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Chicago Homes - May 2008
Number of Chicago homes on market jumps 5.9 percent in April,
prices plummet 24 percent
If you're looking to get in the market for a new or re-sale single-family home, now may be the time to snatch up one of the many deals currently on the market. Real estate listings for new and re-sale homes on the market rose by 5.9 percent in April, according to a report by ZipRealty Inc published on May 8. Chicago saw the biggest increase in the number of homes on the market of the 29 metropolitan regions around the country included in the repot. According to MLS data collected on May 15, there are currently a total of 9232 new and re-sale single-family homes on the market.
While the supply of homes on the market jumped in April, the demand for all single-family units around the city was down sharply during the month. According to sales data for the city collected from the MLS, a total of 546 new and re-sale single-family homes were sold during April 2008, down from 709 homes sold during the same month last year. The drop in demand is even more pronounced when looking at sales in the city of Chicago in 2006. A total of 949 homes were sold in April 2006.
The average sales price in April fell by an amazing 24 percent from the same month last year. However, the drop in prices was not so pronounced for individual homes around the city. Rather, demand is shifting towards more affordable Chicago homes for sale and Chicago condos lofts. Buyers in traditionally more expensive neighborhoods found in the northern half of Chicago picked up a total of 110 homes priced under $250,000 in April 2008, up from just 33 homes a year ago. Demand for single-family homes priced over $1 million fell from 37 in April 2007 to just 21 during April of this year.
The Chicago suburbs are also seeing a drop in demand and falling prices for new and re-sale single-family homes. According to first quarter data from the Chicago Association of Realtors, sales in the suburbs were down to their lowest level in 17 years in 2008. A total of 6,347 single-family homes were sold in the Chicago suburbs, down from 9,387 homes sold during the same period in 2007. The record for the first quarter was seen in 2005, with 11,947 single-family homes sold around the suburbs.
Prices for new and single-family homes hit their lowest point since 2005 in the suburbs. The average sales price fell to $299,684 for the quarter, down from the record high seen last year of $337,086.
The weak Chicago real estate market led to a couple of high profile bankruptcies in the Chicago region. The largest company to file for Chapter 11 in the Chicago region was Neumann Homes, who closed their operations on November 1, 2007. Kimball Hill became the second major Chicago home builder to file for bankruptcy on April 24, 2008.
With so many new and re-sale homes coming on the market and sales reaching new lows in both Chicago and the suburbs, now may be the right time for buyers looking to take advantage of opportunities on the market. Negotiate for a price that reflects the current market conditions in the Chicagoland region.