California Home Prices Rise for Third Straight Month - Any Relevance to Chicago?
CA MEDIAN PRICES INCREASE 4.2% IN MAY VERSUS APRIL - BUT STILL NEARLY 31% DOWN FROM MAY, 2008!
According to many Real Estate Experts, what happened to the Real Estate Market across the state of California foretold the downward spiral of home prices, and overall home sales, across the country.
Now, however, California Home Sales appear to have turned a corner. In May, the Median Sales Price of a CA home increased to $267,570 - up over 4% from April, according to the California Association of Realtors, as reported in today's Wall Street Journal by Reporter Stu Woo.
The California Inventory of Unsold Homes also continues to fall. Today, experts calculate a 4.2 month supply of homes unsold, versus 5.6 months supply in April, and 8.7 months of supply in May, 2008. However, the Realtor Association calculates median home prices are still 30.4% lower than they were this time last year.
Will this CA turnaround predict a similar turnaround in the Chicago Real Estate Market?
Here in Chicago, in the North and Northwest Side Neighborhoods our Team serves frequently, average home prices have see-sawed the last few months between $250,000 and $295,000 - considerably below the mid-$300's average of mid-2006. Inventory levels of homes for sale still stands at over 15 months in these same neighborhoods - although it pushed the scary 19+ month level as recently as six months ago - and, at 15 months, is still, by any reasonable assessment - very high!
Track Chicago Real Estate Trends and Stats via our Chicago IL Stats Pack Archives via our Chicago Real Estate Blog, BlogChicagoHomes.com.
Back to the California numbers, some feel that one of the reasons for the turnaround in median prices is the fewer foreclosed properties, with their heavily-discounted market prices, currently headed to market. But CA prognosticators are wary, as the state has a very-high 11.5% Statewide Unemployment Rate (IL, by comparison, had an Unemployment Rate of a still high 10.1% in May). The state may need to trim up to $10 Billion of state spending, and the resultant loss in jobs, to partially close a massive, $24 Billion budget shortfall.
Across California, over 556,500 homes were sold in May - up 35.2% from May of last year. Sales in many Chicago Neighborhoods, especially those closer to Downtown Chicago and The Loop, is also surging - especially in areas with high concentrations of young professionals, many of whom do not need to sell their current home or condo in order to buy a new one.
The decision to buy - a smart one right now? Perhaps, if, as many feel, median prices are nearing a possible bottom.
DEAN MOSS & DEAN'S TEAM CHICAGO
