Data from the Illinois Association of Realtors showed that sale of existing dwellings and distressed properties for sale in Chicago has declined in August 2010 by 24% when compared with the same period of 2009. The August decline is the lowest level recorded for the past 10 years, realtors have added.
According to housing market analysts, the decline in sales of existing residences and Illinois distressed properties for sale, particularly in Chicago, was partly due to the fact that majority of contracts inked during months of strong home buyer activities, caused by the federal tax credit program, have closed.
Following the tax credit deadline, buyers' interest in existing residences, newly built houses and distressed property for sale has been declining within the range of 14 to 23% every month. Because contract closings are at least one month behind the actual signing of purchase contracts, analysts stated that sales figures will continue to decline in the next two months when compared with previous year's levels.
In terms of home prices, June figures showed the city recording its third consecutive price increase. June data showed prices of existing homes and distressed properties for sale in Chicago rising by 4.3%. However, prices are still believed to be about 12% behind analysts' projected price trend and further price declines are expected now that housing sales have started to drop.
When it comes to foreclosure activities, the city recorded a 60% rise for August 2010 when compared with the same period of 2009. August figures also showed that 40% of total home sales in the city were accounted for by distressed properties or short sales. Analysts stated that this means that the small number of homebuyers willing to take the plunge is only interested in bargain properties.
Meanwhile, unemployment rates in the city for July are reportedly down, with the Bureau of Labor Statistics revealing increased employment numbers for the area for the sixth consecutive month. Employment in Chicago rose by 3% when compared with the 14-year record low posted in January.
Despite the high number of distressed properties for sale in Chicago, analysts are predicting a stronger housing market for the city in the long term. The optimism is buoyed mainly by improved employment conditions.
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