Illinois Home Sales Off 31 Percent

Blaming bad weather in January, the Illinois Association of Realtors said Monday that home sales volume fell in January, dropping 31.1 percent to 5,938 homes sold, compared to 8,618 homes sold in the same month one year earlier. Prices fell on an annual basis as well, with the median sales price dropping to $189,400 — off 5.3 percent from $199,897 in January 2007.

Despite the frozen housing market, realtors in the state were trying to stay positive.

“It’s been a challenging winter market given the severe snow and cold, but looking ahead to the spring market some positives to point to are low mortgage interest rates with 30-year fixed rates hovering around six percent plus a large selection of inventory to choose from,” said Kay Wirth, president of the Illinois realtors’ group.

“Recently-passed federal legislation that ups the loan limits for safe and secure loans from the Federal Housing Administration as well as Fannie Mae and Freddie Mac should give first-time buyers a boost as well.”

Given the low median prices in the state — well under the traditional $417,000 conforming loan limit — it’s unclear how higher conforming loan limits would be a boon to the states homebuyers. Most experts don’t expect the higher loan limits to apply broadly outside of states like California.

In the Chicago PMSA, total home sales were 3,926 in January 2008, down 34.0 percent from 5,947 home sales in the same month of 2007. The median home sale price for the Chicago PMSA was $239,700 in January 2008, down 2.2 percent from $245,000 in January 2007.

While the realtors continued to look for potential positives that lay ahead, statewide economists were perhaps more grounded in their assessment of what lies ahead for housing in Illinois.

“The sales forecasts for the months of January, February, and March 2008 suggest a continuing decrease in the sales decline for the state as a whole and a somewhat larger decline in Chicago comparing the forecast month with the same month in the previous year,” said Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois.

“Continued high oil prices and the consumers’ reluctance to spend — consumer sentiment is at a two-year low — provide sources of concern,” he said.

By Paul Jackson

Source Housing Wire

Net News Publisher

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