In 2016, real estate broker Jacqueline Lechner – and others like her – detected something in the housing market that had been missing for quite a while.
“There’s an energy, a real vibe now,” says Lechner, a broker with Berkshire Hathaway HomeServices Starck Real Estate and president of the Heartland Realtor Organization – McHenry County’s Woodstock-based association of Realtors. “People are actually excited about housing again.”
The housing market in McHenry County and elsewhere in the Chicago area has quietly rebounded to levels of activity not seen since just before the market crash at the onset of, what many now know as, the Great Recession.
According to data supplied by the Springfield-based Illinois Association of Realtors, 2016 witnessed a resurgence of home buying and selling activity on par with what the region experienced in 2006 at the tail end of the last housing boom.
Ten years ago, in the moments before the market began to slide into recession, 4,913 homes sold in McHenry County and 116,527 homes sold in 2006 in the nine-county region known in the real estate business as the Chicagoland Primary Metropolitan Statistical Area. The PMSA includes the counties of Cook, DuPage, Kane, McHenry, Lake, Will, DeKalb, Kendall and Grundy.
And, in 2006, those homes were fetching a median price – the statistical price at which exactly half of the homes sell for more, and half for less – of $229,500 in McHenry County, and $248,000 in the Chicagoland PMSA.
By 2010, however, market activity had tanked, with home sales in the region dropping by 40 to 45 percent or more, and the median home prices falling by 25 percent or more.
In 2016, seemingly without much fanfare, local real estate metrics indicated the market appeared to be on its way back to health.
In McHenry County, through Nov. 30, 2016 – the most recent date for which the local numbers were available – the Illinois Association of Realtors reported 5,184 homes sold in the county, while single-family dwellings fetched a median price of $214,500.
In the Chicago region – in all of 2016 – there were 114,150 single-family homes sold with a median single-family home price of $188,000, the IAR states.
“For the first time in a long time, I see hope for both buyers and sellers,” says Lechner. “People were waiting for this.”
Jim Haisler, executive director at the Heartland Realtors group, noted that one of the main factors holding the market back at this point is – simply – a lack of inventory, particularly as it compares to demand for homes.
Haisler speculates that some would-be home sellers perhaps lack the equity on their home mortgages needed to profit from a sale, while others may lack solid enough employment prospects to seek a larger home or more desirable locale. Others may simply remain skittish about a market that brought pain for much of the past decade.
But he and Lechner both note that home prices are rising, and are expected to continue edging up throughout 2017 as the market remains “warm to hot,” as Haisler put it; and as homeowners decide to sell, they may find themselves in a position to negotiate against multiple offers, Lechner says.
The IAR has forecasted median prices to increase from 3.8 to 8.4 percent in the Chicago PMSA in 2017, while sales activity could jump by as much as 9 percent, states the association.
“We just need some sellers to get into the market,” Haisler says.
Lechner also notes that home foreclosures have plunged in the region, and nationally, in recent months, setting the stage for a renewed push for something not seen for a while in McHenry County and other formerly booming areas of Illinois – new home construction.
The new construction is “happening everywhere” in the county, says Lechner. However, she cautions that the surge will not begin uniformly, as some communities – and even some sections of communities, or “micro-markets” – could lag behind others.
A recovery, a long-awaited moment by many, appears to be entering full swing. And with interest rates remaining historically low, those who have contemplated making a move to a better house or those seeking to enter the housing market, this is good news, she says.
“It’s the time to make that move,” Lechner says.