CRYSTAL LAKE – McHenry County's housing market continued to show signs of improvement last month with prices rising and inventory falling as U.S. home sales reached a 6½-year high in August.
Closed homes sales in McHenry County increased 29.3 percent to 521 in August, up from 403 in the same month in 2012, according to figures released Thursday by the Illinois Association of Realtors.
The median sales price for all properties in McHenry County rose 6.3 percent to $161,500 last month, up from $152,000 in August 2012. The median sales price for single-family homes increased 12.6 percent year over year to $192,000. Condo prices increased 17.5 percent to $102,250.
In August, the inventory of homes for sale dropped 26.2 percent to 2,166, down from 2,935 in August 2012. Homes also spent less time on the market. Last month, homes spent 81 days on the market until a sale, down 18.2 percent from 99 days in August 2012.
McHenry County homes sales were up 40.2 percent through the first eight months of the year, Year-to-date, closed sales totaled 3,391 through August, compared with 2,015 through August 2012. The year-over-year median sales price of all homes was up 5.2 percent to $152,500, from $145,000 during the same period last year.
The median sales price for all properties in Kane County was $174,500 in August, an increase of 16.4 percent from $149,900 in the same month last year. Year-over-year closed sales in Kane County were up 14.5 percent to 776, from 678 in August 2012. The median sales price for all properties in Lake County increased 16.1 percent to 220,551, up from $189,900 in August 2012. Closed sales were up 36.6 percent to 1,242, from 909 in August 2012.
Illinois home sales increased 17.3 percent over previous-year levels in August and median prices increased 13.6 percent, according to the Illinois Association of Realtors.
Statewide home sales (including single-family homes and condominiums) in August 2013 totaled 15,814 homes sold, up from 13,485 in August 2012. August marks one year of continuous annual sales and price gains.
The statewide median price in August was $167,000, up 13.6 percent from August 2012 when the median price was $147,000. The median is a typical market price where half the homes sold for more and half sold for less.
“The spring and summer selling season was quite strong, and the data suggest continued momentum into the fall,” Illinois Association of Realtors President Michael Oldenettel said. “A 13.6 percent median price gain in August for home prices in the state is an indicator of unflagging demand for homeownership.”
In the nine-county Chicago Primary Metropolitan Statistical Area (PMSA), home sales (single-family and condominiums) in August 2013 totaled 11,771 homes sold, up 24.3 percent from August 2012 sales of 9,471 homes.
The median price in August 2013 was $197,500 in the Chicago PMSA, up 16.2 percent from $170,000 in August 2012. The time it took to sell a home dropped substantially in August with listings averaging 59 days until sale, a 28.9 percent drop compared to 83 days in August 2012.
“Price and sales recovery continues and the forecast for the last quarter suggest that the momentum will be maintained,” Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory at the University of Illinois, said in a news release. “The price mix of homes sold is moving back to pre-recession levels as price increases move more homes into higher categories and as home buyers begin to seek more expensive properties. The sluggish economic recovery and increasing mortgage interest rates have not yet dampened housing demand.”
Fifty-two of the state's 102 counties reporting to IAR showed year-over-year home sales increases in August 2013. Forty-one counties showed year-over-year median price increases.
Nationally, home sales rose last month to the highest level since February 2007 as buyers rushed to close deals before interest rates increased further.
Sales of previously occupied homes rose 1.7 percent to a seasonally adjusted annual rate of 5.48 million in August, the National Association of Realtors said Thursday. That level is consistent with a healthy market.
August sales reflect contracts signed in June and July, when mortgage rates were rising steadily. The Realtors' group cautioned that buyer traffic dropped off significantly in August. That means sales could slow in the months ahead.
Higher rates will also likely depress sales next year, the Realtors' said. The group forecasts that sales will average 5.2 million in 2014.
Home prices rose as the supply of available homes remained tight. There were 2.25 million homes for sale last month, down 6 percent from a year earlier.
Steady job gains and low mortgage rates have fueled a recovery in housing since early last year. But rates have risen since May and have begun to restrain housing's rebound.
The average rate on a 30-year fixed mortgage was 4.57 percent last week, more than a full percentage point higher than in May. That's when Federal Reserve Chairman Ben Bernanke suggested that the Fed could soon scale back its $85-billion-a-month bond purchase program, which is intended to keep interest rates low.
On Wednesday, the Fed decided against reducing its purchases. It said one key reason for its decision was the sharp increase in mortgage and other interest rates. Pulling back on its bond purchases could have sent such rates even higher.
Many economists say the housing recovery should withstand the recent rate increase. Mortgage rates are still quite low by historical standards.
Last month, builders broke ground on the most single-family homes since February and sought the most permits to build those homes in more than five years.
Homebuilder confidence in September remained at its highest level in nearly eight years, according to a survey by the National Association of Home Builders. But builders are starting to worry that sales may slow in coming months if rates keep rising, the survey found.
The Associated Press contributed to this report.