Chicago residential real estate price increases continue

But it deserves an asterisk: The figure reported at this time last year, during the first few months of COVID shutdowns, was almost flat, just 0.8 percent above the June 2019 figure. 

Nevertheless, the latest report marks a remarkable stretch of price acceleration. 

In the city, $351,500 was the median price of homes sold in June. That’s up 6.8 percent from June 2020 and is the smallest figure of any month of the current boom. City home prices have been up by double digits in eight of the past 11 months, including May, when prices were up 11.5 percent from a year earlier. 

Nationwide, home prices were up 23.4 percent from June 2020, according to data released separately this morning by the National Association of Realtors. 

A key reason for the big price increases is that in a tight-inventory market, buyers looking to make housing changes that suit their post-pandemic needs are having to bid up.

Geoffrey J.D. Hewings, emeritus director of the Regional Economics Applications Laboratory at the University of Illinois at Urbana-Champaign, said in the Illinois Realtors report that the inventory of homes for sale in Chicago in June was equal to 1.5 months’ sales and in the larger metro area, 1.7 months. Both are half the inventory level of a year ago, Hewings said. 

Nationwide, inventory is at 2.6 months, down from 3.9 months a year ago.  

The number of homes sold during the boom has also skyrocketed. 

Comparisons to June 2020 are warped because of that month’s timing during the crisis. Looking at the year-earlier period, June 2021 home sales were up almost 82 percent in Chicago and almost 53 percent in the metro area.

Instead, Crain’s compared June 2021 sales to the five-year average. In Chicago, 3,767 homes sold in June 2021, 27 percent more than the average number of homes sold that month in the previous five years. In the metro area, 15,402 homes sold last month, 20 percent more than the five-year June average.

Nationwide, home sales in June were up 22.9 percent from the same time a year ago, according to the National Association of Realtors. It did not provide sufficient data for a comparison to healthy pre-2020 years. 

Looking at the first half of 2021: Home sales in the first six months totaled 66,012 in the metro area, up 19.8 percent from the five-year average. In the city, 16,839 homes sold in the first half of the year, up 28 percent from the five-year average. 

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