After nearly a full year of home sales gains statewide, the rush to meet the homebuyer tax credit deadline combined with weak job and economic reports led to a lull in Illinois home sales activity in July.
According to the Illinois Association of REALTORS® latest report, statewide total home sales (which include single-family and condominiums) in July 2010 were down 29.7 percent, totaling 8,135 homes sold compared to July 2009 sales of 11,566 homes. The median price in July 2010 was $160,000, down 4.3 percent from $167,185 in July 2009. The median is a typical market price where half the homes sold for more, half sold for less.
Year-to-date sales remain in positive territory, up 15.0 percent January through July 2010 with 65,146 sales compared to 56,650 home sales for the same period in 2009. The year-to-date median sales price was off -0.9 percent to $155,000 from $156,330 for 2009.
We expected a lull in home sales after the expiration of the home buyer tax credit but not by this much. The tax credit did help us reduce the housing inventory, however.
“The underlying issue for stability in the housing market remains a healthy job market. We need some significant boosts in economic development, employment and consumer confidence to reduce foreclosures and create some equilibrium between supply and demand for housing. Slower sales and rising inventories will force more downward pressure on prices. The hangover from the expiration of the tax credit in April may extend into fall with forecasts for sales on an annual basis for the next three months indicating a continuation of the July experience,” said Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois.
“The anemic growth of private sector jobs is dampening chances for a more robust recovery. The expectation has to be that the slowing of the national economy will affect Illinois’ growth prospects over the remaining months of the year.” The unemployment rate nationally was unchanged in July at 9.5 percent; the Illinois unemployment rate lowered -0.1 point to 10.3 percent in July from the previous month. The monthly average commitment rate for a 30-year, fixed-rate mortgage for the North Central region was 4.58 percent in July 2010, down from 4.74 percent during the previous month, according to the Federal Home Loan Mortgage Corporation. Last year in July it averaged 5.52 percent.
"While it still remains a great time to buy, buyers are guarded as they consider their own financial stability and job security in the current market, hindering many from making a purchase.” According to the IAR report, total home sales (single-family and condominiums) comparing July 2010 to July 2009 were up in 16 of 100 Illinois counties reporting with 39 of 100 counties posting median price increases.
In our area, IAR reported gains in the median price for the month: Lake, up 13.3 percent to $238,000; McHenry, up 1.4 percent to $182,500. Sales and price information is generated from a survey of Multiple Listing Service sales reported by 37 participating Illinois REALTOR® local boards and associations. The Illinois Association of REALTORS® is a voluntary trade association whose 46,000 members are engaged in all facets of the real estate industry. In addition to serving the professional needs of its members, the Illinois Association of REALTORS® works to protect the rights of private property owners in the state by recommending and promoting legislation that safeguards and advances the interest of real property ownership.
Taken in part from Illinois Association of Realtors August 24th report.
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