Local Business

Sales down, but county home prices up

CRYSTAL LAKE – The median sales price for McHenry County homes increased 15.4 percent to $150,000 in November, up from $130,000 during the same month last year, even as home sales tapered with fewer homes on the market.

Exisiting home sales in McHenry County fell 3.5 percent to 361, down from 374 in November 2012, according to figures released Thursday by the Illinois Association of Realtors. Though home sales slipped year-over-year in November, year-to-date closed sales remained significantly above 2012 levels. Through November, home sales were up 31.5 percent to 4,583, compared with 3,485 in the first 11 months of 2012.

The median sales price for single-family homes increased 17.3 percent to $176,000 in November. Condo prices increased 23 percent to $110,000. Year-to-date, the median sales price for all properties in McHenry County was up 8.5 percent to $153,000, compared with $141,000 in the first 11 months of 2012. Countywide, home prices remain well below 2008 levels.

In November, the inventory of homes for sale declined 25.3 percent to 1,893, down from 2,535 in November 2012. Homes also spent less time on the market. The number of days on the market until sale was down 18 percent to 73 days, compared with 89 days in November 2012.

In Kane County, the median sales price for all properties was up 16.7 percent to $160,500, up from $137,500 in November 2012. Homes sales increased 5.5 percent in November even though inventory fell 28.7 percent in Kane County.

In Lake County, the median sales price for all properties increased 6 percent to $167,500, compared with $158,000 in November 2012. Closed sales were down 1.5 percent as inventory fell 27.6 percent in Lake County.

Statewide, home sales slipped 1.8 percent to 10,624 homes sold, down from 10,820 in November 2012. Housing inventory in Illinois was down 19.7 percent from a year earlier, dropping from 77,109 homes for sale in November 2012 to 61,882 this year, according to the Illinois Association of Realtors.

"This is a classic case of supply and demand," Phil Chiles, president of the Illinois Association of Realtors, said in a news release. "The low number of homes on the market is forcing consumers, who very much want to buy, to pay a bit more. What's important to note is that there's still a lot of interest in purchasing a home despite the lower selection."

Statewide the median price in November was $145,000, an increase of 7.4 percent from November 2012 when the median price was $135,000.

The number of people who bought existing U.S. homes in November declined for the third straight month. Higher mortgage rates have made home-buying more expensive, while the lingering effect of the October government shutdown might have deterred some sales.

Home resales fell 4.3 percent to an annual rate of 4.90 million, the National Association of Realtors said Thursday. That was the weakest pace since December 2012 and the first time since April that the pace has slipped below 5 million.

Still, the Realtors' group predicts that total sales this year will be 5.1 million. That would be the strongest since 2007, when the housing bubble burst. But it's still below the 5.5 million generally associated with healthy housing markets.

Home sales could rebound in the new year if the strengthening job market lifts incomes and builds confidence in the economy.

Over the summer, re-sales reached a pace of 5.39 million, the fastest in four years. But sales began to slow in September as the costs of buying a home rose.

Mortgage rates are nearly a full percentage point higher than in the spring, when they were near record lows. And a limited supply of homes on the market has driven up prices. The combination has made home buying less affordable, particularly for first-timers.

Sales in November were 1.2 percent lower than in the same month a year ago, the first year-over-year decline in 29 months.

The Realtors' group said the main factor in the sales decline was less affordability. But it also cited fallout from the 16-day partial closure of the federal government, which might have delayed some sales.

The median sales price of an existing home was $196,300 in November. That was a slight decrease from October but 9.4 percent higher than a year ago.

Home-buying has declined 10.1 percent in Western states during the past 12 months. That drop has been partially offset by stronger sales in the Northeast and South.

The number of homes on the market in November fell 0.9 percent from October. But the supply has increased over the past 12 months. This could slow the rate of price increases because more homes would be available for sale.

There are signs that housing will strengthen next year. Builders broke ground on new homes last month at the fastest pace in more than five years. And builders' confidence in the market rose this month to match the highest level in eight years.

Mortgage rates have risen about a percentage point from historic lows earlier this year. The average rate on a 30-year fixed rate mortgage last week was 4.42 percent.

One concern is that first-time buyers accounted for just 28 percent of sales in November. That was down from 30 percent a year ago. In healthier housing markets, they typically make up at least 40 percent of buyers.

Many would-be buyers are struggling to qualify for loans, in part because banks have tightened standards and are requiring bigger down payments.

The market has received a boost from investors and all-cash buyers. Cash purchases made up 32 percent of transactions in November, up from 30 percent a year ago. Investors made up 19 percent of sales.

The Associated Press contributed to this report.

Loading more

Digital Access

Digital Access
Access nwherald.com from all your digital devices and receive breaking news and updates from around the area.

Home Delivery

Home Delivery
Local news, prep sports, Chicago sports, local and regional entertainment, business, home and lifestyle, food, classified and more! News you use every day! Daily, weekend and Sunday packages.

Text Alerts

Text Alerts
Stay connected to us wherever you are! Get breaking news updates along with other area information sent to you as a text message to your wireless device.

Email Newsletters

Email Newsletters
We'll deliver news & updates to your inbox. Plan your weekend and catch up on the news with our newsletters.