The National Assn. of Realtors said a seller’s market was developing as year-over-year home prices in January showed above average growth.
Yes, you read that right. A seller’s market.
Nationally, the median price for existing homes jumped 12.3 percent to $173,600, compared to January 2012, according to the association. It was the 11th consecutive month of year-over-year price increases.
Locally, the signs of the recovery haven’t been as easy to read.
The median price of a Chicago area home increased only 0.7 percent to $141,000 in January 2012, compared to the same period in 2011, according to data from the Illinois Assn. of Realtors.
But experts say those figures don’t tell the whole story. In the last two to three months, the Chicago area market has picked up serious momentum.
It’s not uncommon, they say, for a home in a desirable neighborhood to receive multiple offers and/or come under a contract in just a few days. The number of sales is nowhere near the pre-recession years, in part because banks still aren’t lending.
“But the tide is changing,” says Colin Hebson, a residential agent at Chicago-based DreamTown Realty.
To illustrate his point, Hebson says he recently was the seller’s agent for two condominiums in the same development in the 2900 block of North Sheffield Avenue in the city’s Lakeview neighborhood.
The newer units were identical – both were 1,600 square feet and had two bedrooms and two bathrooms. Both were walk-ups.
The first one sold for $550,000 in December, after only three weeks on the market. The second condo was listed in March, he says.
After less than a week, it went under contract for $585,000, or $35,000 more than the same one that sold only three months ago, Hebson says.
What’s more, a 4,600-square-foot single family home in Lincoln Square recently drew three offers, after the asking price of just under $1 million was lowered slightly, Hebson says. Two years ago that probably would not have happened.
“It’s another sign that demand is increasing,” he says.
The Illinois Assn. of Realtors won’t release February home sales and price data until later this month. It’s unknown what the numbers will show but experts are predicting at least a small uptick.
“Buyer traffic is continuing to pick up, while seller traffic is holding steady,” Lawrence Yun, chief economist for the National Assn. of Realtors, said in a statement. “In fact, buyer traffic is 40 percent above a year ago, so there is plenty of demand but insufficient inventory to improve sales more strongly. We’ve transitioned into a seller’s market in much of the country.”
“We expect a seasonal rise of inventory this spring, but it may be insufficient to avoid more frequent incidences of multiple bidding and faster-than-normal price growth,” he added.