A low supply of Chicago area homes for sale reduced home sale transactions in July, according to Crain’s Chicago Business. On a year-over-year basis, July home sales fell 4.9% across Chicago’s nine-county statistical area. This is the biggest decline since last summer’s 5.9% drop in home sales, which occurred during July 2016. The number of homes for sale during July 2017 fell 16.4% from a year earlier.
What this tells us, is that Chicagoland home supply hasn’t been keeping up with demand for the past two years, especially in entry-level price ranges sought by first-time home buyers. Strong home demand, amid low home inventory, has pressured home buyers and pushed up prices. The median price for a Chicago-area home reached $248,000, an increase of 4.8% from the same month a year ago. “Median” means that half of the homes sold for more than this amount, and half of them sold for less.
In the City of Chicago itself, home demand has also remained steady, while home inventory has been lean. Home prices in the Windy City reached a median of $301,000 during July 2017, an increase of 3.8% from the same period a year ago.
For first-time home buyers in Chicago and the Northwest suburbs, the combination of low inventory and rising home prices is a one-two punch, but it isn’t a knockout blow. To succeed in this market, home buyers should be willing to do these things:
- Expand home search to 2nd and 3rd choice markets.
- Consider “less than perfect homes” that need a little work, but are structurally sound.
- Review the “top and bottom” preference list – would a 2-bedroom home work as well as a 3 bedroom, to start? Is a 4-bedroom home affordable if you’re looking for 3? Stay within your budget, but think about ways you can expand your selection.
- Have a mortgage approval lined up, and have your earnest money and down payment ready! Keep your credit score in good shape.
- Stay in the home search process! At StartingPoint Realty, we’ll help with your home search, and notify you of new listings that meet your criteria!
- Be responsive to your agent, and be willing to look at homes on short notice. When you really like a home you’ve visited, make an offer!
StartingPoint Realty – guiding first-time Chicago home buyers!
StartingPoint Realty provides complete education and guidance to first-time home buyers throughout Chicago and the Northwest suburbs! Attend our free home buying seminar to learn about the home buying process. There’s never any sales pressure or obligation!
Check out our list of home buyer assistance programs on our website! You can also visit our Chicago Resource Center for neighborhood information and personalized assistance.
Always feel welcome to contact us for help with your Chicago home buying questions!
Ryan Gable Broker/CEO Starting Point Realty
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