FOR IMMEDIATE RELEASE May 9, 2008
Contact: Mary Schaefer
217/529-2600

Illinois First Quarter Home Sales Hit by Credit, Economic Factors
Statewide First Quarter Median Price at $187,500 

SPRINGFIELD, Ill. – Illinois median home prices held their own in the first quarter while sales were constrained by the ongoing credit crunch and a softening economy. According to the Illinois Association of REALTORS (IAR) first quarter report, total home sales (which include single-family homes and condominiums) totaled 21,576, down 27.0 percent from 29,553 home sales in the first quarter of 2007. The first quarter median home sale price was $187,500, down 4.3 percent from $196,000 a year earlier. The median is a typical market price where half the homes sold for more, half sold for less. The average sale price was $252,899, up 0.9 percent from $250,576 for the same period a year ago.

“Extreme winter weather on top of shaky consumer confidence due to rising gas and food prices and the uncertain economy affected overall home sales activity statewide. REALTORS do anticipate a boost in activity as we enter the spring housing market from pent-up demand held over for so many months,” said REALTOR Kay Wirth, president of the Illinois Association of REALTORS. “The fundamental elements of a solid housing market are in place with low interest rates and ample inventory of homes. REALTORS around the state report more interest from buyers at showings who waited out last fall and are ready to buy for long-term value.”

In the city of Chicago the median price of a home increased 5.4 percent in the first quarter to $295,000 compared to $280,000 in the first quarter of 2007. Total home sales (single-family and condominiums) reached 4,618 sales in the first quarter, off 19.9 percent from 5,768 homes sold in the first quarter of 2007.

“In an economy where housing markets are fluctuating nationally, the value of homes in the city of Chicago continues to steadily increase, underscoring our message that now’s the ideal time to buy,” said David Hanna, president-elect of the Chicago Association of REALTORS. “We continue to see steady growth in the median price of home sales in Chicago and particularly strong increases in the median price of condominiums, up 8.6 percent this quarter.”

The first-quarter commitment rate for a 30-year, fixed-rate mortgage for the North Central Region averaged 5.91 percent, according to the Federal Home Loan Mortgage Corporation. It was down from 6.27 percent in the fourth quarter of 2007 and 6.24 percent in the first quarter of 2007.

In the Chicagoland Primary Metropolitan Statistical Area (PMSA), total home sales (including single-family and condominiums) were down 29.9 percent in the first quarter to 13,989, compared to 19,942 home sales in the first quarter of 2007. The median home sale price in the Chicagoland PMSA was off a slight 0.6 percent to $243,500 in the first quarter of 2008 compared to $244,900 in the same period one year ago.

A sample of counties around the state that saw median home sale price increases in the first quarter include Cook County, up 1.4 percent to $258,500; Bureau, up 11.3 percent to $93,500; Champaign, up 2.3 percent to $144,500; Jo Davies, up 5.4 percent to $170,000; McLean, up 5.2 percent to $152,750; Peoria, up 12.3 percent to $112,250; Sangamon, up 9.3 percent to $114,750; and Tazewell, up 3.3 percent to $120,000.

“The central region of the state really showed its resiliency in this difficult first quarter with price gains reported in Champaign, Peoria, Sangamon and McLean counties despite weather and economic factors,” said Wirth, a broker with Re/Max Unlimited Northwest in Crystal Lake.

“The Illinois economy appears to be reflecting the weakened national economy after two months of strong employment growth however, in contrast to many metropolitan areas, the declines in median house prices in Chicago have been very much smaller than the double-digit declines recorded in many parts of California and Florida,” said Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois. “As we look into the future there appears to be continued uncertainty about the true health of the national economy as a combination of record high oil prices and the continuing uncertainties about the housing market are probably going to spillover into continued employment losses.”

Adds Hewings: “If past history is any guide, Illinois is likely to experience several months of declining economic performance since the state usually lags national economic trends anywhere from three to six months.”

According to the latest forecast from the National Association of REALTORS, chief economist Lawrence Yun said: “With an anticipated pickup in home sales (or a guaranteed pickup in home sales with a home buyer tax credit) in the second half of the year, the economy will also begin to grow. The combination of the recently enacted fiscal stimulus package and the usual lagged impact of monetary policy decisions will further help jump-start the economy in the second half of 2008. That should help stem the tide of any incoming ‘formal’ recession.”

Condominiums

First quarter condo sales across the state were down 29.0 percent to 6,692 condos sold compared to 9,431 units sold in the same period for 2007. The median price for a condominium in Illinois in the first quarter of 2008 was $224,900, up 4.6 percent from $215,000 a year ago.

In the Chicago PMSA, condo sales were down 30.3 percent to 6,311 units sold during the first quarter of 2008, compared to 9,051 condo sales in first quarter 2007. The first quarter condo median price was $233,500, up 6.6 percent from $219,000 in the first quarter of 2007.

Sales and price information is generated from a survey of Multiple Listing Service sales reported by 35 participating Illinois REALTOR local boards and associations. The Chicagoland PMSA, as defined by the U.S. Census Bureau, includes the counties of Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will.

The Illinois Association of REALTORS is a voluntary trade association whose 60,000 members are engaged in all facets of the real estate industry. In addition to serving the professional needs of its members, the Illinois Association of REALTORS works to protect the rights of private property owners in the state by recommending and promoting legislation that safeguards and advances the interest of real property ownership.

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