Illinois Housing Market Gains Ground in 2010 in a Tough Economy

4Q10 Home Sales Skewed by Tax Credit

SPRINGFIELD, IL – February 10, 2011 – (RealEstateRama) — The Chicagoland region ended 2010 nearly even with home sales in 2009 while statewide the Illinois housing market continued to ride out the turbulent economic times boosted by sales from the homebuyer tax credits. For the year, statewide total home sales (single family homes and condominiums) were down 3.8 percent in 2010 with 103,710 homes sold compared to 107,782 sales in 2009; in the nine-county Chicagoland PMSA, home sales reached 69,010, off just -0.5 percent from 69,367 home sales in 2009.

According to the Illinois Association of REALTORS® (IAR) fourth quarter report, Illinois home sales (single family and condominiums) totaled 21,957 down 26.6 percent from 29,922 home sales in 4Q09. The 4Q10 statewide median home sales price was $144,000, down 7.0 percent from $154,900 in 4Q09. The median is a typical market price where half the homes sold for more, half sold for less. For the year, the statewide median home price was down 3.2 percent to $152,000 compared to $157,000 in 2009.

“More than 53 percent of homebuyers were first-time buyers, according to the 2010 Profile of Illinois Home Buyers and Sellers, which is more than the national rate of 50 percent and significantly higher than the average since 2001 of 40 percent,” said REALTOR® Sheryl Grider Whitehurst, ABR, CRB, GRI, president of the Illinois Association of REALTORS® and the Development and Operations Coordinator for Traders Realty in Peoria. “The tax credit effect in year-over-year sales comparisons likely will continue in early 2011. Still, we’re seeing some positive signals from the economy, and improvements on the jobs front will help give people more confidence and release some pent-up demand for housing.”

Adds Whitehurst: “Affordability conditions remain good for first-time buyers although credit-worthiness and lender documentation requirements have become hurdles for some would-be buyers. First-time buyers can look to help from the Illinois Housing Development Authority’s SmartMove loan programs that provide up to $6,000 in down payment and closing cost assistance for those who qualify. See www.ihda.org for more information.”

The 4Q10 interest rate for 30-year, fixed-rate mortgages averaged 4.44 percent in the North Central Region, according to the Federal Home Loan Mortgage Corporation. It was down from 4.45 percent in the third quarter and also down from 4.99 percent a year ago in 4Q09.

“Overall median prices seem to be stabilizing or moving back upwards—an encouraging sign—even in MSAs in which the year-over-year changes are forecast to be negative,” said Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois. “Recall the first period of 2010 was a period in which the main effect of the housing stimulus program ended, generating a heightened degree of sales in all markets. As a result, many MSAs will see annual sales decline in March 2011 but the month-to-month changes will often be positive.”

In the Chicagoland Primary Metropolitan Statistical Area (PMSA) total home sales (single-family and condominiums) were down 27.8 percent in 4Q10 to 14,392 homes sold compared to 19,943 home sales in 4Q09. The region’s 4Q10 median price was $172,500, down 7.8 percent from $187,000 in 4Q09. The Chicagoland PMSA median home sale price for 2010 was $185,000, down 5.6 percent from $196,000 in 2009.

In the city of Chicago, total home sales (single-family and condominiums) in 4Q10 were down 32.5 percent to 3,804 sales compared to 5,638 sales in 4Q09. The city of Chicago median price was $195,000, down 9.3 percent from $215,000 in 4Q09.

For the year, home sales in the city of Chicago were off 1.6 percent with 19,089 sales in 2010 compared to 19,398 sales for 2009. The 2010 median sales price for the city of Chicago was down 8.0 percent to $207,000 from $225,000 in 2009.

“The fourth quarter for the city of Chicago shows true signs of stabilization and health returning to the marketplace, and performing without the temporary Federal Homebuyer Tax Credit, which expired in April 2010,” said Mabel Guzman, president of the Chicago Association of REALTORS® and a REALTOR® with Envision Real Estate LLC, Chicago. “The Chicago condo market during this period showed an increase in the average price of 4.7 percent, to $331,131, up from $316,163 during the same time in 2009. Single-family homes, respectively, increased in average price by 7.2 percent to $230,957 versus $215,527 from the same period in 2009. Additionally, closed median prices across the property types show signs of leveling in 2010 despite the presence of distressed assets throughout the city of Chicago.”

Forty-three of 98 Illinois counties reporting showed year-over-year median home price increases or no change for 4Q10 including Grundy, up 3.8 percent to $149,900; Iroquois up 4.4 percent to $69,950; Knox, up 10.2 percent to $69,000; Macon, up 3.4 percent to $87,900; McLean, up 14.1 percent to $165,500; Peoria, up 12.1 percent to $123,000; Saint Clair, up 11.3% to $128,000; Sangamon, up 4.3 percent to $120,000; Stephenson, up 13.6 percent to $90,000; and Tazewell, up 5.4 percent to $125,425.

Sales and price information is generated from a survey of Multiple Listing Service sales reported by 35 participating Illinois REALTOR® local boards and associations. The Chicago PMSA, as defined by the U.S. Census Bureau, includes the counties of Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will.

The Illinois Association of REALTORS® is a voluntary trade association whose 46,000 members are engaged in all facets of the real estate industry. In addition to serving the professional needs of its members, the Illinois Association of REALTORS® works to protect the rights of private property owners in the state by recommending and promoting legislation that safeguards and advances the interest of real property ownership.

Find Illinois market stats data and the Illinois Profile of Home Buyers and Sellers at www.illinoisrealtor.org/marketstats.

** Economist Geoff Hewings will be available for media interviews between 9 a.m. and noon CST on Thursday, February 10.

Contact:
Mary Schaefer/Ann Londrigan
217-529-2600