Feb
10

Home Prices, Sales, Jobs Starting to Point to Recovery

February 10, 2011

Some stats to report on the national and Chicago real estate fronts that should give us a little hope for the future.

First, home prices.

According to the National Association of REALTORS, the national median existing single-family home price rose 0.2 percent in the fourth quarter of 2010 compared to the fourth quarter of 2009.

In Illinois, 43 of 98 counties reporting showed year-over-year median home price increases or no change.

“The fourth quarter for the city of Chicago shows true signs of stabilization and health returning to the marketplace, and performing without the temporary Federal Homebuyer Tax Credit, which expired in April 2010,” said Mabel Guzman, president of the Chicago Association of REALTORS®.

“The Chicago condo market during this period showed an increase in the average price of 4.7 percent, to $331,131, up from $316,163 during the same time in 2009. Single-family homes, respectively, increased in average price by 7.2 percent to $230,957 versus $215,527 from the same period in 2009.

“Additionally, closed median prices across the property types show signs of leveling in 2010 despite the presence of distressed assets throughout the city of Chicago.”

Next, home sales.

The NAR reported that existing home sales rebounded during the fourth quarter of 2010 in more than half of the country’s major metropolitan areas and rose 15.4 percent over third quarter’s numbers.

For the year, Illinois total home sales were down 3.8 percent compared to 2009, and in the Chicago area, home sales fell a mere 0.5 percent from the previous year.

“More than 53 percent of homebuyers were first-time buyers, according to the 2010 Profile of Illinois Home Buyers and Sellers, which is more than the national rate of 50 percent and significantly higher than the average since 2001 of 40 percent,” said Sheryl Grider Whitehurst, president of the Illinois Association of REALTORS®.

“The tax credit effect in year-over-year sales comparisons likely will continue in early 2011. Still, we’re seeing some positive signals from the economy, and improvements on the jobs front will help give people more confidence and release some pent-up demand for housing.”

Finally, onto unemployment.

Since we are discussing December, let’s start there.

The unemployment rate in the Chicago area in December fell to 8.6 percent; a significant difference from the 10.6 percent in December of 2009.

Back to the present: The amount of U.S. residents who filed new claims for unemployment benefits last week fell much more than expected.

According to the Labor Department, initial jobless claims dropped by 36,000 for the week ending February 5 to its lowest level since July 2008.

“An improving housing market and job growth will go hand in hand,” said Lawrence Yun, NAR chief economist. “The housing recovery will mean faster job growth.”

Yun anticipates that about 150,000 to 200,000 jobs will be added to the economy this year from an anticipated 300,000 additional home sales in 2011.

“Better than expected sales and/or strengthening in home values can have an even bigger job impact as consumer spending would naturally rise from a housing wealth recovery affecting a vast number of American families,” he said.

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Tracey

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[...] There’s a big job fair taking place this Tuesday at Soldier Field that you can attend without leaving your Chicago home. [...]

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