Market Conditions: June 2023 Sales Plunge 25.1% YOY on Low Inventory
Two years ago, June sales were at new highs. It was so hot, that June 2021 was better than even the bubble year Junes.
But last year, mortgage rates spiked over 5% in June and that pushed down sales. In 2023, mortgage rates were even higher, over 6%. And June sales fell again.
It was the slowest June since June 2020, when the pandemic spooked the real estate industry and froze many buyers and sellers.
From the Illinois Association of Realtors:
The city of Chicago saw a 25.1 percent year-over-year home sales decrease in June 2023 with 2,541 sales, down from 3,393 in June 2022.
The median price of a home in the city of Chicago in June 2023 was $355,000, down 3.3 percent compared to June 2022 when it was $367,000.
Thanks to G for the historical sales data:
- June 1997: 1,817
- June 1998: 2,214
- June 1999: 2,435
- June 2000: 2,513
- June 2001: 2,451
- June 2002: 2,590
- June 2003: 2,891
- June 2004: 3,752
- June 2005: 3,850
- June 2006: 3,557
- June 2007: 3,127
- June 2008: 2282
- June 2009: 1981
- June 2010: 2526 (tax credit sales)
- June 2011: 1841
- June 2012: 2246
- June 2013: 2729
- June 2014: 2846
- June 2015: 3202
- June 2016: 3321
- June 2017: 3380
- June 2018: 3191
- June 2019: 2850
- June 2020: 2072
- June 2021: 3908
- June 2022: 3393
- June 2023: 2541
Here is the monthly median price data:
- June 2008: $309,945
- June 2009: $242,050
- June 2010: $234,250
- June 2011: $207,000
- June 2012: $216,700
- June 2013: $254,900
- June 2014: $275,000
- June 2015: $288,250
- June 2016: $299,900
- June 2017: $306,750
- June 2018: $314,900
- June 2019: $319,000
- June 2020: $329,000
- June 2021: $350,500
- June 2022: $367,000
- June 2023: $355,000
“Compared to May, the June data shows market activity is increasing, as summertime in Chicago continues to be a popular time of year to buy and sell,” said Sarah Ware, president of the Chicago Association of REALTORS® and principal and designated managing broker for Ware Realty Group in Chicago.
“Buyers and sellers are realizing that mortgage rates likely won’t hit the all-time lows we saw a few years ago and are making moves when they’re ready.”
The 30-year fixed rate mortgage was 6.71% in June 2023 up from May 2023 which was 6.43% and definitely higher than June 2022 which was 5.52%.
“The trend of rising prices and declining sales continued during June,” said Dr. Daniel McMillen, head of the Stuart Handler Department of Real Estate (SHDRE) at the University of Illinois at Chicago College of Business Administration.
“Our forecasts indicate that prices will begin their expected seasonal decline over the next three months, while the number of sales continues to decline. Surveys suggest that consumer confidence in the economy has begun to increase again, which may moderate these trends toward declining prices and sales.”
Statewide, Illinois inventory declined 33.2% to 18,886 properties from 28,265 in June 2022. The IAR said it was the 4th lowest monthly average for inventory since 2008, which was when IAR started keeping the data.
In Chicago, inventory fell 32.2% to 5344 properties from 7883 a year ago. That continues the trend of declining inventory as the inventory was 9008 in June 2021.
- June 2021: 9008
- June 2022: 7883
- June 2023: 5344
The number of days on the market was up in Chicago by 7.7% to 28 days from 26 days last year.
On the price decline, most of it came from single family homes which fell 6.2% to $332,500. Condo prices were flat year-over-year at $375,000.
As we’ve seen the last few months, in Chicago June sales, it was condos which fell the most, at 29.4%, to 1607 while single family home sales fell 16.3% to 934.
Inventory remains tight and mortgage rates have remained elevated in July. But we are now coming up on better year-over-year comps. A year ago, the slowdown was already hitting.
Can monthly sales turn it around with inventory this low?
Illinois’ statewide home sales and housing inventory dipped in June [Illinois Association of Realtors Press Release, by Bill Kozar, July 20, 2023]