Chicago Home Sales Still Slack In January

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Chicago housing sales in January dropped by nearly 11 percent from the year before, according to data released on February 27th by the Illinois Association of Realtors. This is the 10th consecutive month of falling sales, although prices edged upward by 2.2 percent.

Another report, this one from the National Association of Realtors, showed a 4.3 percent decline in year-over-year sales nationally. It also noted the sixth straight month of declines in the median price of existing homes, which dipped another 3.1 percent last month. The glut in housing inventory in some areas was beginning to scale back, according to the report. However, with new listings hitting the MLS as the “spring selling season” approaches reset January’s inventory back at December levels—a 6.6-months’ supply. The supply hit its peak at 7.4 months in October, the NAR said.

Economist Mike Larson said the inventory problem is far from resolved.

“Inventory has come down [since last year], and a lot was made of that,” said Larson, who tracks housing for Weiss Research in Jupiter, Fla. “But frankly, if you look at historical data, that happens just about every year.

“Inventories are climbing again because of what I call ‘the march of the relisters,’” Larson said. Sellers whose homes failed to sell in spring and summer took them off the market around Thanksgiving and are now relisting them, he explained.

“I expect the inventory numbers to continue rising in February, March and April, and we may very well set a new high,” Larson added.

The NAR report also showed that housing sales in the Midwest overall stayed steady, with sales rising by under 1 percent from January 2006, though the median price fell by 3.5 percent. The biggest Chicago-area decline was in Grundy County, where home sales sagged more than 15 percent. On the other end of the scale, DeKalb County sales spiked by 33 percent, though median prices fell by 11 percent, according to the Illinois Realtors.

Condo sales in the Chicago area dropped by 3.4 percent, but prices simultaneously rose by 3 percent. Cook County condo prices went up 6.4 percent year over year—the best appreciation rate in the region.