixed-rate mortgage for the North Central region was 4.67 % in May 2011, lower than 4.87 % during the previous month, according to the Federal Home Loan Mortgage Corporation. Last year in May it averaged 4.91 percent.
“According to our forecast, annual sales rates will turn positive for both Illinois and the Chicago region in July and August, a 22-25 % increase statewide and 25 to 36 percent for Chicago,” estimates Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois. “This means the effect of the homebuyer tax credit will finally fade out in Illinois during the summer. Median prices for June, July and August are expected to be higher than May in both Illinois and the Chicago region.”
In the city of Chicago, May home sales (single family and condominiums) totaled 1,705, up 16.5 % from 1,464 sales in the previous month and down 17.1 % from 2,057 homes sold in May 2010.
The city of Chicago year-over-year median price for single family and condominiums in May 2011 was $238,450 up 3.7 percent compared to $230,000 in May 2010; it was 16.0 percent higher compared to the previous month of April 2011 when it was $205,500. For condominiums specifically, the median price reached $299,000 in May 2011, up 10.3 percent year-over-year from $271,150 in May 2010.
“Chicago’s condo sales in May outpaced single family homes by nearly 30 %, a strong indicator that the condo market is re-emerging as a viable and affordable housing choice. We continue to monitor the impact of condo financing options and distressed condo units and how they will shape sales in the remainder of 2011,” said Mabel Guzman, president of the Chicago Association of REALTORS® and a REALTOR® with Envision Real Estate LLC, Chicago. “Sellers this summer have the opportunity to position their home with a compelling sales price, and leverage low interest rates on the purchase of their next home.”
Thirty-six of 100 Illinois counties reporting showed year-over-year median price increases or no change for the month of May including Grundy, up 3.2 percent to $150,100; LaSalle, up 11.0 % to $102,125; Macon, up 1.2 % to $87,500; Sangamon, up 10.4 % to $139,900; Stephenson, up 23.4 % to $97,500 and Whiteside, up 4.1 % to $82,500.
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 May 1 through May 31, 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 44,000 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.