Chicago Real Estate Market Update: Home Sales Hit Another 8 Year High

I’m intentionally publishing my Chicago real estate market update one day later this month in an effort to better align my numbers with the Illinois Association of Realtors (IAR). Since their raw numbers have been slightly exceeding my estimates I think they may have switched to an 8th of the month snapshot. Let’s see how it goes.
It looks like April hit another 8 year high with an 8.0% gain over 2014 – nowhere near as strong as the performance that March turned in but still a healthy increase. So 2015 is starting out much stronger than 2014. In about 2 weeks I’m estimating that the IAR will report a 5.8% increase because of their slightly flawed methodology.
The graph below shows the historic trend back to 1997 with all the Aprils flagged in red.
Chicago monthly home sales

Chicago Home Contract Activity

The number of contracts being written – after adjustment for anticipated terminations – isn’t showing huge gains right now. April was only up about 4.1% from last year. However, January – March was pretty strong with double digit gains during that entire period. I think we’re reaping the benefit of that now. If May comes in like April we may see some weakening of the sales growth.
Chicago home sale contract activity

Pending Home Sales

Pending home sales are actually running higher than last year on an absolute basis but I prefer to look at them in terms of how many months of closings they can support. On that basis they’re running pretty much flat to last year with a 2.3 month supply. I started tracking this data in the graph below back in May 2012.
Chicago pending home sales

Distressed Home Sales

Distressed home sales as a percentage of total Chicago home sales just keeps hitting new record lows (since the housing bubble burst) and April was no exception. We are now down to 20.3% and, as I’ve been continually pointing out, the decline in distressed home sales is providing a significant drag on our total sales growth. For instance, non-distressed sales were up around 18.5% in April.
Chicago Distressed Home Sales

Chicago Home Inventory

Chandler Bing asks “Can it get any harder to buy a house?” Apparently the answer is yes. We just keep hitting new lows relative to the same time last year. The months supply of Condos and townhomes is down 9.8% from last year to only a 3.7 month supply. Meanwhile, the months supply of detached single family homes was down 16% to a 4.2 month supply. This is definitely a seller’s market and we are already seeing evidence in the Case Shiller home price numbers that prices are rising.
Chicago months supply home inventory

Chicago Home Sale Market Times

And as you would expect in a tight inventory market properties that sell are selling quickly, though the trend has flattened out. Condos and townomes that sell do so in only 84 days. Detached single family homes take a bit longer at 104 days.
Chicago home sale market times
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