Housing is big news this week. Chicago’s real estate experts and some agents have been chiming in about July’s hot sales. The Sun-Times even put rising real estate prices on the front page.
From the Tribune:
Despite the positive report, the local housing market’s recovery continues to be uneven. Unlike eight to 10 years ago and except for investors, people who are priced out of choice neighborhoods are not looking at fringe neighborhoods in search of a good deal and future appreciation, said Zeke Morris, president of the Chicago Association of Realtors.
“We still need pioneers, people who are willing to take that chance in neighborhoods,” Morris said. “I’m happier that our median price is moving up. The only thing I caution people about is, the top half of the median is not the problem. The bottom half is the problem. How do we get prices at the lower half of the median moving up?”
In July, the median sales price of a home sold in the nine-county Chicago area rose 18.3 percent from a year ago, to $201,075, the Illinois Association of Realtors reported Wednesday. The median price of a home sold within the city increased 25 percent year over year, to $250,000.
While those kind of numbers seem reminiscent of the bubble years of runaway home prices, that’s not the case this time, real estate agents say. They add that homeowners who expect their properties to fetch unrealistically high prices are being urged to ratchet down their expectations.
“We’re not seeing prices skyrocketing,” said Michael Golden, a co-founder of @properties. “Pricing is still very moderate. The market today is much more thoughtful, much more careful, even though it is hotter than it was two years ago.”
The slower pace of activity that Prudential Rubloff agent Francesca Rose has seen in August is welcome because it means a more balanced market and a less-panicked buyer.
“The nervousness and the panic, people feel like they’re going to make the wrong decision,” Rose said, adding: “When we say it’s slow, it’s relative. It’s slow relative to April.”
The Sun-Times covers the bidding wars but also talks about slowing in August.
“The inventories are so low that there’s really no place for prices to go but up,” said broker Leigh Marcus of @properties. Marcus works Chicago neighborhoods from the South Loop to Rogers Park, and he reports brisk sales and bidding wars for homes with attractive features.
He handled such a sale in July for Joe Chasen, an options trader at the Chicago Board of Trade. Chasen said the Bucktown rowhome sold in three days and drew a strong response because of features such as a yard and rooftop party space.
Marcus said it sold for $861,500 and that six offers were made, all above the asking price.
Chasen said he bought a house in Glenview before selling in Bucktown and had to beat out other bidders. “I think I hit the market at a good time, just before interest rates began to tick up,” he said.
Marcus said the higher rates are just now having an effect. He said he detected a slowdown in sales starting in August beyond the typical impact of vacations and back-to-school preparations.
Wesbury, however, said the market will take the rates in stride. He said that with more confidence in place, “buyers are more willing to buy than back when rates were lower but buyers thought home prices might fall further.”
Will the experts be right about August cooling?
July’s heady housing gains in, around Chicago not expected to be replicated [Chicago Tribune, Mary Ellen Podmolik, August 22, 2013]
Housing market heats up in Chicago area with July sales up 36.1% [Sun-Times, David Roeder, August 22, 2013]