Chicago Market Conditions: Median Home Price Spikes in March to Highest Since 1997
The Illinois Association of Realtors is out with the March data.
The Chicago market started out the spring home buying season on a strong note, with near record low mortgage rates and record low unemployment.
But, in March, the COVID-19 state and city wide economic shutdown hit.
Still, March was another strong month despite the virus.
The city of Chicago saw year-over-year home sales increase 1.0 percent with 2,082 sales in March, compared to 2,062 a year ago. The median price of a home in the city of Chicago in March was $320,000 up 10.1 percent compared to March 2019 when it was $290,700.
Historic data courtesy of G:
City of Chicago condo/TH/SFH closed totals March
year/closed/median/% REO-Short Sales
Year Closed Median %REO/SS
1997 1,226 $126,875
1998 1,540 $137,003
1999 1,766 $152,125
2000 1,793 $167,500
2001 1,800 $195,000
2002 2,112 $210,000
2003 2,261 $225,000
2004 2,772 $244,950
2005 2,822 $271,125
2006 3,000 $275,862
2007 2,399 $285,000
2008 2,098 $300,000
2009 1,219 $217,000 37%
2010 1,860 $207,750 38%
2011 1,481 $163,763 49%
2012 1,630 $170,500 44%
2013 1,894 $187,500
2014 1,875 $235,000
2015 2,173 $260,000
2016 2,149 $269,000
2017 2,546 $295,000
2018 2343 $310,500
2019 2062 $290,700
2020 2082 $320,000
“Though we likely won’t see a fuller picture of coronavirus’ impact on the housing market until April’s numbers are released, we are happy to see positive momentum in March,” said Maurice Hampton, president of the Chicago Association of REALTORS® and owner of Centered International Realty. “Clearly, demand kept pace, despite the pandemic, with an uptick in closed sales and sales price over last year. However, we also saw a sharp decline in inventory, something we will continue to keep our eyes on for the future, as homeowners react to the uncertainty of the current environment.”
The 30-year fixed mortgage rate averaged 3.45% down from 3.47% in February and down from 4.27% in March of 2019.
Average time on the market statewide remained unchanged year-over-year at 63 days.
In Chicago, average market time fell to 47 days from 49 days a year ago.
“The March data on the housing market are probably the last to reflect the pre-pandemic impact of the economy,” said Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory at the University of Illinois. “Unlike the recession that started in 2008 when there was a gradual increase in unemployment for the next several years, the events of the first quarter of 2020 have revealed a precipitous decline in employment levels (and a concomitant increase in unemployment rates). The consumer sentiment indices reported this month, most notably the decline in the Fannie Mae Home Purchase Sentiment Index, suggest that over the coming months, we can expect to see a growing negative impact on housing prices and sales.”
Chicago inventory fell 13.6% to 7697 from 8909 in March 2019.
Inventory is so limited in some neighborhoods, I’m hearing of bidding wars breaking out.
If you were going to list this spring, are you crazy to wait until the shutdown ends?
Or should you be listing right now when competition is limited?
Illinois home sales and prices post gains in March [Illinois Association of Realtors, Press Release, April 21, 2020]
“Inventory is so limited in some neighborhoods, I’m hearing of bidding wars breaking out.”
People keep focusing on the absolute level of inventory but you need to look at how many homes per buyer are out there. We can’t do that so we look at months of supply. Even that can be off because often that’s based on a yearly average sales rate. So, recently, I’ve been looking at weeks of supply based on weekly contracts written. On that basis inventory is sky high relative to last year: http://www.chicagonow.com/getting-real/2020/04/the-good-and-bad-effects-of-coronavirus-on-chicago-real-estate-week-6/ There are many more nuances – e.g. new inventory vs. old inventory. Lots of old inventory less new inventory.
Thanks Gary for the valuable insight vice JZ level shilling
It will be interesting to see the how many places actually close where the buyer hasn’t seen the property and there’s a contingency clause. If the current state persists, I can see where buyers use this to back out of deals due to worsening economic conditions
Are lenders following JPM’s lead on loan requirements?
Yeah, that’s my fear about these showing contingent deals. Also, buyer has an image of the property based on the photos and reality may be totally different. Then they want to cut their offer or walk away. Meanwhile, the property has been off the market. We see this frequently with inspections too.
Russ would know better than me about loan requirements.
“Yeah, that’s my fear about these showing contingent deals. Also, buyer has an image of the property based on the photos and reality may be totally different. Then they want to cut their offer or walk away. Meanwhile, the property has been off the market. We see this frequently with inspections too.”
Whats the typical lag with these contingent offers? There definitely is a case where buyers can be bid shopping properties or if the market drops ask to renegotiate the price
It’s all negotiable. If I had to do a deal like this I would want the buyer to see the property within a week – max two weeks.
I take that back. When I answered that I was thinking an out of town buyer, which is where we usually encounter this. For an in-town buyer it should be much shorter – just a few days.
Things are about to get ugly, really, really ugly. The city’s and state’s budget shortfall is looking increasingly dire. Relying on Durbin to ‘bring home the bacon’ is little more than wishful thinking after the our national ridicule last week after naively asking well run red states for $40B. Whoooops! that was embarrassing. This shortfall is coming out of your and mine and our neighbor’s pockets. The city and state and county have made it clear that no cuts can be made because its all essential and run as efficiently as possible. The lost revenue from the amusement taxes, vice taxes, sales taxes, transfer taxes – it’s all coming out of your pocket, one way or another. And given that Chicago and IL are particularly broke, I can’t possibly think of a worse time to buy in Chicago given the historic uncertainty.
” buyer has an image of the property based on the photos and reality may be totally different”
And, often, a made up BS square footage.
Talk about a gimme of an out. Seems like a potential liability for a realtor who makes up a number, if the Buyer terminates with any allusion to “it seems smaller”.
naively asking well run red states for $40B.
https://wallethub.com/edu/states-most-least-dependent-on-the-federal-government/2700/
Illinois is bailing out the “well run red states” on a daily basis.
https://www.governing.com/week-in-finance/gov-taxpayers-10-states-give-more-feds-than-get-back.html
“Median Home Price Spikes in March to Highest Since 1997”
Think it is safe to say “highest ever”, or “highest on record”.
It’s not as if there has been a long deflationary period or major revaluation of USD sometime between 1833 and 1996.
“Illinois is bailing out the “well run red states” on a daily basis”
And has been for the last 40 years. This is because our inept elected officials suck so bad at their jobs they cant even get our fair share from congress. Look at the turds we send to DC, they are more interested in copying coastal liberals than doing their job. Its sad and pathetic. Ive defended this state and city for over 30 years, you prob wouldn’t find a bigger booster, but Ive reached my end. Whole family has actually.
(blue states fund red states)
“The analysis — which considered not only direct federal funding for programs but also money for grants, contracts and income earned by federal workers in each state — is the second study of this kind published by the institute.”
I’ve seen these types of articles before but they’re misleading, at best. red states aren’t ‘getting’ more than blue states, the money is just being spent where it needs to be spent. There happens to be higher levels of poverty in some of those red states. Are you saying that the federal government shouldn’t give medicaid dollars to poor people in red states, only blue states? Because that’s what you imply.
Additionally, a lot of federal facilities are in red states – think national parks, national forests, military bases, and so on. So should the federal government not fund the military because some bases are in red states?
Other studies go even farther and include social security payments as ‘blue states funding red states’ which is ridiculous. More seniors live in red states that’s why the money is being sent there.
So go ahead, believe this stuff if you want, but until Illinois can get large national parks, more military bases, more poor people or more seniors retiring, or more federal government facilities, we will continue to send more money out than coming back in.
Frankly, this whole system whereby the federal government sucks in money from across the nation, mixes it up in a giant blender, and then spits it back out based on political power disgusts me. The blue states vote for policies that have them sending money to red states. It’s crazy town.
Maybe those shit schools in Tx are doing a good job at teaching students how to take advantage of dim witted Blue staters?
“I’ve seen these types of articles before but they’re misleading, at best. red states aren’t ‘getting’ more than blue states, the money is just being spent where it needs to be spent. There happens to be higher levels of poverty in some of those red states. Are you saying that the federal government shouldn’t give medicaid dollars to poor people in red states, only blue states? Because that’s what you imply.”
—————————————–
Idiotic statement — The money is being spent where it needs to be spent. W-H-Y does it need to be spent there? If the red states had proper education systems and proper welfare systems, the federal government wouldn’t be spending money there, now would it? Compare red state “poverty” levels with blue state “poverty” levels and ask yourself why the levels are what they are.
If Illinois cut out welfare programs and slashed education, we’d qualify for more federal dollars. Are you saying that responsible people make others (the feds) pay their bills?
“Idiotic statement — The money is being spent where it needs to be spent. W-H-Y does it need to be spent there? If the red states had proper education systems and proper welfare systems, the federal government wouldn’t be spending money there, now would it? Compare red state “poverty” levels with blue state “poverty” levels and ask yourself why the levels are what they are.
If Illinois cut out welfare programs and slashed education, we’d qualify for more federal dollars. Are you saying that responsible people make others (the feds) pay their bills?”
Speaking of idiotic statements…
Porky Pig needs to waddle his ass up to Washington to get some of that sweet, sweet Uncle Sugar monies.
Personally I’d start by turning LS into a Spent uranium storage facility or maybe the site for a new Minuteman Missile silo base.
Then I’d say fuck Texas, lets get Chicago back to its roots. Hog Butcher to the world.
MIGA!
There happens to be higher levels of poverty in some of those red states. Are you saying that the federal government shouldn’t give medicaid dollars to poor people in red states, only blue states? Because that’s what you imply.
Absolutely not. Fed money should go where the need is. But if the red states are so well run, why do they have such high poverty levels?
Right now, IL is in need of federal money, and the sniping from red staters is a bit rich.
Oh, and miss me with that national parks bullshit. California, Colorado, Washington, and Utah are in the top 5 states for national park coverage, and in the bottom third of receiving money from the federal government.
“Oh, and miss me with that national parks bullshit. California, Colorado, Washington, and Utah are in the top 5 states for national park coverage, and in the bottom third of receiving money from the federal government.“
Before calling BS on someone
Federal acreage
1) AK
2) NV
3) CA
4) UT
5) ID
NPS
1) AK
2) CA
3) AZ
4) FL
5) WY
“The money is being spent where it needs to be spent. W-H-Y does it need to be spent there? If the red states had proper education systems and proper welfare systems, the federal government wouldn’t be spending money there, now would it?”
You do realize, you know, that it is the blue voters in red states that receive the disproportionate amount of federal aid redistributed from blue states? Before you go all crazy. Your like minded voters are getting the help they need.
And you also realize that the ‘red’ states aren’t as red as you want to make them out to be…
the #1 dependent state: New Mexico = blue state.
#3: WV – Democrat senator
#4 Montana – democrat senator and governor
#5 Kentucky – democrat governor
#7 Arizona – Democrat senator
#9 Alamaba – Democrat senator
#12 Louisana – Democrat senator and governor
and so on, and so on. So just straight saying “red states’ when only in presidential elections do they go red, but vote blue often enough in statewide elections, is also misleading.
But facts matter. The ‘narrative’ and fake news you believe does not.
“Frankly, this whole system whereby the federal government sucks in money from across the nation, mixes it up in a giant blender, and then spits it back out based on political power disgusts me. The blue states vote for policies that have them sending money to red states. It’s crazy town.”
It’s even worse than that Gary, a substantial portion of that money sucked into the capital city stay in the capital city, never to leave again. Six of the ten wealthiest and richest counties in the US are DC suburbs.
Loudoun County, Va., $129,588
Fairfax County, Va., $117,515
Howard County, Md., $115,576
Falls Church City, Va., $114,795
Arlington County, Va., $112,138
Douglas County, Co., $111,154
Hunterdon County, N.J., $110,969
Los Alamos County, N.M. $110,190
Morris County, N.J., $107,034
Fairfax City, Va., $106,870
They take the money from US, keep a large chunk of it, and spend it as they see fit. This was exactly the opposite of what founding persons wanted.
Before calling BS on someone
top 5 states for national park coverage means percentage of land that is national park, not total acreage of national park. What you quoted was total acreage.
You do realize, you know, that it is the blue voters in red states that receive the disproportionate amount of federal aid redistributed from blue states? Before you go all crazy. Your like minded voters are getting the help they need.
But no one is saying not to send money where it’s needed. We’re simply asking why it’s somehow “begging” when IL needs fed money, ie. naively asking well run red states for $40B.
Also, what are you basing this on:
that it is the blue voters in red states that receive the disproportionate amount of federal aid redistributed from blue states
Anybody else think current home prices in Chicago will drop by at least 20% before the end of this year?
” Your like minded voters are getting the help they need.”
—————————-
Nice try son, but you talked about states, not individuals. Given that most people on medicaid nationally are rural whites, I challenge your statement about “like-minded.” In any event, state-wide analysis is what you went with, so stop whining, singing, and dancing.
BTW — think before you reply. It’s a well known fact that city-dwellers are more productive than rural folk. So if you want to consider Texas without its cities, go ahead, but as others here have noted, that will put paid to your whining that red states are well run.
“Anybody else think current home prices in Chicago will drop by at least 20% before the end of this year?”
——————————–
Me.
“They take the money from US, keep a large chunk of it, and spend it as they see fit. This was exactly the opposite of what founding persons wanted.”
—————————–
Who is “they?” The counties you mentioned? Our founding fathers worried about states, not counties.
You’ll find elevated incomes in areas with military bases and other federal institutions, too, which is why states fight so hard to get them.
“top 5 states for national park coverage means percentage of land that is national park, not total acreage of national park.”
If you go by all NPS land (which is not the same as “National Parks” land, but doesn’t include Forest Service, BLM or Wildlife Refuge land), the top states in order are:
1-AK
2-FL
3-HI
4-CA
5-WA
6-WY
7-UT
8-AZ
9-MI
10-MT
“top 5 states for national park coverage means percentage of land that is national park, not total acreage of national park.”
If you go by all NPS land (which is not the same as “National Parks” land, but doesn’t include Forest Service, BLM or Wildlife Refuge land), the top states in order are:
1-AK
2-FL
3-HI
4-CA
5-WA
6-WY
7-UT
8-AZ
9-MI
10-MT
So what you meat to say is %. Congrats you are still incorrect
Does Hawaii’s NPS numbers include their underwater nat’l Park?
“Does Hawaii’s NPS numbers include their underwater nat’l Park?”
—————————
Now you dunit. Had to run your suck, didn’t you? Sabrina will now insist that we should, since eventually the land will rise and the land values will rise.
“BTW — think before you reply. It’s a well known fact that city-dwellers are more productive than rural folk. So if you want to consider Texas without its cities, go ahead, but as others here have noted, that will put paid to your whining that red states are well run.”
I know you’re just trolling me with this racist nonsense. If you really believe this, then your TDS is terminal. Either way, my mother told me never to argue with someone with Trump Derangement Syndrome, because to a passerby, it looks like you both have TDS.
“Either way, my mother told me never to argue with someone with Trump Derangement Syndrome, because to a passerby, it looks like you both have TDS.”
This is always the problem with Trump supporters. They never want to discuss the actual facts so they just blame it on TDS.
It’s so intellectually weak.
“Anybody else think current home prices in Chicago will drop by at least 20% before the end of this year?”
Some of you must be really, really young and don’t remember what happened in 2007-2012.
You need INVENTORY to have a price drop. Supply and demand.
Just in the past week, I personally know of a property in the GreenZone that had 8 showings and 6 offers within 24 hours of being listed.
It was a bidding war.
You think that’s selling for 20% less?
Lol.
Real estate is sticky. It takes years to see price declines. And, of course, you’re going to need inventory. Where you going to get that?
Average foreclosure is like 3 to 5 years in Illinois.
Dream on.
“You do realize, you know, that it is the blue voters in red states that receive the disproportionate amount of federal aid redistributed from blue states?”
I had NO idea that all those rural Kentucky citizens on SSDI were voting blue.
Mitch is doomed this fall.
“Ive defended this state and city for over 30 years, you prob wouldn’t find a bigger booster, but Ive reached my end. Whole family has actually.”
Okay marko. Then leave. Nothing keeping you here. The country is big.
Change is good.
Go to Texas and sit in your car with 10,000 others in San Antonio waiting for food.
“This shortfall is coming out of your and mine and our neighbor’s pockets.”
All of the states and big cities will get bailed out. No one’s budget can handle it.
Think of the loss of revenue for Chicago simply because the Cubs and White Sox won’t be playing this year?
No way to make up for that. You need a huge infusion from the Feds.
Everyone is going to get theirs, even if McConnell says it’s not going to happen.
Kentucky is, along with Illinois, in one of the worst situations.
Real estate is sticky. It takes years to see price declines. And, of course, you’re going to need inventory. Where you going to get that?
Current AirBnb units and all the new projects nobody is going to buy for inflated prices, for starters.
Housing prices are going to tank across the country, Chicago included. How much they will drop shall be seen soon!
Im wide awake here, not dreaming.
“Current AirBnb units and all the new projects nobody is going to buy for inflated prices, for starters.”
Where? In Jefferson Park?
High rises and most condo buildings have banned Airbnb.
Also, please read the old posts on this site if you want to know how long it takes to go into foreclosure in Illinois. We literally have chattered about properties where the owner stopped paying the mortgage and the bank didn’t ever take it back for 5 years. And then it took them two or three years to re-list so you’re looking at 8 years later.
So unless the economy still sucks 8 years from now, housing prices aren’t going to go down.
“Anybody else think current home prices in Chicago will drop by at least 20% before the end of this year?”
Nyet,
Case-Shiller’s HPI for Chicago, released March 31, 2020, was 142.36.
Are you & johnc predicting that by Dec. 31, it will be less than 114?
Or are you referring to some other house price index that will fall by 20%?
Or are you just bantering?
http://press.spglobal.com/2020-03-31-S-P-CoreLogic-Case-Shiller-Index-Shows-Continued-Growth-in-Annual-Home-Price-Gains-to-Start-2020
wojo,
If you are that bearish on Chicago home prices you should look into selling Chicago Case Shiller futures. But I have to admit you might not get a very good price
I just checked: the market in CS real estate futures is essentially nonexistent. A big volume day is 4 contracts:
https://www.cmegroup.com/trading/real-estate/residential/SandP-case-shiller-price-index_quotes_volume_voi.html
That’s not the outcome Shiller had envisioned. But the commodity’s natural ‘longs’ don’t see a need to hedge their inventory, unlike producers in the agricultural & financial industries.
Zillow, banks, GSEs, FHA, Invitation Homes, builders, etc. all have huge long exposure, but none of them hedge it. Instead they lobby for policies (like ZIRP) to offload it onto everyone.
I think a 20% decline in Chicago’s CS-HPI is unlikely, but not impossible, so I’d take unders.
The overs will cite chatter like this FT report on London’s re market:
“Estate agents, not known for their pessimism, have estimated that average house prices will fall by anything between 3 and 10 per cent this year, according to different pieces of research.
“Their clients [the buyers] expect prices to be lower when the market reappears — and they want vendors to acknowledge this in prices today. This could be anything from a gesture of 2-3 per cent to a punchier 10-15 per cent….
“There is nothing to stop buyers asking for more aggressive discounts of 20 per cent or more — as a number of readers suggested in our Q&A….”
https://www.ft.com/content/b0bb1cc4-8ed4-474c-9e4d-cbfe0c94d192
“That’s not the outcome Shiller had envisioned. But the commodity’s natural ‘longs’ don’t see a need to hedge their inventory, unlike producers in the agricultural & financial industries.
Zillow, banks, GSEs, FHA, Invitation Homes, builders, etc. all have huge long exposure, but none of them hedge it. Instead they lobby for policies (like ZIRP) to offload it onto everyone.”
Precisely! It amazes me that this hasn’t caught on. However, there is a market maker so you would be trading with him. If you had a strong feeling you could put an offer out there and see if he would take it.
“Are you & johnc predicting that by Dec. 31, it will be less than 114? ”
—————————–
I am, especially in real terms, not nominal terms, as I don’t think inflation will spike that fast and work its way into property prices.
Shakeout will first come in multi-family properties, when people realize that tenants living paycheck to paycheck will not be able to make up arrears when everything settles out, and property tax increases (to cover interest on debt, if nothing else) crush values, a la Chicago’s South suburbs.
“I am, especially in real terms, not nominal terms”
But it’s a purely nominal index, so … that would sound like a dodge if Gary had actually offered a wager.
In real dollar terms, using CPI as the deflater, Chicago C-S is at mid-1997 levels (which was, also using CPI, basically flat with *1989*). 114 (with zero inflation) would be WELL below *1987* + CPI.
The national index is fully 50% ahead of inflation since Jan-87, and +36% from Jan-89+CPI.
Chicago real estate, as measured by C-S, has been among the worst investments in the country over the past 30 years.
““Anybody else think current home prices in Chicago will drop by at least 20% before the end of this year?””
I’m a total bear and even I won’t take that bet. 36 months from now? Sure. 7 months? Dude, JB has basically suspended evictions and foreclosures indefinitely until either a court overrules his tyranny or he reopens the state. And if it’s up to him, not until after November 2020. The last recession took 4-5 years to reach the bottom. We’re not even two months into JB’s shutdown debacle. This is going to be a slow, very slow motion trainwreck.
“Chicago real estate, as measured by C-S, has been among the worst investments in the country over the past 30 years.”
Drive around Chicago and the suburbs and it’s not hard to understand why. There hasn’t been a lot of growth. People aren’t moving here in great numbers. And those who do are transient.
“There hasn’t been a lot of growth. People aren’t moving here in great numbers. And those who do are transient.”
For 30 years?
Come on. Enough with the BS.
“Dude, JB has basically suspended evictions and foreclosures indefinitely until either a court overrules his tyranny or he reopens the state.”
The CARES Act has a year long forbearance in it. That’s the Feds.
“Estate agents, not known for their pessimism, have estimated that average house prices will fall by anything between 3 and 10 per cent this year, according to different pieces of research.”
Why are you citing London, wojo, when their prices have been on the decline for the last 2 years going into the pandemic?
Prices started falling as soon as Brexit passed.
Here is my April update. It was pretty ugly out there and it will get uglier. http://www.chicagonow.com/getting-real/2020/05/chicago-real-estate-market-update-april-home-sales-plunge-21/
Trump derangement syndrome? Give me a break. Trump himself is deranged, as anyone with any ability to judge character can see. This country was deranged to let him come within 500 miles of the White House. Just hoping things change in November.
“Here is my April update. It was pretty ugly out there and it will get uglier.”
Thanks for the update Gary.
This is pretty much what I would expect. The big question is, will anyone be listing and buying once the reopen happens? Or will the housing market remain frozen for months?
We’ll have to wait until June, most likely, to find out.
“We haven’t yet met the criteria to reopen. I’m glad both JB and the mayor are staying the course. We have to bend the curve. It’s the only way. ”
It’s disingenuous to say it’s the only way. Your way condemns people to die deaths of despair as they lose their homes, livelihoods, businesses, families and health. This doesn’t seem like a reasonable trade off for a disease that 99.9% of non-obese people under 70 will survive after a little fever and a cough. Now we can have an honest discussion about some sort of middle ground between JB’s way or the highway.