Are North Shore Home Sales Starting to Slip?

The National Association of Realtors (NAR) published an article this week titled: "Existing-Home Sales Slip 2.7% in March."

It does, of course, cover the national real estate scene. So there are inherently many facts that don't apply to Winnetka and the North Shore. One of the biggest is the title itself since the North Shore villages of Winnetka, Wilmette, Kenilworth, Glencoe, and Northfield (as a whole) saw sales dip by 21%!

Of course home sales have dipped - there are so few of them to buy! The good news - for sellers - is that the median price rose by 31%. 

Another way to see the rise in home prices is by total volume.

You can see that while many more homes sold in 2021, the dollar volume was higher in 2022 for fewer homes sold.

Laurence Yun, NAR's economist, is predicting home sales to drop 10% for the rest of the year and for home prices to readjust. Sorry, but I don't think that's going to happen on the North Shore this year.

With the number of multiple offers on homes, there are many buyers who have been disappointed. I met a woman at my open house this weekend who said she'd lost out on eight homes. The majority of the winning bids are all cash. 

The article also discusses the hike in mortgage rates which started the year just under 3% and have now topped 5%. Most buyers of North Shore homes will not be deterred by that increase and many will be paying cash regardless. 

But don't ignore the domino effect when considering the effect of mortgage rates. The first-time buyer could be shut out of the market. That means the next buyer up the ladder may not be able to sell his house as quickly or for as much. And so on. This residual effect might cause some troubles in the local market eventually.

And finally, most interesting is that we have reached a point where we are back to the housing inflation of 2007: