The Up

Home Sales are Up and Down

We are seeing the continuation of a trend that seems hopeful. According the Illinois Association of Realtors® home sales in Chicago for April 2009 were up when compared to March 2009 by 16.7 percent. There were 1,378 home sold in April as compared to 1,181 in March. This seems to reflect the time of year (sales are usually strongest in the spring of the year). Hopefully this also represent some evidence that, at a minimum, the downward spiral of real estate sales is declining. It would be nice if it signaled even more?that the bottom has been reached. However, it’s difficult to find any credible analyst willing to say that.

Most analysts attribute the three month to price drops (see below) and purchasing of foreclosures. First-time buyers are figuring heavily in this as well because of the $8,000 tax credit being extended to them.

The Down

The 16.7 percent month-on-month increase is only part of the story. When we compare to 2008, sales are down a whopping 26.9 percent. This means in April of 2008, 1,886 homes were sold in Chicago.

The Price

Median home prices in Chicago did not change month-on-month; prices held steady at $220,000 in April. This is down 26.7 percent from $300,000 in April 2008.

The Illinois Association of Realtors® web site quotes David Hanna, president of the Chicago Association of REALTORS® saying,

?We continue to see homes in foreclosure and short sales driving prices lower in many areas of the city. Policy changes such as allowing first-time homebuyers to use the $8,000 tax credit at closing and a streamlined process for short sales will help, but the critical issues are the rising numbers of foreclosures and restrictive lending guidelines not crafted for our urban market. The federal loan modification program has not yet slowed the pace of foreclosures, a must for turning housing around in the Chicago metropolitan area. Regulators and lenders need guidance and latitude in creating a lending environment that addresses regional and in particular urban housing differences. That is not happening right now, and our numbers reflect the result.?

We would like to thank TheTruthAbout once again sharing today’s photo via the Creative Common’s License.