Are Home Prices Going Up?
CEO of Compass, Robert Reffkin, believes the Real Estate Market may be on the Rise.
There are more Buyers than Sellers in the Market.
Chicago Real Estate Market Report - Q4 2022 The real estate market reacted to many factors during the pandemic and normalization continues. The primary macroeconomic factors affecting all markets include mortgage rates (trending lower at 6%), inflation (trending lower at 6.5%), personal savings rate (trending upwards at 3.4% but significantly lower than the 34% in April 2020), unemployment (3.4% - lowest since 1969), and geopolitical risks, e.g., Russia’s war on Ukraine. This is an especially difficult time to know which way markets are moving.
Real estate is hyper-local. Whether your values are increasing or decreasing depends exactly on your property’s condition and location. This is one of those times where my knowledge of the
market is paramount. Headlines are designed to drive readership - not necessarily to deliver news.
In 2022, the Chicagoland market saw a 19% decline in closed sales from 2021 on a 12 month rolling average - but sales reflected an increase of 6.25% from pre pandemic 2019. It is important to note that closed sales for Compass in Chicagoland fell less than 1% from 2021 levels. No one expected pandemic levels of activity to continue unabated - certainly not Compass brokers. Across Chicagoland, most communities logged a decline in closed sales of 20% - 30% on a year over year basis. In 2022, the Chicagoland market saw a 19% decline in closed sales from 2021 on a 12 month rolling average - but sales reflected an increase of 6.25% from pre pandemic 2019.
The story of no inventory continues throughout most of the Chicagoland communities.
Overall inventory was down 10% from last year but down 44% from 2019.
Overall, the median value of homes rose 5% on average across Chicagoland over the past year. Since 2019, values have risen 25%. Most but not all communities also saw an increase from 2019. For example, 2022 closed sales in Lincoln Park declined 19% from 2021, but were up 18% over 2019. Another example is Naperville which saw sales decline 28% from a year ago but a decline of just 5% from 2019. Evanston’s sales declined 17% from 2021 but were 6% higher than 2019. And if one were to narrow the search parameters further to specific blocks or elementary school districts, you
can extract even better data - something which I can provide you as part of my real estate consulting services whether you are buying, selling, investing or just curious about real estate. Read the full Chicagoland Market Report for Q4 2022 here.
Schedule your complimentary real estate consultation or call 312.961.4478 to get started.