August 2016 Home Prices and Sales

The Illinois Association of Realtors (IAR) reported that year over year residential sales in the city of Chicago increased by 2.6%, with 2,770 sales in August 2016 compared to 2,701 sales in August 2015. The median sale price increased by 1.5% ($275,000 in August 2016 compared to $271,000 in August 2015). Homes in the city of Chicago were on the market an average of 39 days, down from 45 days last August.

Dan Wagner, president of the Chicago Association of REALTORS® and senior vice president for government relations at Inland Real Estate, noted that a surge in late-summer buying “lifted sales to positive annual gains.” However, “inventories in the city of Chicago saw a notable 14.7 percent decline, making August the fifth month in a row where we’ve seen double-digit percentage decreases in the number of homes for sale.”

The following charts summarize median price and sales trends:

The University of Illinois Regional Economics Applications Laboratory estimates positive growth in Chicago area* annual sales levels for September, October and November 2016, with average changes expected to increase by 8.0% to 10.8% compared to last year. Other notes from the forecast report include:

• Median prices in the Chicago area are estimated to post year-over-year gains of +2.5% in September, +1.8% in October and +1.6% in November.
• In August 2016, at the previous 12 month average sales rate, the Chicago area had enough housing inventory for 3.5 months (down from 4.5 months a year ago). Months of supply for homes in all price ranges except $700K+ declined in both Illinois and the Chicago area.
• The pending home sales index, a leading indicator based on contract signings, was 203.6 in August (100=average pending sales in 2008). The number of homes put under contract in the Chicago area was up 16.5% from August 2015.

Chaired by Mayor Rahm Emanuel, World Business Chicago is the public-private partnership leading the Plan for Economic Growth and Jobs in order to drive business development, cultivate talent, and put Chicago at the forefront of the global economy.

WBC’s “Economic Briefs” track indicators from month to month to gauge the strength of several aspects of Chicago’s economy, including unemployment, population, venture capital, job openings and new hires, home sales, tourism, etc. This data provides a clear analytic framework for specific Plan strategies and initiatives. For a summary of these and other economic indicators, refer to WBC’s monthly Chicago By The Numbers.