Surprising Chicago Home Buying Activity In December

With the original home buyer tax credit scheduled to expire at the end of November I fully expected December to really be a slow month in Chicago. My assumption was that a significant amount of housing demand had been pulled forward, not leaving much for subsequent months.

However, when I recently checked new real estate contract activity for December I was blown away by how strong it was.

December Home Contracts Chicago

Contracts in December for Single Family Homes and Condos/Townhouses in Chicago were up 95% and 105% respectively over 2008.

Of course, I was curious as to whether or not certain price ranges had disproportionately been affected so I looked at the price distribution of these contracts.

December Single Family Home Price Distribution

As you might expect, the 2009 contracts for single family homes were skewed more towards the sub-$200K price range than in 2008 but, nevertheless, some activity above $200K was still stronger than in 2008. However, the big surprise was the amount of activity below $100K – both in 2008 and 2009. The 47% numbers reported above are not an error. I had never looked at that price range before and was shocked at how many single family homes sell in this price range – some as low as $10K. Of course, these are really scary looking properties and I’m not even sure they are habitable.

The story for condos/townhomes is pretty much the same.

December Chicago condo contract distribution

In 2009 condo contracts also skewed more towards the sub-$200K range but again activity above $200K was still substantially higher than in 2008.

This is further evidence that the market in Chicago is coming back strong. Granted, the tax credit has been extended, but I would have expected that to have already run its course by the end of November.

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