Home Sales Down from a Year Ago
SPRINGFIELD, Ill., Oct. 24 /PRNewswire-USNewswire/ — “Consumer sentiment and the degree of optimism they express in terms of their behavior in the market over the next few months will determine the length of the housing market slump,” says Dr. Geoffrey Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois in a forecast prepared for the Illinois Association of REALTORS(R) (IAR).
While home prices in Illinois reported positive growth in September, sales reflected lingering effects from tightening credit issues experienced earlier in the year. According to IAR’s latest report, the Illinois median home sale price in September was $200,000, up 0.8 percent from $198,500 in September 2006. The median is a typical market price where half the homes sold for more, half sold for less. The statewide average home sale price in September was $264,749, up 4.6 percent from $253,139 a year ago.
There were 10,476 total home sales (which include single-family homes and condominiums) in September 2007, 22.9 percent below September 2006 which logged 13,594 home sales. Year-to-date, sales were down 15.4 percent to 112,278 homes sold January through September 2007 compared to 132,784 homes sold during the same period last year.
“Most Illinois homeowners are experiencing very healthy long-term gains in the value of their homes, and real estate remains the single best investment over the long term providing wealth accumulation especially for those who keep the home for a typical holding period of six to 10 years,” said REALTOR(R) Kay Wirth, president of the Illinois Association of REALTORS(R). “Market basics are solid and with low mortgage interest rates, strong household formation and job creation–moving forward these factors should bode well for a recovery in the housing economy.”
The monthly average commitment rate for a 30-year, fixed-rate mortgage for the North Central region was 6.41 percent in September 2007, down 0.17 points from the 6.58 average rate during the previous month, according to the Federal Home Loan Mortgage Corporation. Last year in August it averaged 6.46 percent.
The median home price for the Chicagoland Primary Metropolitan Statistical Area (PMSA) was $257,500 in September, up 5.1 percent from $245,000 in September 2006. The average home sale price for Chicagoland was $327,855, up 5.9 percent from $309,710 in September 2006. In the Chicagoland PMSA, home sales totaled 6,794 in September 2007, down 27.0 percent from 9,307 home sales in the same month last year.
“Monitoring of housing-related sales will provide some indication of the degree to which consumers anticipate an easing of the downturn in the months ahead,” Hewings said. According to REAL’s September forecast , the Illinois median price will uptick in October with modest declines year-over-year anticipated in the cyclically slower sales months of November and December.
In the latest forecast from the National Association of REALTORS(R), senior economist Lawrence Yun says widening credit availability will help turn around home sales: “Conforming loans are abundantly available at historically favorable mortgage rates. Pricing has steadily improved on jumbo mortgages since the August credit crunch, and FHA loans are replacing subprime mortgages.”
Says Wirth, a broker with Re/Max Unlimited Northwest in Crystal Lake: “Those looking to buy now have an advantage with a large inventory to choose from and room to negotiate.”
Sales and price information is generated from a survey of Multiple Listing Service sales reported by 35 participating Illinois REALTOR(R) local boards and associations. The Chicagoland 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(R) is a voluntary trade association whose 60,000 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(R) 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.
SOURCE Illinois Association of REALTORS
© 2007 PR Newswire. All Rights Reserved.