Bidding wars are back in popular neighborhoods as Chicago area home buyers compete for limited inventory. Available housing inventory in February 2023 totaled 17,684 homes for sale, representing a drop of 11.4% from February 2022. As of March 2023, home inventory started to rise, but so did home prices!
The median listing price of a Chicago area single-family home is about $340,000. Home buyers who were hoping to catch a break after last year’s frenzy haven’t found many bargains. Unless the inventory of homes for sale picks up soon, buyers will face tight market conditions in the months ahead.
Nationally, there is some softening in home prices, due in part to higher mortgage rates eroding buyer purchase power. But here in the Chicago area, prices grew at a modest pace compared to “hot” markets elsewhere, which keeps our homes relatively affordable. With less speculation in the market, there is more stability to home values, as well.
Yet there are varying trends around Chicago. Condominiums in the city are still plentiful. And not all single-family homes fly off the shelf when they hit the market. Chicago area home buyers are motivated, but as we said in a prior blog, they are not desperate. One of the good things to come out of higher interest rates, is the fact that buyers are more thoughtful today than in recent years. Homes that draw a crowd can command multiple offers, but homes that need work, or have location issues, will take more time to sell.
Meanwhile, there is no easy solution for getting more inventory to market. Higher rates are discouraging some homeowners from selling; many of them locked in rates around 4% or less in recent years. It’s harder to change homes when a new place means a more expensive mortgage. And because home inventory has been low for so long, it will take time to get back to “normal.”
Home buyers, keep your mortgage pre-approval updated as interest rates change! Know what you can reasonably afford under different interest rate scenarios. Stay active in the home search process, and contact StartingPoint Realty to get a Chicago home buying expert on your side!
StartingPoint Realty – helping home buyers since 2004!
StartingPoint Realty proudly serves home buyers throughout the entire Chicago area. Get an introduction to home buying by attending our free home buying seminar! There’s no sales pressure and no obligation. We can also refer you to top mortgage lenders in Chicagoland – just ask!
Always feel welcome to contact us with your Chicago real estate questions!
Ryan Gable Broker/CEO Starting Point Realty
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