Monday, May 24, 2010

Chicago..City Home prices rise for first time ..Carpe Diem. Unprecedented time to buy

The median price of a home sold in the city of Chicago last month rose for the first time in 22 months, with all of that gain coming from the sale of single-family homes.

For the entire metropolitan area, the median home price didn't break the string of declines seen since March 2008. But with a decrease of just 0.5 percent, it was the best report in some time.

"I'm ecstatic about it," said Genie Birch, president of the Chicago Board of Realtors. "The free fall stopped. There's a bottom and then you make your way up. I think we are on the road to recovery if all the variables stay in place."
The news on pricing came as the Illinois Association of Realtors reported Monday that April existing homes sales in the Chicago area rose for the 10th consecutive month, year-over-year, to 7,071 single-family homes and condominiums sold last month. It was a 47.1 percent sales volume gain since April 2009.

Within the city, sales rose 41.1 percent, to 1,407 homes sold, in the eighth consecutive month of year-over-year gains while the median price increased 3.2 percent to $225,000. Sales of single-family homes rose 25.4 percent to 791 homes, which were sold at a median price of $155,000 -- a 14.8 percent increase.

Meanwhile, sales of condos within Chicago rose 53.9 percent, to 1,194 homes sold. The median price of $278,012 was a 3.9 percent decrease.

"For the first time since the recession began, the housing markets in Illinois and Chicagoland region almost presented positive indicators across the board," said Geoffrey J.D. Hewings, director of University of Illinois' Regional Economics Applications Laboratory in a statement. "Sales continue to exhibit positive increases through April, and the forecasts suggest a continuation of these trends through July."

All nine of the counties in northern Illinois recorded substantial double-digit sales volume gains of between 24 and 77 percent last month. But only Lake County showed a significant year-over-year gain in median home prices, with a 11.2 percent increase to $200,000 in April. The median home price rose 1.8 percent in Cook County, to $195,000. Other counties posted decreases.

Despite the good report, questions remain over whether the housing market can sustain any momentum generated by the now-expired home buyer tax credit. In order to qualify for the tax credit of up to $8,000, consumers had to have a contract signed on a home by April 30, and must close on the purchase transaction by June.

There's some evidence that those first-time sellers have now exited the market, as only 43.4 percent of April's home purchases were attributed to first-time home buyers, compared with 48.2 percent of buyers in March, according to a Campbell/Inside Mortgage Finance monthly survey.

Last week, the Mortgage Bankers Association reported that mortgage loan applications for home purchases for the week ended May 14 fell 27 percent from a week earlier, to the lowest level of applications in 13 years, and applications had declined almost 20 percent during the past month.
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