Chicago Home Prices Rose at 2x National Rate

by | Dec 10, 2024

In October, the median price of homes sold in Chicago proper during the month was up 8.6% from the same time in 2023, according to data released Nov. 21 by the Illinois Realtors Association.

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That’s more than twice the price growth the nation saw last month. The median price of all homes sold nationwide in October was up 4% from the year before, according to data released on the same day by the National Association of Realtors.

Prices for the broader Chicago area are also growing far faster than the nation’s. In the nine-county metro area, the median price of homes sold in October was up 7.6% from October 2023.

That’s 2 months in a row of Chicago prices doubling the nation’s, showing a clear pattern that might be here to stay.

Prices Slowed Nationwide But Not Here

In each month since March, nationwide home price growth has been a little less than the one before, according to the S&P CoreLogic Case-Shiller Indices
 
But in Chicago, the decline hasn’t been as steady, or as severe. For the four months June to September, the index shows price growth in Chicago around 7%. The latest figure, for September, was 6.9%.
 

Price growth is easing off here — the 6.9% is 2 full percentage points off February, the peak of 2024. Again, it’s not as big a drop as the nation’s, which went from 6.5% price growth in February to 3.9% in September, or a decline of 2.6 percentage points.

The index shows bigger Chicago-area price growth in September than in 17 of the 20 largest U.S. metro areas. The only two with bigger price growth in September were New York (up 7.5%) and Cleveland (up 7.1%). Of the 20 cities, 13 had price growth of less than 5% in September.

October 2024 Worst On Record For Buying a Home

The median price of homes sold in October in both the city and the larger metro area was higher than any October on record.

That doesn’t mean it was the most expensive month on record, as the seasonal cycle of our real estate market delivers higher median prices in the summer months.

The median price of homes sold in Chicago in October was $347,500, according to Illinois Realtors, and in the metro area it was $340,000. In both cases, they are the highest figure for October in records going back to 2008.

Slight Tick Upward in Sales

In Chicago, 1,688 homes sold in October, an increase of 3.1% from the same time last year. In the metro area, home sales were up 1.7% from a year ago, with 7,362 sales during October.

Despite the uptick in sales, 2024 still appears to be headed toward ending with fewer home sales than any year since 2011.

The Illinois Realtors data, which stretches back to 2007, shows that in both areas, sales were lower in October than in any other October besides 2023.

Inventory of New Subdivision Homes Lowest Since Last Century

Sales of newly built homes in the Chicago area dropped 5.8% in the third quarter of the year compared to the same time in 2023, according to data released by Tracy Cross & Associates, a consultant to the homebuilding industry based in Schaumburg.
 
There were 1,248 new homes sold, compared to 1,325 in the third quarter of 2023.
 
The cause is the low inventory of new homes to sell, as Erik Doersching, Tracy Cross’ CEO, has been explaining for the past several years. The number of available new homes for sale is at its lowest level in more than 25 years, the latest report says.
 
As expected, the median price of new homes sold in the third quarter was $537,525, according to the Cross data. That’s up 7.8% from the same period in 2023.
 
Tracy Cross anticipates the year closing as one of the strongest of the past 10 years, with a year-end sales volume in the range of 5,200. That’s based largely on the strong first half of the year, which has sales running 4.1% ahead of last year even with the declines of the third quarter.
 
2024 might end up as the second-strongest of the past 10 years for Chicago-area new home sales, behind only 2021, when the COVID-19-era homebuying resulted in 5,500 sales.

Sounds promising for the housing market?  Consider that in the early 2000s, annual sales of new construction homes topped 20,000 annually.

 

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