The June sales data is out and as expected the slowdown in sales continued as the median kept rising.
From the Illinois Association of Realtors:
“The city of Chicago saw a 1.2 percent year-over-year increase in home sales in June 2014 with 2,761 sales, up from 2,729 in June 2013. The median price rose to $275,000 versus $252,500 in June 2013, an annual increase of 8.9 percent.”
Thanks to G for the historical sales data:
- June 2014: 2761 sales
- June 2013: 2729
- June 2012: 2246
- June 2011: 1841
- June 2010: 2526 (tax credit sales)
- June 2009: 1981
- June 2008: 2282
- June 2007: 3,127
- June 2006: 3,557
- June 2005: 3,850
- June 2004: 3,752
- June 2003: 2,891
- June 2002: 2,590
- June 2001: 2,451
- June 2000: 2,513
- June 1999: 2,435
- June 1998: 2,214
- June 1997: 1,817
Here is the monthly median price data:
- June 2014: $275,000
- June 2013: $254,900
- June 2012: $216,700
- June 2011: $207,000
- June 2010: $234,250
- June 2009: $242,050
- June 2008: $309,945
“Home sales traditionally pick up in the summer months, and June was no exception. Chicago buyers helped reverse a year-over-year sales trend by buying more homes than last June,” said Matt Farrell, president of the Chicago Association of REALTORS® and managing partner of Urban Real Estate. “Demand continues to outpace home supply, and buyers are finding the home they want in a shorter amount of time. This continued to push median prices higher, putting sellers in a strong position.”
“The volume of sales over the next three months (July, August and September) is forecast to match those recorded in 2013. In addition, median prices are continuing to climb while the REAL Housing Price Index suggests a slightly more optimistic growth rate when housing characteristics are taken into account,” noted Geoffrey J.D. Hewings, Director of the Regional Economics Applications Laboratory of the University of Illinois.
“Further good news may be found in the Chicago foreclosure inventory; the average inventory change rates were -24.2 percent in the past 6 months, -14.3 percent in the last 12 months and -8.2 percent in the last 24 months. Given these rates of change, the foreclosure inventory would return to the pre-bubble levels by Oct 2014, Dec 2014 and May 2015 respectively,” he said.
Last year, July, August and September sales volumes fell due to rising mortgage rates so the year over year change in sales isn’t expected to be as dramatic as the first half of this year.
Purchase mortgage applications remain at 15-year lows. And all cash buyers remain at an usually high level. Historically, nationally, cash buyers make up about 5-10% of the market. Right now, it is still around 30%.
DR Horton, one of the largest home builders, reported earnings this week and blamed its weak results on the Chicagoland area saying:
“The third quarter results included $54.7 million in pre-tax charges to cost of sales for inventory impairments, primarily related to active communities in the Midwest region in Chicago that were purchased from 2004 to 2007 and had been previously impaired. The Chicago housing market remains weak, with sales absorptions and returns in these communities performing below management’s expectations. During the quarter, the Company took actions to increase sales pace, reduce inventories and improve cash flows and returns in these communities which resulted in these impairment charges.”
Is the glass half full (as the IAR sees it) or half empty (as DR Horton see it)?
Illinois home sales see slight uptick in June; Prices continue annual upward trend [Illinois Association of Realtors, Press Release, July 22, 2014]