Market Conditions: February Chicago Home Sales Rise 31.1% Year Over Year; Median Price Fell 4.9%
I missed the release of the February home sales which was out yesterday from the Illinois Association of Realtors.
We’re seeing the same trends as were apparent in January, as sales have risen year over year but the median price continues to be weak. I wish the IAR would break out the sales according to distressed sales versus those that were not- but they don’t.
From the Illinois Association of Realtors:
In the city of Chicago, January total home sales (single-family and condominiums) were up 31.1 percent to 1,202 sales compared to 917 homes sold in January 2009. The city of Chicago median price in January 2010 was $195,000 down 4.9 percent compared to $205,000 a year ago in January 2009.
“2010 has started off with an increase in the number of units sold in January over the same period in 2009. We remain hopeful that while distressed properties are being absorbed, homebuyers on the fence will take advantage of the extended and expanded homebuyer tax credit, and consider this a great time to buy a home,” said REALTOR® Genie Birch, president of the Chicago Association of REALTORS® and a broker associate with Koenig & Strey GMAC, Chicago. “While the greatest hurdle is still securing financing, the current market has tremendous opportunities for homebuyers and investors looking to expand their portfolios.”
Sales also rose 29.2% in the Chicagoland area.
January sales in Chicago were also 3.5% higher than January 2008. Here’s the breakdown of sales of condos and single family homes in Chicago the past 3 years:
- January 2008 sales: 1161
- January 2009 sales: 917
- January 2010 sales: 1202
Illinois Home Sales Increase 14 Percent in January from a Year Ago; Statewide Median Price Up 0.2 Percent to $145,300 [Illinois Association of Realtors, Press Release, February 26, 2010]
“I wish the IAR would break out the sales according to distressed sales versus those that were not- but they don’t.”
They wont, because they’re twisting the data to look as good as it possibly can. I’m sure the distressed sales are the only thing helping out the industry right now. Prices will continue to fall due to an influx of distressed sales for the next few years. Which is a good thing because the market needs to correct itself to get back on track.
No amount of stimulus money will prop this mess up. We just need to bite to bullet and get through it.
Other states report the distressed sales data by breaking it out in the numbers. It’s too bad Illinois doesn’t do it.
In the national January number, I think it was 38% of all sales were distressed properties.
In my day to day experiences as a Chicago area home inspector it would appear that the 38% number is not far off.
It can take months and months to close on a short sale. Calculated Risk is calling 2010 the year of the short sale because they think that banks will pursue short sales rather than modifications. However, Obama keeps revising HAMP which IMHO has been a failure. But OTOH, companies like redfin won’t even do short sales because they fall through so often. The oft repeated saying is that takes 3 contracts with 3 different buyers before a short sale will complete.
1) Regardless of the mix of distressed sales the inventory is being blown through at a pretty good clip. We’ve been seeing declining inventories and market times.
2) Whether or not a short sale goes through depends upon the caliber of the agents involved on both sides of the transaction. Does the listing agent know what the bank requires? Have they had their clients prepare the short sale package? Does the listing agent know who to contact at the bank and where to submit the information? Has the listing agent determined the cycle time for the process to complete and have they prepared both sides of the transaction for that time? Has the buyer’s agent explained the process to their client and does their client have reasonable expectations? Is there a common understanding of what the bank will accept? Has the listing agent succeeded in making the bank realistic?
I’ve spoken to too many listing agents that are clueless and seen too many buyer’s agents that are unrealistic.
I have some data on the percentage of distressed home sales for January in the city.
81 short sales (or 6.7%)
429 foreclosure sales (or 35.3%)
8 court sales (or 0.7%)
Total for distressed sales of 42.6% or 518 sales out of 1217 sales.
Non-distressed sales totaled 699 or 57.4%.
Some neighborhoods of interest:
Lakeview saw 55 sales of which only 2% were distressed sales- only 1 foreclosure.
Lincoln Park had 52 sales and 8% where distressed sales (2% short sales, or 1 sale, and 6% foreclosures, or 3 sales).
Near North Side had 115 sales and 20% were distressed.
Near South had 41 sales and 20% were distressed.
On the far north side, the numbers get worse.
Rogers Park saw 20 sales in January and 70% were distressed. West Ridge saw 33 sales and 64% were distressed.
Those numbers look pretty grim overall. I’m surprised Lakeview had the least amount of distressed sales. Then again this was only one month.
What is the definition of a distressed sale? Does this include foreclosures, short sales, and something else?
I’d like to assert the weather did play a role in dec. numbers and with feb./march seemingly warmer housing numbers will bump-up soon(2-3mos). the volume low hasn’t been busted, the price low will inversely follow employment, with a lag.
(it actually was very much colder in December because of a warm November (avg 20-30 deg difference), so i could imagine people saying in. The only ‘warm spell’ in dec. came a week b4 Christmas which i think people used to shop and travel. (chicago area only/not national weather). )
*un-employment; OR ‘housing numbers will follow employment’ but lagged
“What is the definition of a distressed sale? Does this include foreclosures, short sales, and something else?”
It includes foreclosures, short sales and court sales. Although, from the data I’ve seen for January, nearly all of the “distressed” sales are foreclosures and short sales (very few are court sales.)
Pretty grim data. Imagine how bad it will be when the tax credit goes away in certain neighborhoods, especially on the fringes, like the RP.
So median price is off 4.9% from last January. Does anyone know what we are off from peak? Has Chicago hit 20%? Also, is there good neighborhood specific data anywhere, as I’m sure some neighborhoods are doing worse than others.