Twelve Communities That Might Be on the Rebound
Posted Mar 21, 2012 at 9:35 AM
Digging into the data from which we built the home-values charts in the April issue of Chicago, I’ve found a dozen city neighborhoods or suburbs showing signs that they’ve hit bottom and may be on the way back up.
Maybe! Possibly! No guarantees!
I’m including those disclaimers because we can’t say for sure what will happen over the next year. Another round of foreclosures may be waiting in the wings, the presidential election could impact consumer decisions, and the real-estate market has confounded expectations many times before. Zillow, for instance, is reporting today that the economists it surveys have lowered their expectations for the recovery they expect to begin in 2012.
Nevertheless, homes in these twelve Chicago-area communities sold more quickly and at higher prices in 2011 than they did in 2010. That bucks the norm in what was a dreary year: In more than two-thirds of the communities we chart, homes sold more slowly in 2011 than in 2010, and in about 85 percent of them, prices were down for the year.
As I said in this video, faster sales and higher prices are two key signs of strength in the residential real-estate market. A third is the number of foreclosures A report out earlier this week indicates that Illinois is nowhere near the end of its foreclosures.
Foreclosures have given, and they may also take away in Chatham, says Neal Gillie, an appraiser at Chatham Realty Services. Our data shows improved prices and market time for condos in that South Side neighborhood. Gillie attributes those upswings to an early round of foreclosures that were bought at rock-bottom prices, rehabbed, and resold at “greatly improved prices.”
But looking ahead, he says, “there are so many foreclosed properties here that have not been put on the market yet. When they do, it’s going to cause another plunge.”
Meanwhile, in Edison Park on the Northwest Side, our data shows single-family homes selling more quickly and at higher prices. What’s more, Ralph Milito, a Century 21 agent, says he doesn’t see a lot of new foreclosures on the horizon there. If he’s right, then Edison Park could be looking mighty strong this time next year.
Milito adds that the foreclosures of the past several years pulled the lower end of Edison Park’s prices way down. Since then, he says, those foreclosed houses have been “snapped up like crazy,” resulting in prices clicking upward.
Something similar is afoot in Inverness, according to Leonora Burkhart, a Re/Max agent who covers that affluent northwest suburb. In 2011, she says, the town had a “real strong middle,” with houses in the $600,000 range selling better than they had in a few years. That helps explain why our data shows faster and pricier sales of single-family homes in Inverness.
It may also explain a more recent phenomenon that Burkhart detected. In the past month, three homes priced at over $1 million have gone under contract, she says, something that hasn’t happened in a while. It’s the trickle-up effect: Buyers who finally get their homes sold can then buy a higher-end home.
Here are the 12 communities that appear to be on the way back up. The first column identifies the community, the second indicates the percentage price increase from 2010 to 2011, and the third column shows the 2011 market time as a percentage of the community’s 2010 market time. All data refers to the sale of single-family homes, except for Chatham and Grand Boulevard, where I’m looking at condo sales.
|Elk Grove Village|
Posted in Housing Bulletin