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Home Foreclosures in Chicago Cut Prices and Drove Up Sales

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By : John Cutts    99 or more times read
Home foreclosures in Chicago drove up residential sales in January this year, as home buyers took advantage of big discounts in home prices, based on reports from the Illinois Association of Realtors.

Total house sales in the Chicago metro area climbed up to 3,922 units of single-family houses and condos, an increase of more than 29 percent from total sales in January last year. The January sales marked the seventh straight month that house sales increased on a year-over-year basis.

The median sales price for real estate homes sold in January in the area was $175,000, a drop of 5.4 percent from the January 2009 median of $185,000. Within the city of Chicago, the median sales price was $195,000, a drop of nearly 5 percent from the January 2009 median.

The drop in home prices certainly attracted a lot of homebuyers as total sales within Chicago soared to 1,202 units, marking more than 31 percent of increase from the January 2009 sales.

Sales of condo units within Chicago also soared by 38.2 percent to 655 units. The median sales price also plunged year-over-year by 9.4 percent to $279,900 as home foreclosures in Chicago kept pushing down property values.

Among counties in the Chicago metro area, the biggest increases in sales occurred in Kane, where sales rose by 43.3 percent; in Kendall, where sales jumped up by 41.1 percent; and in Cook, where sales climbed up by 35.8 percent. Sales in McHenry, Lake and Will counties increased by 28.8 percent, 18.4 percent and 5.4 percent, respectively.

The impact of Illinois home foreclosures on home sales was also significant. Total home sales statewide rose in January this year by 14 percent as house prices were still affordable despite a slight increase. The median sales price statewide was $145,300, which marked a small gain of 0.2 percent over the January 2009 median price.

Although the year-over-year price increase in January was small, it was significant because it marked the first time the statewide median price rose since September 2007.

Geoffrey Hewings, head of the regional economics laboratory at the University of Illinois, said that median home prices throughout the state will increase but only moderately. He added that the Chicago metro area will continue to post a median sales price lower by about six percent than the January 2009 median. This is because home foreclosures in Chicago will keep on putting a downward pressure on home prices.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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