Slower First Quarter Home Sales in Metro Chicago Real Estate Market Don’t Tell Full Story, RE/MAX Reports

Chicago, IL – April 28, 2011 – (RealEstateRama) — First quarter home sales and median home prices in the seven-county metropolitan Chicago real estate market both registered declines of 11 percent when compared to the same period in 2010, but those figures don’t tell the whole story, according to an analysis by the RE/MAX Northern Illinois real estate estate network.

Home sales activity rose in 30 percent of city and suburban markets during the first quarter of this year, and while median prices declined, much of that decline resulted from the fact that the percentage of homes selling for less than $250,000 increased from 68 percent of all sales in the first quarter last year to 72 percent this year.  At the same time, homes selling for $250,000 to $450,000 fell from 21 percent of all sales in the first quarter of last year to 18 percent of sales this year.

Home sales in the metro area totaled 12,842 units compared to 14,425 a year earlier, while the median home price dipped to $156,900 from $176,000, based on sales figures compiled by Midwest Real Estate Data, LLC, (MRED), the multiple listing organization for the Chicago area.  RE/MAX analyzed the MRED data for the counties of Cook, DuPage, Kane, Kendall, Lake, McHenry and Will.

Of the 258 suburban market areas and 77 city neighborhoods tracked by RE/MAX in the metro area, the number of homes sold rose in 76 suburban markets and 23 city neighborhoods.  Sixteen other suburban markets and four neighborhoods where homes changed hands reported the same number of sales as they had last year.

“Home sales were strongest at the lower end of the market as bargain hunters, especially investors, made up a growing percentage of home buyers,” said Jim Merrion, regional director of RE/MAX Northern Illinois.  “Sales of attached homes that closed for under $250,000 were down less than 1 percent compared to last year, and sales of detached homes in that same price range fell 7.8 percent.”

At the top of the market, the number of detached homes selling for $1 million or more declined just 6.1 percent to 185 units, but sales of attached homes in that price range fell 36.6 percent to 52 units.

Merrion noted that the relatively robust demand for low priced homes contributed to a substantial decline in median prices.  The median price (at which half of homes sell for more and half for less) of an attached home was $132,000 during the first quarter in the metro area, down 23.5 percent from the year-earlier period.  In contrast, the median price of a detached home dipped just 5 percent to $171,000.

“We’ve seen a shift in the market in recent months, with properties involved in foreclosures and short sales representing close to 50 percent of all homes sold, and that has contributed to the decline in median prices,” Merrion said.  “We expect the market share of that distressed segment to shrink during the second and third quarters, which should help stimulate a rebound in median prices.”

The following are summaries of home sales activity in each of the seven counties, as well as the City of Chicago.

City of Chicago

Total first-quarter residential sales activity in Chicago was 3,583 units, 17.5 percent less than last year.  Sales of detached homes declined 17.8 percent to 1,592 units, and sales of attached homes fell 17.3 percent to 1,991 units.  Sales of detached homes rose in 23 of 77 city neighborhoods, with a majority of increases concentrated on the Northwest and Southwest Sides, including Belmont Cragin, Gage Park, Logan Square and West Elsdon.

Sales of attached units also rose in 23 neighborhoods, primarily on the Northwest Side and along the South Lakefront, but no city neighborhood with 25 or more attached sales recorded an increase in activity.

The median price of a detached home was $120,500, down 3.6 percent from the first quarter of last year.  The median attached home price fell 26.4 percent to $195,000.

Cook County

Cook County saw its residential sales activity fall 13.3 percent in total to 7,600 units, with sales of detached homes down 14.4 percent to 4,306 units and attached sales activity slipping 11.8 percent to 3,294 units.

Increased sales of detached homes were reported in a number of the county’s southwest and northwest suburbs, including the communities of Alsip, Des Plaines, LaGrange Park, Mt. Prospect, Orland Park, Palatine, Palos Park and Worth.

The first quarter median sales price of a detached home was $149,900, down 2.5 percent from 2010.  For attached units, the median sales price fell 29.3 percent to $145,000.

DuPage County

Residential sales totaled 1,506 units in DuPage County, a decline of 1.1 percent for the quarter.  Detached sales were essentially unchanged at 1,007 units, while attached sales activity fell 1.4 percent to 499 units.  Thirteen of the 35 market areas in DuPage recorded an increase in total home sales.  Among the communities with the largest percentage increases in sales of detached homes were Bloomingdale, Hinsdale, Lisle, West Chicago and Winfield.

The median sales price of a detached home in the county was $240,000 during the first quarter, down 9.8 percent from a year earlier.  For attached homes, the median sale price fell 18.3 percent to $116,000.

Kane County

Kane County recorded the smallest percentage decrease in total sales of any county in the metro area during the first quarter of 2011.  Homes sales totaled 892 units, 3 percent less than the prior year.  Detached sales were essentially unchanged at  731 units, generating a median sales price of $160,000, down 6.4 percent from the prior year.  Attached home sales totaled 161 units, a 13 percent decline, and the median sales price fell 15.2 percent to $120,000.

St. Charles, Carpentersville-Lake Marion and East and West Dundee showed notable increases in sales of detached homes.

Kendall County

Sales activity in Kendall County registered a decline of 10.5 percent for the quarter, with sales totaling 255 units.  Detached sales (190 units) slipped 10.8 percent, and attached sales (65 units) were down 9.7 percent.  The median sales price of a detached home in Kendall fell 7.5 percent to $184,900.  The median sales price of an attached unit fell 23.4 percent to $100,000.

Lake County

Home sales in Lake County were only 7.8 percent lower for the quarter, with detached sales down 8.4 percent to 881 homes and attached sales off 5.4 percent to 246 homes.  The median sales price was $109,750 for attached homes (down 19 percent) and $200,000 for detached homes (down 11.1 percent).

The area of the county yielding the best results in terms of home sales activity was the northeast quadrant, including such communities as Beach Park, North Chicago, Old Mill Creek-Wadsworth, Winthrop Harbor and Zion.  Deerfield, Lincolnshire and Vernon Hills also saw more units change hands.

McHenry County

McHenry County home sales totaled 472 units for the quarter, yielding a 16.8 percent sales decline, which was the largest of the seven metro counties.  Attached sales fell 32.3 percent to 67 units, while in the detached-home category sales were off 13.5 percent to 405 units.  The median price of a detached home fell 5.3 percent to $170,000, and the median price for attached homes came in at $98,000, down 25.8 percent.

Lake in the Hills, Hebron and Huntley were the only communities in the county to record an increase in home sales for the quarter.

Will County

Will County home sales declined 13.6 percent for the quarter and totaled 990 units, compared to 1,146 units a year earlier.  There were 812 sales of detached homes, a 7.3 percent decrease, and 187 attached home sales, 30.7 percent lower than the total for the first quarter of 2010.

Median prices in Will County proved surprisingly resilient, slipping just 1.8 percent to $176,250 for detached homes and falling 12.7 percent to $120,000 in the attached home category.

RE/MAX has been the leader in the northern Illinois real estate market since 1989.  The RE/MAX Northern Illinois network consists of 2,300 sales associates and 110 individually owned and operated  RE/MAX offices that provide a full range of brokerage services throughout the northern one-third of Illinois.  Its www.illinoisproperty.com and www.remax.com  websites are leaders in consumer visits among real estate brokerage brands.  The northern Illinois network is part of RE/MAX LLC, a global real estate organization with 90,000 sales associates in 83 nations.