Home sales and prices are up, leading indicators show
BY KAY SEVERINSEN - CMS Digital Editor
Priced for a bidding war, this Wicker Park greystone drew 25-30 people for a recent open house. | Courtesy Mike McElroy ~ Access Chicago Realty
What are we to make of the newest numbers on Chicago area home sales? Some show growth and positive energy, while others seem to indicate we lag the nation in home price upticks.
New numbers from the Illinois Association of Realtors show that Chicago's nine-county area saw a 19.2 percent month-over-month increase in December 2012 over December 2011. For the whole year, 2012 totaled 90,365 sales, up 26 percent from 2011. December's median price was $151,500, up 4.5 percent over that month last year.
New Zillow numbers indicate that the real estate rebound is more robust in almost every region of the nation than Chicago.
But one thing to keep in mind is that the more localized the data, the more accurate it is. National statistics for the entire year of 2012, such as those from Zillow this week, give a broad national overview, but local statistics for month over month pricing or neighborhood by neighborhood median prices give a better view for buyers and sellers in those areas.
"When they say real estate is local, they really mean it," says Mike McElroy, a frequent contributor to this site and broker of Access Chicago Realty. "Numbers will vary from neighborhood to neighborhood and zip code to zip code. Especially when you're looking at the entire city of Chicago, which includes both River North and Englewood," two very different neighborhoods that both contribute to a median price for Chicago.
(McElroy is an occasional contributor to SearchChicago-Homes. He is broker/owner of Access Chicago Realty and a board member of the Chicago Association of Realtors Young Professionals Network.)
"Month over month numbers don't always give you enough data to see how a neighborhood is doing," he said, "but you can look at the median price over 12 months and see how it's doing compared to the 12 months before that. For example, by that measure, the median price for all property types in the 60622 (Wicker Park) zip was up 4.3 per cent in 2012. River North (60654) was up 3.6 per cent, and 60614 (Lincoln Park) was up 1.8 per cent."
Regionally, the Illinois Association of Realtors reports, single family home sales were up 17.1 percent in December with prices showing a 4.3 percent increase; while total condo sales were up 23.1 percent, with prices showing a 6.5 percent gain.
Narrowing the focus to the city, Chicago saw a 14.6 percent year over year increase in sales while condo sales increased 17. 7 per cent, year over year. Home prices were up 19.4 percent overall in December versus the same month in 2011.
Another key indicator - the number of days a home sits unsold - is down 17.5 percent, from 103 days to 85.
The decrease in time on market, says Zeke Morris, president of the Chicago Association of Realtors, "shows a continued clearing of inventory, of both single-family homes and condominiums."
But compared to other regions of the country, our year-over-year numbers are not so impressive. Zillow reports that nearly every national market saw big price gains in 2012. Cincinnati and Chicago regions were the two that didn't. Our median sales price in 2012 was $160,000, down 1.5 percent from $162,500 in 2011.
Many of the regions that did well in the Zillow report are in California, but notable increases showed also showed up in Phoenix (up 22.5 percent); Las Vegas (up 13.9 percent); Portland, Ore., (up 7.7 percent) and Orlando (up 6.5 percent); and Denver (up 12.1 percent).
"The numbers for the state for 2012 are very encouraging," McElroy said. "Price appreciation will come, but first we had to work through the excess inventory built up over the past few years. Now that the overall number of sales is up, prices can start building toward a real recovery."