Chicago-area home sales improve in July, but median price drops - City doesn't follow trend; sales decline 11.3%

Chicago-area home sales improve in July, but median price drops - City doesn't follow trend; sales decline 11.3%
By Mary Ellen Podmolik
Copyright © 2009, Chicago Tribune
August 22, 2009
http://www.chicagotribune.com/classified/realestate/chi-sat-home-sales-0822-aug22,0,3098769.story

With bargain hunters and first-time buyers fueling the market, July home sales in the Chicago-area posted a sixth consecutive monthly gain and the first year-over-year increase in three years.

The last time sales in the Chicago area, as well as the state, broke even with the year-earlier period or showed a gain was March 2006, the Illinois Association of Realtors said Friday.

Local sales of existing single-family homes and condos rose to 7,427 properties in July, the association said. Sales were up 0.3 percent from July 2008 and 4 percent from June.

The median sales price in the Chicago area was $213,500 in July, up 1.7 percent from $210,000 in June 2009. The median price was down 16.3 percent from $255,000 in July 2008.

The median price is the price at which half the homes were sold for more and half for less.

"It appears that there are more problems at the high and low ends of the market, but there is evidence that distressed sales, through foreclosure and short sales, decreased in May and June to the 31 to 33 percent range of total sales, from a high close to 50 percent during the first part of the year," said Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory at the University of Illinois.

There is some trepidation on the part of real estate agents that the market will sour with the expiration of the first-time buyer's credit. To qualify for the credit of up to $8,000, buyers must close on home purchases before Dec. 1. The housing industry has called on lawmakers to extend the tax credit and expand its eligibility to all buyers.

Typically, August is a slow month for the industry, but so far the activity has been encouraging.

"I don't think we're going to see the market trends now follow the normal path," said Donna Zupancic, an agent with @Properties in Evanston. "It's definitely more busy. We're showing a lot of houses. I've shown as many as 40 to 45 houses to one buyer, but they're much more confident. I would put a house on the market now without batting an eye."

Housing sales in Chicago did not share in the uptick and remain challenged. Sales fell 11.3 percent from July 2008, to 1,975 properties, and were down 0.4 percent from June. The median price, while rising 1.1 percent from June to July, to $245,000, was down 18.3 percent from July 2008.

Distressed properties are being bought but lending requirements remain a key challenge to the market, said David Hanna, a Chicago real estate agent and president of the Chicago Association of Realtors. "We are a long way from seeing a stable real estate market in Chicago," he said.

As a whole, home sales in Cook County rose 2.5 percent from July 2008. Other counties that saw year-over-year gains included Kendall County, up 19.7 percent; Lake County, up 6.5 percent; and Will County, up 1.1 percent. The other five counties in the Chicago area posted year-over-year declines, ranging from 0.6 percent in DuPage County to 17.4 percent in McHenry County.

Without exception, median sales prices fell in all counties, and two of the counties that reported the best sales performance, Kendall and Lake, saw their median sales prices fall 24.7 percent and 22.2 percent, respectively.

Agents report some homes that had been on the market and then were removed, have been re-listed and at significantly lower prices.

"That's the key right now," said Bob Kroll, an agent at Century 21 Pride in New Lenox. "If you've got a realistic seller and a realistic buyer, you're going to get a sale."

Statewide, July sales of 11,407 homes were flat with a year ago, and were up 4.2 percent from June.

mepodmolik@tribune.com