In looking at the recent string of Case Shiller Chicago home price indices there has been a fairly rapid decline in our year over year price appreciation. So it is somewhat good news, with last week’s release of the November numbers by S&P Dow Jones Indices, that the decline seems to have stopped – at least for now. However, Chicago is still in the bottom quartile of metro areas for year over year price appreciation.
Single family home prices have risen 2.0% in the last year, while condo prices are up 1.4%. Both of those numbers are slightly better than they were for the October release. At least it’s the 25th month in a row of higher home prices from the previous year.
As is normal at this time of year, prices declined from the previous month. Single family home prices were down 1.1% from the October release and condo prices were down 0.7%. The current price levels correspond to where single family homes were in January/ February 2009 and April/ May 2003. Condos prices were last at these levels in January 2010 and then back in December 2002/ January 2003.
In total, single family home prices have fallen 23.9% since the peak while condos have fallen 20.3%. But at least single family home prices have recovered from the bottom by 24.9% with condo prices recovering by 32.0%.
And we don’t seem to be closing the gap with my long term trend line – still lagging it by 23.2%. That gap may actually be widening but it’s hard to judge at this time of year. If the gap doesn’t start closing in the next year or so I’ll have to reassess what a more “normal” price appreciation rate is for Chicago.
David Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices, sounded a rather pessimistic tone about the overall housing market and also about the market conditions in cities like Chicago:
Prospects for a home run in 2015 aren’t good. Strong price gains are limited to California, Florida, the Pacific Northwest, Denver, and Dallas. Most of the rest of the country is lagging the national index gains. Moreover, these price patterns have been in place since last spring. Existing home sales were lower in 2014 than 2013, confirming these trends.
Keep in mind though that, while total Chicago sales were down in 2014, sales of non-distressed properties in Chicago were actually higher.
#CaseShiller #Realestate #HomePrices
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