Chicago Market Conditions: January Sales Bounce Back for the Second Straight Month
The Illinois Association of Realtors is out with the January sales data and the Chicago housing market showed improvement for the second month in a row.
The city of Chicago saw year-over-year home sales increase 5.9 percent with 1,427 sales in January, compared to 1,347 a year ago. The median price of a home in the city of Chicago in January was $269,000 up 5.5 percent compared to January 2019 when it was $255,000.
January’s number was revised up considerably, as last year’s initial look was at an 8-year low of 1164 sales. Almost 200 further sales were eventually added to the month, putting it within the ballpark of prior years.
Sales Data Since 2006 (thanks to G for the older data):
- January 2006: 2009 sales and median price of $258,000
- January 2007: 1850 sales and median price of $279,900
- January 2008: 1203 sales and median price of $290,000
- January 2009: 918 sales and median price of $205,000
- January 2010: 1237 sales and median price of $195,000
- January 2011: 1034 sales and median price of $150,000
- January 2012: 1123 sales and median price of $149,000
- January 2013: 1521 sales and median price of $157,000
- January 2014: 1383 sales and median price of $200,750
- January 2015: 1348 sales and median price of $220,000
- January 2016: 1398 sales and median price of $227,750
- January 2017: 1574 sales and median price of $255,000
- January 2018: 1444 sales and median price of $265,000
- January 2019: 1347 sales and median price of $255,000
- January 2020: 1427 sales and median price of $269,000
“In January, we saw slight upward growth in closed sales and median sales price,” said Maurice Hampton, president of the Chicago Association of REALTORS® and owner of Centered International Realty. “We continue to see a downturn in inventory. The combination shows we still have demand, but without the inventory to show for it.”
The Illinois Association of Realtors busted out some Chicago specific data in a separate chart.
Condo sales were up 7.5% in the month to 771 sales. Single family home sales rose 4.1% to 656 sales.
Inventory in Chicago fell to 7190 from 7746 homes in 2019, down 7.2%.
The number of days on the market in Chicago also fell to 52 from 55 last year.
Inventory remains tight, as most buyers can confirm.
If you come on the market priced right, you are selling quickly.
“January started off the new year on a positive note with home sales and prices increasing month-over-month and annually, reflecting recent national sales trends,” said Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory at the University of Illinois. “The pending sales index suggests this momentum may be sustained for the next several months and consumers are optimistic about the short- and medium-term prospects for the economy. The major concern continues to be the amount of inventory for sale.”
The average thirty year mortgage rate remains favorable. It fell to 3.62% in January, down from 3.72% in December and down from January 2019 when it was 4.46%.
The 10-year treasury is sliding again. It’s possible that rates will fall further.
Will the tight inventory finally boost Chicago’s housing market this spring?
January brings uptick in Illinois home sales and prices [Illinois Association of Realtors, Press Release, February 21, 2020]
not only favorable weather but favorable interest rates compared to last year
I can’t imagine many were shopping for anything during that brutal cold stretch last year
“consumers are optimistic about the short- and medium-term prospects for the economy.”
…I very much doubt that statement. The only optimism that I see is maybe things won’t get much worse.
With the recent Coronovirus outbreak spreading worldwide and the liklihood of the virus making its way to Chicago at some point in time. Anyone have any guesses on how a quarantine will affect housing prices?
“consumers are optimistic about the short- and medium-term prospects for the economy.”
“Hold my beer”
Will be interesting to see how this affects March
“With the recent Coronovirus outbreak spreading worldwide and the liklihood of the virus making its way to Chicago at some point in time. Anyone have any guesses on how a quarantine will affect housing prices?”
One the one hand…on the other hand…https://themreport.com/daily-dose/02-25-2020/coronavirus-positive-impact-on-the-u-s-housing-market
“the Chinese real estate market has plummeted 90%”
citing to the WSJ, which certainly didn’t publish that exact clause. What is that supposed to mean???
On the other, other hand:
“Lipsitch predicts that within the coming year, some 40 to 70 percent of people around the world will be infected with the virus that causes COVID-19.”
https://www.theatlantic.com/health/archive/2020/02/covid-vaccine/607000/
“Lipsitch predicts that within the coming year, some 40 to 70 percent of people around the world will be infected with the virus that causes COVID-19.”
What a completely meaningless prediction, might as well say 1-100%
When should a mortgage be refinanced?
Some people — who work in the mortgage-lending industrial complex — recommend refinancing when the rate can be reduced by (only!) 50 bps.
If one agrees, it appears that nearly EVERYONE who took out a 30-year mortgage after Nov. 2016 is now far enough “in the money” to warrant getting a new, lower-cost mortgage.
“refinances, are surging right now. Applications to refinance a home loan are up around 165% annually, according to the Mortgage Bankers Association.”
The gravy train for mortgage lenders has returned.
https://fred.stlouisfed.org/series/MORTGAGE30US
“If one agrees, it appears that nearly EVERYONE who took out a 30-year mortgage after Nov. 2016 is now far enough “in the money” to warrant getting a new, lower-cost mortgage.”
Refis are up but they’re not surging. They’re not even close to, say, 2013 levels.
Most people will wait until there is a 2-handle in front of a 30-year before refinancing.
Bloomberg News reported yesterday:
Executives at four of the nation’s 15 biggest mortgage lenders … anticipate hiring thousands of employees this year to keep up with what they expect to be a flood of demand for purchase loans and refinancings.
Lenders are zipping through applications so fast that some expect to blow past origination records they set just last year. At Quicken Loans Inc., the nation’s largest mortgage lender, Monday was the busiest day for mortgage applications in the company’s 35-year history…. United Wholesale Mortgage, meanwhile, approved $2.5 billion of preliminary loans, a single-day record for the company….
The drop in rates … is taxing an industry that was operating near capacity and setting off a battle for talent.
Eric Mitchell … at Gold Star Mortgage Financial, is luring employees with signing bonuses and the chance to make big money. That assumes they’re willing to work long hours while the market stays hot.
“If you’re not making $1 million this year as a loan officer, you’re grossly incompetent,” Mitchell said.
Quicken expects to hire a few hundred new employees a month this year. United Wholesale Mortgage … the nation’s third-largest home lender, plans to hire another 2,000 people in 2020 after it doubled in size last year to roughly 5,400 employees.
In just three months, [Quicken] is on track to originate nearly half as many mortgages as it did all of last year.
2019 was a banner year [for loan originators], as trade wars and signs of a global economic slowdown resulted in cheaper financing.
one [borrower] locked a 2.75% interest rate on a Federal Housing Administration-insured 30-year mortgage. The borrower’s down payment was just 3.5%. … Other firms were also booking loans below 3%….
[One lender] is advising … customers to wait …, telling them that 30-year mortgage rates could drop to 2.5%.
https://www.bloomberg.com/news/articles/2020-03-04/mortgage-brokers-hire-like-mad-to-handle-demand-as-rates-plunge
I believe the gravy train has returned.
Sabrina believes “Refis are up but they’re not surging. They’re not even close to, say, 2013 levels.
Who ya gonna believe?
“I believe the gravy train has returned.”
When I posted my comment, they weren’t at 2013 levels yet.
And now? Probably.
But rates are going to go much lower. I don’t know why anyone would refi here. You’ll just have to do it again. And refinancing isn’t “free.”
The banks won’t have enough people to handle all the work because literally every American with a mortgage will want to refi once they go under 3% for a 30-year. It’s going to be insane for the mortgage brokers.
Good luck Russ! Will be fun times.
“Monday was the busiest day for mortgage applications in the company’s 35-year history….”
Duh. The 10-year has been in a free fall over the last week.
The Fed will cut again on March 18. Mortgage rates are going much lower.
But people should watch out what they ask for. Because the bond market is sending a nasty signal.
How low will mortgage rates go?
I saw a lot of people at open houses in the far out suburbs over the weekend. The good weather helped. And more inventory is coming on the market.
Will the low rates provide a big boost, or will the coronavirus grind things to a halt?
“How low will mortgage rates go?”
right now mortgage originators are so busy that banks aren’t even lowering rates — to keep volume down
my best guess is that within the year they get as low as 2.5% on a 30 year fixed
and what did I tell you for the last like 5 years sabrina? rates are going DOWN!
A great time to refinance if you haven’t done so already.
Just published my monthly update. After adjusting for leap year February was flat to last year. But contract activity was strong and inventory is down again.
Might help if I put in the link: http://www.chicagonow.com/getting-real/2020/03/chicago-real-estate-market-update-february-was-better-than-it-looks/
“and what did I tell you for the last like 5 years sabrina? rates are going DOWN!”
Yep. Bond market is signaling recession. Rates should stay low for a while.
I wasn’t sure which post this belongs to, but thought many would be interested in the fact that the Board of Review has SLASHED assessments for commercial properties that skyrocketed under Kaegi in the northern suburbs. So, all those landlords who were worried that the property tax burden was going to shift majorly to commercial properties in Chicago, can feel relieved that they have friends at the BOR. Of course, homeowners who were hoping their property taxes would be going down (like myself) and the burden was going to shift majorly to commercial properties might be disappointed.
The average commercial assessment went down by 32% (!). For residential properties, it went down slightly too, but barely.
Kaegi had raised commercials assessments by 98%, which was freaking landlords and commercial property owners out. The Board of Review has changed that to 35%, still a raise. Residential properties meanwhile, went up 13% from Kaegi, which was adjusted downward to +9% by the BOR. So, I will admit that at least SOME of the burden is shifting more to commercial properties with these discrepanices (i.e. commercial still increased more), but it’s not the titanic shift some were expecting after the Cook County Assessor was done with his work.
Large investors have been shying away from Chicago because of this uncertainty – they probably will be happy with seeing what happened with the BOR in the northern suburbs.
In Evanston, for example, total assessed value of commercial properties went from ~$600M after the assessor’s appeal process was complete to ~$400M after the BOR. Thats very very significant. (33% reduction).
Residential went from $905M to $876M (3% reduction).
1620 Central was purchased for $20.5M in 2018, assessed by the Assessor’s Office at $15.0M (still much lower than the purchase price), and then reduced to $11.8M by the BOR. So, yes, the BOR sees the value being about half of what somebody paid for it even though the assessment is supposed to reflect 2016-2019 sales/values.
Some good charts and quotes in the below article:
https://www.chicagobusiness.com/commercial-real-estate/big-tax-hikes-landlords-maybe-not
Quote:
“Thousands and thousands of citizens are going to be paying considerably more than they should because of the Board of Review,” says retired Cook County Clerk David Orr. […]
Kaegi, who unseated Berrios, has refused donations from the tax-appeals bar and hiked assessments on commercial and industrial properties, part of his push to fix what he believes is a broken and unfair assessment process. He contends his valuation methods are superior to his predecessor’s.
But Kaegi’s influence ends at the Board of Review, which is led by three elected commissioners, all of whom accept donations from property tax appeals attorneys. Until the Board of Review is reformed, the assessment system will still be stacked against homeowners, Orr says.
“I see the Board of Review as a longtime pay-to-play culture,” he says.
The recent assessment data “raise very serious questions,” Orr says. “I’m not sure that the Board of Review is very different from Berrios.”
Board Commissioner Michael Cabonargi, who is campaigning for clerk of Cook County Circuit Court, disputes that characterization.”
““I see the Board of Review as a longtime pay-to-play culture,” ”
Yeah, shocking.
So, here’s the thing: tell everyone you know who will vote in the primary next week to vote for *anyone* other than Cabonargi for Court Clerk, and *anyone* other than Rashid for the Board of Review.
I’m basically taking the party slate with me to know who NOT to vote for.
“Board Commissioner Michael Cabonargi, who is campaigning for clerk of Cook County Circuit Court, disputes that characterization.””
But, but, but, Carbonargi’s commercials say he is a progressive vegetable! A freaking vegetable, how progressive is that!
“Carbonargi”
A vote for Carbonargi is a vote for a political system loved by Mike Madigan *and* Donald Trump. Pay to play, and if you ain’t somebody somebody sent, get outta here.
*EVERYONE* who isn’t somebody’s somebody should hate these guys.
I begrudgingly pulled a D primary ballot in early voting. I only made one vote on the entire ballot – it was the NOT KIM FOXX vote. The rest, for all practical purposes, are just entirely interchangeable. It’s not often I pull a D ballot (may have been a decade ago or more) but it’s amazing to see how much the Democrat party tells you who your elected official will be. At least in my district, my state offices had o primary opponents most of the time, and I know that there are no republican running against them in the general. Sort of like living in Russia, where Putin is your leader, and his handpicked associates will be your ‘elected official’. It’s crazy how much the Democrat party operates just like the Russian politboro. Democrats = Russia.
“there are no republican running against them in the general”
The Illinois Republican party is presently a farce. They moan and groan about Gook County, but don’t bother to find anyone to run–it doesn’t matter if they’re sure losers, you have to be in the game to influence the outcome. Because anyone with a chance would fail some test imposed by the sorts of bozos who propose kicking Chicago out of the state.
If you didn’t vote against Carbonargi, too, HD, you’re part of the problem. I mean Fioretti is basically a Cook County R, you could have asked him for $20 to be one of the 872 people to punch his name.
“The Illinois Republican party is presently a farce.”
You are absolutely correct. The issues are many but I believe the two major and insurmountable issues are money and gerrymandering. JB spent something like $175,000,000 to buy his office. Rauner ‘only’ gave the IL GOP something like $40,000,000, and the IL GOP according to FEC disclosures is basically broke right now. They send me emails asking for $25 a month. It is, for all practical purposes, impossible in this state for a millionaire to compete with a billionaire. Gerrymandering is the second issue. Over half of all elections during the Blue Wave in 2018 had no opponent; and this year its about half of all state offices have no opponent. Think about how crazy that is. The Democrat politboro says “here is your elected official – vote for the only name on the ballot.” Between money and gerrymandering, there is no game to get into. Don’t worry, i’m counting the number days until I list my house and leave the state for greener pastures.
“Because anyone with a chance would fail some test imposed by the sorts of bozos who propose kicking Chicago out of the state.”
That’s an awfully arrogant view. The 1/3rd of the population that lives outside of Chicago is hollowing out and in rapid decline. They live hundreds of miles away from anything that happens in Chicago. They have more in common culturally and politically with Indy, St. Louis, Paducah, etc. Chicago should be it’s own city state. They’ve effectively taken over the state to the exclusion of everyone else who doesn’t live in the Chicago or close suburbs. The frustration is very, very real.
” At least in my district, my state offices had o primary opponents most of the time, and I know that there are no republican running against them in the general. Sort of like living in Russia, where Putin is your leader, and his handpicked associates will be your ‘elected official’. It’s crazy how much the Democrat party operates just like the Russian politboro. Democrats = Russia.”
————————-
Lemme get this straight: The Repukes decide to NOT run somebody and that’s the fault of the Dems?
Use your head for something besides a hat rack, HD.
“Lemme get this straight: The Repukes decide to NOT run somebody and that’s the fault of the Dems?
Use your head for something besides a hat rack, HD.”
Here ya go:
https://chicago.suntimes.com/2020/2/15/21139136/illinois-general-assembly-gerrymandering-public-corruption-mike-madigan-bill-brady-j-b-pritzker
“….Gerrymandered districts are designed to shut out the opposing party. In 2012, the Illinois map allowed the Democrats — who drew the map — to win 40 seats out of 59 in the state Senate and 71 seats out of 118 in the state House. They were able to do this though they secured only 52 percent of the vote total in House districts and 54 percent in Senate districts.
Let me put it this way. If the maps were drawn to reflect the true will of voters, created in a non-partisan manner, Illinois Democrats would have won only 62 House seats instead of 71 (52% of all members) and 32 Senate seats instead of 40 (54% of all members).
These skewed results occur because powerful software and detailed, block-by-block voter data enable redistricting plans that give one party huge partisan advantages that survive shifts in voter preferences and demographics. In the 2012 Illinois general election, all but 16 state House and Senate district races were won by more than 55 percent of the vote.
Partisan gerrymandering is not about policymaking but rather the tool used by one party to preserve power at the expense of another… “
https://herald-review.com/opinion/editorial/our-view-illinois-gerrymandering-an-abuse-of-power/article_d86dc4ab-7e4b-521e-91bd-09de4a04f402.html
“…For Illinois Democrats, and especially longtime House Speaker Michael Madigan, D-Chicago, the [gerrymandered] structure helps retain incredible power and majority control in the Legislature. Because fewer Republican residents translate into fewer Republicans running for office, some districts are almost untouchable — making for nearly guaranteed wins and essentially pointless general election contests. The infection is allowed to fester year after year, cycle after cycle….”
https://www.politico.com/story/2011/06/ill-makes-redistricting-hall-of-fame-056225
Ill. makes redistricting hall of fame
By RICHARD E. COHEN
06/03/2011
“Illinois House Speaker Mike Madigan this week punched his ticket to the partisan hall of fame.
With a muscular and mostly invisible back-room display that forged a Democratic redistricting plan that likely will gain his party a handful of House seats and end the careers of several GOP incumbents, the longtime speaker entered the pantheon of state power brokers whose efforts rippled well beyond their state capital and helped reshape Congress, for better or for worse.
Madigan’s masterstroke, and its expected effect, ranks him with other storied pols whose mapmaking exploits have become the stuff of political legend. And it places Illinois in the company of the following states that also produced memorably partisan maps. “
Voting in the Dem primary next week for Bill Conway as cook county’s states attorney and against Michael carbonargi for board of review.
https://www.galesburg.com/opinion/20200212/guest-editorial-time-to-end-tyranny-of-how-illinois-draws-political-maps
Guest Editorial: Time to end tyranny of how Illinois draws political maps
“…Maps are drawn so that the party in power can have as many like-minded folks within the boundaries as possible, which creates easy wins for incumbents. That’s why they are successfully reelected 97% of the time. You didn’t think it was because they were doing such a good job, did you?
Smart people realize that districts are so badly gerrymandered that it’s nearly impossible for a Republican to get elected in some districts or a Democrat in others. Good candidates are forced to the sidelines, which is why there are so many uncontested races year after year.
In Illinois, Democrats have controlled the process. In other states, Republicans are just as guilty. The 2011 map helped Illinois Democrats achieve veto-proof, three-fifths majorities in both the House and Senate in the 2012 elections.
Illinois has 118 state House districts and 59 Senate districts, and some of the boundaries of those districts are so warped that it appears the maps were drawn by someone who got a head start on the recreational use of marijuana…”
“against Michael carbonargi for board of review”
He’s actually running to replace the most corrupt countywide official, Dorothy Brown, as Clerk of Courts. Unfortunately, he’s likely to win because the other candidates are a black guy, a latin woman, and the white guy who lost to Dot Brown last time.
The guy slated by the D Committemen for the Board of Review seat is presumptively tainted, as he has to be assumed to continue the status quo. So anyone but Rashid.
Dorothy Brown
OMG! I read the wiki
https://en.wikipedia.org/wiki/Dorothy_A._Brown#Scandals
““….Gerrymandered districts are designed to shut out the opposing party.”
————————
Nobody said you were going to win, but the Repuke decision to not run a candidate is their decision, not some coercion worthy of a Russian czar.
HD2020!
“JB spent something like $175,000,000 to buy his office. Rauner ‘only’ gave the IL GOP something like $40,000,000, and the IL GOP according to FEC disclosures is basically broke right now.”
You’re kidding about the Rauner/Pritzker race, right HD?
Rauner has been making, literally, $50 million+ a year in INCOME for the past several years. How do you know he’s not also a billionaire?
Here’s what they both spent according to NBC:
“Democrat Pritzker has spent $171 million of his wealth to try and become governor. Rauner, following his first election, has spent close to $70 million of his own money.”
https://www.nbcchicago.com/news/politics/bruce-rauner-jb-pritzker-spending-campaigns-for-illinois-governor/169437/
And to WHINE that Rauner couldn’t outspend Pritzker when, in 2014, rich Rauner spent $36 million of his own money in that race against Quinn (who is NOT rich) is classic.
How did Quinn have ANY chance against Rauner in 2014 if money is all that matters?
Johnc said:
“Nobody said you were going to win, but the [R] decision to not run a candidate is their decision, not some coercion worthy of a Russian czar.”
Yes, you’re right. Putin too says the same thing. Putin DEMANDS that a meaningless underfunded candidate with no chance be nominated by the opposition party. PUTIN then CRUSHES THEM in the election, to show world how strong PUTIN is and how WEAK the opposition party is.
True, just like PUTIN, the Democrats gerrymandered the district boundaries *to the block* using super-computer to dilute remnants any opposition party influence and CRUSH their will to participate in the democrat election process. Then PUTIN blames the victim for their own weakness.
Democrats = Putin’s politboro.
“Putin DEMANDS that a meaningless underfunded candidate with no chance be nominated by the opposition party.”
——————————–
I absolutely defy you to show where, at any time, the Dems “demanded” that the Repukes put forward any candidate at all, let alone a meaningless, underfunded one.
Sing and dance all you want, but if a party doesn’t put a candidate forward, that’s on that party, not the other party.
Use your head for something besides a hat rack.
Yes, PUTIN doesn’t need to demand that a meaningless, underfunded opposition candidate in a heavily gerrymandered district. the opposition knows better than to challenge PUTIN. Russia politboro = Illinois Democrat Party.
I mean, in most districts, the Democrats don’t even primary their own corrupt appointed, ahem, elected officials. I read the other day in some Trib article that State Senator Martin Sandoval, who was recently charged with federal corruption crimes, never had an opponent against him – EVER going back as far as 2002. his district was drawn for him in the 2002 redistricting and he was the only candidate. Imagine that, 18 years in a power state office, and NEVER having an opponent, either in the democrat primary OR the general. No opponent ever. PUTIN would be so proud Johnc. Is it any surprise that the ‘elected’ official turned out to be just a corrupt as PUTIN?
“I mean, in most districts, the Democrats don’t even primary their own corrupt appointed, ahem, elected officials.”
——————————–
You can’t force people to run, HD. Simple as that. Now knock off the hystrionics and use your head for something besides a hat rack.
“Will the low rates provide a big boost, or will the coronavirus grind things to a halt?”
I’m going to go out on a limb here and say that it will be the latter.