Illinois and Chicago Real Estate Sales Rise

October 20, 2011

It’s as if the housing market took a time out from reality: After months of negative reports and bleak outlooks, this week has been filled with positive news, including a rise in builder confidence and a spike in housing starts.

Now, the good news continues on the Illinois and metro Chicago real estate scene with the Illinois Association of REALTORS latest report, which states that existing-home sales in the nine-county Chicago metropolitan area rose 13.3 percent in September compared to the same time last year.

boy hugging dad with a sold sign behind themStatewide, year-over-year home sales increased 13.5 percent last month, and in the city of Chicago, the increase in home sales from September 2010 to September 2011 was 6.8 percent.

“Home sales are up significantly from last year and that’s a welcome signal for the Illinois housing market,” said REALTOR® Loretta Alonzo, CRB, GRI, president of the Illinois Association of REALTORS®. “Still we would expect to see even more people taking advantage of these excellent affordability conditions with low mortgage interest rates.”

Sadly, it seems that lenders are the ones slowing progression.

While the National Association of REALTORS reported that U.S. home sales in September were 11.3 percent above the September 2010 pace, contract failures were also reported by 18 percent of association members last month. That compares to 9 percent during the same month last year.

Contract failures are cancellations caused by such things as declined mortgage applications, appraisals coming in below the negotiated price, problems with home inspections and employment losses.

“Existing-home sales have bounced around this year, staying relatively close to the current level in most months,” said Lawrence Yun, NAR chief economist. “The irony is affordability conditions have improved to historic highs and more creditworthy borrowers are trying to purchase homes, but the share of contract failures is double the level of September 2010.

“Even so, the volume of successful buyers is higher than a year ago and is remaining fairly stable — this speaks to an unfulfilled demand.”

Let’s hope that demand begins to be fulfilled and that the good news continues.

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