Market Conditions: August Inventory Fell 7.1% YOY as Sales Fell to 13-Year Lows
The Illinois Association of Realtors is out with the August 2024 data.
The Chicago market remained extremely tight with inventory and sales falling again.
“The city of Chicago saw a 7.1 percent year-over-year home sales decrease in August 2024 with 2,083 sales, down from 2,242 in August 2023. The median price of a home in the city of Chicago in August 2024 was $355,000, an increase of 7.1 percent from August 2023 when the median price was $331,500.”
August sales since 2007:
- August 2007: 2923 sales
- August 2008: 2078 sales
- August 2009: 1927 sales
- August 2010: 1486 sales
- August 2011: 1787 sales
- August 2012: 2209 sales
- August 2013: 2850 sales
- August 2014: 2414 sales
- August 2015: 2701 sales
- August 2016: 2844 sales
- August 2017: 2791 sales
- August 2018: 2754 sales
- August 2019: 2601 sales
- August 2020: 2870 sales
- August 2021: 2919 sales
- August 2022: 2354 sales
- August 2023: 2242 sales
- August 2024: 2083 sales
August Median Sales Price
- August 2007: $305,000
- August 2008: $297,500
- August 2009: $229,900
- August 2010: $200,000
- August 2011: $192,500
- August 2012: $200,000
- August 2013: $245,000
- August 2014: $269,500
- August 2015: $271,000
- August 2016: $271,000
- August 2017: $284,000
- August 2018: $280,000
- August 2019: $289,900
- August 2020: $335,000
- August 2021: $335,000
- August 2022: $315,000
- August 2023: $331.500
- August 2024: $355,000
“In August, a decrease in closed sales were reflective of Chicago’s limited inventory as sellers consider the balance of a fast selling and competitive buying market,” Erika Villegas, president of the Chicago Association of REALTORS® and broker and owner of RE/MAX In the Village said. “Work with your local REALTOR® and a lender so you can take action when the opportunity arises.”
Inventory is finally moving HIGHER statewide. Statewide, inventory rose 8% to 21,932 homes from 20,315 homes in August 2023.
Chicagoland is also seeing higher inventory as it rose 6.8% to 14,975 from 14,023 properties.
Only Chicago is still seeing declining inventory, where it fell 8.5% to 5,048 from 5,515 last year.
For multi-year comparisons:
Statewide Inventory:
- 34,083 in August 2021
- 29,084 in August 2022
- 20,315 in August 2023 (down 30% year-over-year)
- 21,932 in August 2024 (up 8% yoy)
Chicago Inventory:
- 9,231 in August 2021
- 7,999 in August 2022
- 5,515 in August 2023 (down 30.9% year-over-year)
- 5,048 in August 2024 (down another 8.5% yoy)
The 30-year fixed rate mortgage in August 2024 was 6.5%, down from 6.84% in July 2024 and down sharply from last year when it averaged 7.07%.
Do the mortgage rates even matter for home sales anymore when inventory is this low?
Illinois home sales fall while inventory and median prices rise in August [Illinois Association of Realtors, Press Release, September 19, 2024]
“Do the mortgage rates even matter for home sales anymore when inventory is this low?”
Rates always matter.
“In August, a decrease in closed sales were reflective of Chicago’s limited inventory as sellers consider the balance of a fast selling and competitive buying market,”
I think sellers are more concerned with the financing costs, inflation and property taxes vs a “fast selling” market.
“Rates always matter.”
Rates aren’t impacting Chicago home sales at all. Neither positively, nor negatively. But lower rates could mean prices rise further as more people come out to buy and there are more bidding wars.
“Rates aren’t impacting Chicago home sales at all. Neither positively, nor negatively. But lower rates could mean prices rise further as more people come out to buy and there are more bidding wars.”
This is 100% false
“This is 100% false”
Nope. Data doesn’t lie. And we’ve had the data for over two years.
Sorry bears. Your doom and gloom has failed. First, Bob the Bear was on this site telling us all that once the foreclosure freeze was lifted, there would be thousands of foreclosures and housing prices would collapse.
Never happened.
Then, mortgage rates rose over 7% for nearly two years. Housing prices were supposed to collapse then too. JohnnyU and other bears kept insisting that no one would pay $550,000 for that 2/2 that was $450,000 with a 3% rate just a year before. But they DID. And they STILL are.
Chicago median prices continue to rise. It’s the mix, of course, but the prices on the high end are certainly holding up to get $355,000 median.
Tell us you don’t know how a median is calculated without saying “I don’t know how a median is calculated”:
“the prices on the high end are certainly holding up to get $355,000 median.”
“Then, mortgage rates rose over 7% for nearly two years. Housing prices were supposed to collapse then too. JohnnyU and other bears kept insisting that no one would pay $550,000 for that 2/2 that was $450,000 with a 3% rate just a year before. But they DID. And they STILL are.”
This has nothing to do with supply. Just typical Sabrina gaslighting
“Chicago median prices continue to rise. It’s the mix, of course, but the prices on the high end are certainly holding up to get $355,000 median.”
Google the difference between MEAN and MEDIAN
Embarassing
“This has nothing to do with supply. Just typical Sabrina gaslighting”
Never said it did. But your theory that people would NOT buy that 2/2 condo that has gone up in price with 7% mortgage rates was WRONG. You kept assuming that people would somehow be priced out. It turned out my theory that they would trade down to the lower price point and buy anyway, is what happened.
Also, buyers go off the reality in front of them. They get approved for a certain mortgage amount and look for properties that satisfy that. They don’t think, “oh, two years ago I could have bought XYZ which was bigger and nicer for the same amount.” They deal with the reality which is TODAY.
But don’t fret JohnnyU. I, too, didn’t get the real estate story right. I never thought Chicago would be one of the cities which would see rising prices with mortgage rates over 7%. But I never anticipated record low inventory that would stay that low for 2+ years. And, unless there is drastic home building in the next few years, is likely to stay that low for some time to come.
However, there is the possibility of more apartment to condo conversions which will add more inventory. We’ve already seen this part of the cycle starting. But it still doesn’t add that many new units in some neighborhoods like Lakeview or Lincoln Park. It could add a couple thousand units in Fulton Market though.
Fully admit that I thought that prices would drop. See it is possible to admit that you’re wrong and survive.
Though I dont think its a universal “buying down” as you’d see a lot more pressure in 2nd tier locations (SL & Further south). Small sample size but I’ve seen more “stretching” or parental help in purchasing
But back to the topic, we were talking about supply, not pricing. Lets see if you can stop with the gaslighting and admit that interest rates are suppressing supply
I am not hopeful
“Today’s much-anticipated jobs report ended up coming out much stronger than expected. … this is one of the largest single day jumps we’ve seen with the average 30yr fixed rate moving from 6.26 to 6.53. A move of more than 0.25% in a single day is tremendously uncommon….”
https://www.mortgagenewsdaily.com/markets/mortgage-rates-10042024
Yesterday’s CNBC interview with Redfin CEO, Glenn Kelman:
Question: What is it going to take in order to see more meaningful levels of inventory hit the market?
Kelman: I don’t expect to see much progress. We’re talking to many people who are rate-locked: they got a mortgage at three percent or three-and-a-half-percent a few years ago, and they still can’t afford to buy their own home. Two-point-five-percent of American homes changed hands in the past twelve months, which is a thirty year low. So on the inventory side, we are still going to be crimped and that is going to be the gating factor for home sales in 2025.”
https://youtu.be/_R6Wg4HYYkM?si=lugFwrDANnKSlfzo&t=70s
Doesn’t Kelman know that people just want to live their lives? WTAF?
He’s a software guy who’s disconnected from the world. Give me some quotes from high volume Realtors(tm) who really know what ‘the people’ want and need!
Or at least a self proclaimed Chicago real estate expert(tm)
Nice School District you got there, lol
Kelman: I don’t expect to see much progress. We’re talking to many people who are rate-locked: they got a mortgage at three percent or three-and-a-half-percent a few years ago, and they still can’t afford to buy their own home. Two-point-five-percent of American homes changed hands in the past twelve months, which is a thirty year low. So on the inventory side, we are still going to be crimped and that is going to be the gating factor for home sales in 2025.”
Sure. Lots of people aren’t going to give up their rate. But 40% of all homes have no mortgage. Those people don’t care. Many are Baby Boomers and GenX who want to live in other cities and states.
I think it has to go into the 5s before it becomes more attractive to those who already own.
“But 40% of all homes have no mortgage. Those people don’t care. Many are Baby Boomers and GenX who want to live in other cities and states.”
This is misleading as it includes all owners, not just individuals
“I think it has to go into the 5s before it becomes more attractive to those who already own.”
Yet you constantly argue with me that higher rates arent having an effect on homeowners with a 3% mortgage
Weird
“This is misleading as it includes all owners, not just individuals”
Less than 1% of single family homes are owned by corporations.
In Chicagoland, as of 2022, the number who owned their homes without a mortgage (includes condos and townhouses) rose to 36% from 33% in 2017. In Cook County, latest data I saw was several hundred thousand homes owned outright. That is massive financial firepower and just really gives those owners freedom to sell and move if they desire to.
Chicago homeowners had been underwater for nearly 20 years thanks to the bubble. Many got trapped here but it meant they ended up paying off the home. We have some of the highest levels in the country for paid off homes but the retirement cities are higher (for obvious reasons.)
The people with low rates may not want to move, but it’s not stopping thousands of others in Chicago.
“Yet you constantly argue with me that higher rates arent having an effect on homeowners with a 3% mortgage”
Too many variables. You may have a 3% rate but bought in 2012 and your home value has doubled. Your income has risen considerably as well. Might not care if the rates are at 5% as your financial firepower can still afford it. But depends on where you are moving TO. 5% may keep you in Chicago if you’re moving to LA or San Diego where home prices are much, much higher. If you’re moving to Grand Rapids, not so much. The rate probably doesn’t matter to you at all.
But now that the Fed is cutting, there certainly are some people waiting on the sidelines for the rates to go down further. Why wouldn’t you? Even a 6% rate would save over $500 a month on a typical $400,000 mortgage.
I’m expecting this spring to be red hot. Inventory should rise but it’s still going to be so low that there will be multiple offers on many properties.
For comparison, there were just 5,000 homes on the market at the end of last month. Yet hundreds of thousands of homes are owned outright in the city.
Did a new CEO just move into town?
Did Ken decide to move back? Lol.
“A modern mansion in Lincoln Park sold today for $14.25 million, the second-highest home price of the year so far, after finding a buyer quickly.
Paul and Monica Kleppes put the seven-bedroom, 15,000-square-footer on Dickens Avenue up for sale in late July, asking $15 million. It went under contract to a buyer Sept. 10, after less than 50 days on the market.”
In 2007, the Kleppes family of five was living in a house across the street when this site, three-tenths of an acre where a portion of Augustana Hospital had stood, went up for sale. The public records are unclear on what they paid for it, but Paul Kleppes said earlier this year that it was about $6.3 million.
The house, the work of Chicago architect Kathryn Quinn, took about seven years to design and build. Paul Kleppes said the total investment to build the house, including the cost of the land, came to about $20 million, or more than they were asking when they put it up for sale.
https://www.chicagobusiness.com/residential-real-estate/lincoln-park-mansion-sells-second-highest-price-2024
Maybe that woman who won the $300 million mega millions in Illinois a few months back bought it? Lol.
“Less than 1% of single family homes are owned by corporations.”
Typical Sabrina dishonesty. Were we discussing SFH?
“In Chicagoland, as of 2022, the number who owned their homes without a mortgage (includes condos and townhouses) rose to 36% from 33% in 2017. In Cook County, latest data I saw was several hundred thousand homes owned outright. That is massive financial firepower and just really gives those owners freedom to sell and move if they desire to.”
Again this includes investor owned
So “Several hundred thousand homes” is 36% of non-apartment housing?
“The people with low rates may not want to move, but it’s not stopping thousands of others in Chicago.”
But it is affecting supply, which is what I said
You are dense
“For comparison, there were just 5,000 homes on the market at the end of last month. Yet hundreds of thousands of homes are owned outright in the city.”
Are you drunk?
What does this have to do with anything being discussed?
“What does this have to do with anything being discussed?”
You have argued that there won’t be inventory because everyone is trapped in their homes hoarding their 3% rates. Yet there are over 200,000 homes owned outright in the city of Chicago. Those people don’t care about 3% rates, 5% rates, any rates. They can sell tomorrow and buy somewhere else in all cash.
Yet there were only 5,000 homes on the market at the end of September. The old low rate mortgages aren’t the only thing keeping inventory near record lows.
“ure. Lots of people aren’t going to give up their rate. But 40% of all homes have no mortgage. Those people don’t care. ”
———————————–
So the fact that I get a mortgage when I sell my current, debt-free, house to buy a new one in Florida/North Carolina/Arizona/wherever isn’t a factor for me? Good to know!
“Typical Sabrina dishonesty. Were we discussing SFH?”
Corporations own even less of all condos.
Chicago isn’t a big investor owned city. We have strict restrictions on STR and the housing bubble, and bust, was so severe it chased many buyers away for forever. Also, our price appreciation has lagged most other parts of the country for well over a decade so why would you invest here?
For instance, we actually used to have Chinese investors in Chicago in 2007-2008. But that has died off over the last decade. Also, the Chinese government has put restrictions on how much money can leave the country. But the Chinese investors are only flocking to Orange County and Seattle and a few other markets. They are probably in FL and TX. Chicago is not it. And during the pandemic, some who remained panic sold and got out as renters fled to the suburbs and vacancies downtown spiked 15%. Occupancy has returned though.
“So the fact that I get a mortgage when I sell my current, debt-free, house to buy a new one in Florida/North Carolina/Arizona/wherever isn’t a factor for me? Good to know!”
You won’t get a mortgage for your new home johnc. All cash buyers remain high and they are not all investors. Baby Boomers have a ton of firepower. Older GenX too. If you bought during the housing bubble in Chicago, you’ve been paying about 20 years on that loan. Over the next 5 years, I expect the number owning their homes outright to surge even higher than 36%.
“Corporations own even less of all condos.”
Link?
“Chicago isn’t a big investor owned city. We have strict restrictions on STR and the housing bubble, and bust, was so severe it chased many buyers away for forever. Also, our price appreciation has lagged most other parts of the country for well over a decade so why would you invest here?”
You wernt talking about Chicago
“For instance, we actually used to have Chinese investors in Chicago in 2007-2008. But that has died off over the last decade. Also, the Chinese government has put restrictions on how much money can leave the country. But the Chinese investors are only flocking to Orange County and Seattle and a few other markets. They are probably in FL and TX. Chicago is not it. And during the pandemic, some who remained panic sold and got out as renters fled to the suburbs and vacancies downtown spiked 15%. Occupancy has returned though.”
You always do this when you’re wrong. Go off on some far flung tangent that has nothing to do with whats being discussed and throw in a lot of useless handwaving in an attempt to “prove” some non-existent point