Monday, April 28, 2008

CHICAGO’S HOUSING MARKET IS FULL OF OPPORTUNITY FOR SMART SHOPPERS

“Chicago’s housing market is full of opportunity for the smart real estate investor and knowledgeable home buyer.”

That optimistic forecast comes from David Hanna, president-elect of the Chicago Association of Realtors, who also noted that the budding condominium resale market in the city is starting to show signs of life this spring.

“The Chicago condominium market continues to see significant appreciation, with the median condo price in March rising to $317,900, a gain of 8 percent from the median price in March of 2007,” Hanna said.

The median price of single-family homes in Chicago during March increased by more than 5 percent, compared with the same month a year ago. “This shows great promise for Chicago’s homeowners and those interested in getting into the marketplace,” Hanna said.

There were 2,045 total sales (both single-family homes and condominiums) in Chicago in March, a decline of 11.5 percent from 2,311 homes sold in March of 2007. However, the median price of homes in Chicago increased 5.3 percent to $300,000 compared to $285,000 in March of 2007.

According to the Illinois Association of Realtors’ (IAR) latest report, total sales—including both homes and condominiums—were up a whopping 24.5 percent to 8,509 units in March of 2008 compared with February, 2008 sales of 6,832 units.

However, total sales volume was still down 29.5 percent from the 12,075 units sold in March of 2007.

“Right now is a very good time for Illinoisans waiting to buy a house to enter the market for many reasons including mortgage interest rates below 6 percent,” said Realtor Kay Wirth, president of the IAR. “There is a lot of pent-up demand, even though people are being cautious given the uncertainty in the overall economy. The spring market is here and now is an ideal time to check out ample inventory in your area to purchase your dream home.”

Lawrence Yun, chief economist of the National Association of Realtors said: “Existing home sales could start to show a sustained increase within a few months, unless there are some additional economic or inflationary pressures.”

Yun forecast stable resale home sales in the near term before higher mortgage limits translate into sales in high-cost markets. “The wider access to affordable credit should increase sales activity this summer as pent-up demand begins to be met,” he said.

If there is one gloomy trend in the marketplace it the nationwide freezing of home equity lines of credit at some banks, experts say. Reeling from losses on the bad loans banks made in recent years, many troubled lenders are preventing borrowers with excellent credit from tapping into their home equity.