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The Home Front
Like a fresh breath of spring, home sales on Chicago’s North Side rebounded in April, spinning out of a three-month nosedive.

3-Jun-24 – Combined April 2024 existing home sales volume for Lakeview, Lincoln Park, Near North Side, and North Center increased by 13.4 percent, according to the May 2024 Market Analysis for Chicago’s North Side, co-authored by Realtors John Irwin and Jackie Lafferty of Baird & Warner.

John Irwin and Jackie Lafferty

“All of our comparative market analysis categories had positive results for April, but varied by neighborhood and price point,” noted Irwin (left in photo).

“While the local and national economic news continues to vary almost weekly, the market seems to be moving in the right direction,” Irwin said.

A recent easing of 30-year fixed mortgage rates below 7 percent obviously is helping buyers stay in the game.

On May 23, Freddie Mac’s Primary Mortgage Market Survey reported that 30-year fixed-rate home loans nationwide averaged 6.94 percent, down from 7.02 percent a week earlier. A year ago, those fixed loans averaged 6.57 percent.

Freddie Mac

“Spring home buyers received an unexpected windfall...as benchmark 30-year mortgage rates fell below the 7 percent threshold for the first time in more than a month,” said Sam Khater, Freddie Mac’s Chief Economist. “Total inventory of both new and previously owned existing homes is up. Greater supply coupled with the recent downward trend in rates is an encouraging sign for the housing market.”

Freddie Mac also reported that 15-year fixed loans averaged 6.24 percent, down from 6.28 percent a week earlier. A year ago, 15-year mortgages averaged 5.97 percent.

The Freddie Mac survey is focused on conventional, conforming, fully amortizing home purchase loans for borrowers who place a 20 percent down payment and have excellent credit.

Baird & Warner’s May market analysis detailed the following real estate comparatives in the four neighborhood areas.

Home sales. April’s home sales volume results were driven by a 41.5 percent increase on the Near North Side. Lakeview and North Center had single-digit increases, while Lincoln Park reported a 10.1 percent decrease.

Sales also increased in homes priced under $1 million and over $2 million. However, sales of homes priced between $1 million and $2 million dropped 13.5 percent.

Home prices. Median home prices in April 2024 rose by 17.5 percent in three of the four neighborhoods. The increases ranged from 6 percent for Near North to 21.6 percent for North Center. Lincoln Park was the only neighborhood to report a decrease in home prices – of 4.3 percent.

April home prices varied by price point. There was no change in homes priced under $500,000, while homes priced between $500,000 and $1 million increased 3.8 percent. Homes prices between $1 million and $2 million dropped 5 percent. Homes priced above $2 million declined 4.2 percent.

“Traditionally, low inventory levels significantly drive up prices, but this has not been the case on Chicago’s North Side,” Irwin noted. “While year-to-date prices have risen 9.4 percent, they are lower than the Chicago suburbs and many cities across the country.”

Photo provided by Don DeBat

Despite low inventory levels, buyers are still very price conscious and would rather wait for new homes to come on the market than overpay because of low inventory levels, Irwin said.

“Pricing must reflect the true value of the home,” he said.

Under contract. Homes that went under contract in April 2024 increased 31.8 percent and were driven by the Near North Side and North Center. Lincoln Park and Lakeview both reported decreases.

Listings. Inventory levels dropped an additional 6.9 percent in April 2024 versus April 2023, but this did not have the negative effect on home sales that we saw in March.

Adobe Stock

The April listing decreases varied by neighborhood with Near North Side dropping only 1 percent and Lakeview dropping by 23.7 percent.

Looking at inventory levels by price point, homes listed under $500,000 reported a 5.7 percent increase, while homes priced over $500,000 had decreases.

Strong buyer demand. Showing requests and attendance at open houses in the past three months remain strong. Many buyers are looking for homes in “turnkey” condition.

“Updated kitchens, bathrooms, flooring and paint colors are very important, as many buyers do not want to do the updates themselves,” Irwin said. “Sellers should consider the needed renovations before they list their homes.”

Gazing into Baird & Warner’s crystal ball, Irwin said: “The market is improving but there are many twists and turns. Buyers and sellers should do their homework before moving forward.”

A couple of years ago, during the pandemic, experts said the market was “crickets.” It was dead. Now, maybe it is starting to jump like cicadas.