Evanston Illinois and Chicago real estate listings, home buying, selling and relocation information

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Market Analysis: March, 2012

2012 will go down as the year that things settled back to "normal". That is, assuming nothing else goes sideways in the world. Yes, it's an election year and that is always an economic booster, but most experts (including little old me) agree that we've found the bottom, we've been skating on it, and things should improve, however slowly and methodically, from here.

As you'll remember from last month's installment, January was a damn fine month in the world of Evanston real estate. February was an improvement on January, but by a MUCH wider margin for houses than single family homes. In fact, February saw a huge increase in the number of single family home contracts over January (more than doubling from 19 to 41), and that represented a similar increase from Feb 2011, where 21 houses went under contract. And the even better news is that all of those sales did NOT cluster at the entry level. In fact, 15 of those fell between $500,000 and $800,000, which is a nice change, but there remains was a gap in the $1m-$1.5m range still, with only two sales in February (though that began to pick up in March). Absorption rates for houses average around 4months for most price points except for the $900k-$1m range (8 months) and then it falls again to about 6 months for the $1m-$1.5m range before skyrocketing yet again for the luxury zone.

Condos are seeing a far more moderate improvement than houses from January to February (up from 27 to 36), although that number is still lower than February 2011 (39). Still, even with minor fluctuation, the condo market is finally enjoying far healthier inventory levels and the additions to new inventory each month are FAR lower than 2011 while cancels/expireds remain similar. Overall, this is leading to an absorption rate of 8-10 months for almost all condo price points except for the obnoxiously oversupplied $450,000 to $500,000 range and of course the luxury end. With any luck, absorption rates will trend further down with the spring market and it's entirely possible that we find ourselves back in the "normal" zone of about six months of inventory before the summer hits!

Market times converged yet again for both contracted condos and single family homes at right around 190 days, trending down in both cases but more dramatically for condos.

Overall many signs are encouraging stability in the real estate market. As Tiffany suggests in the Financial Corner, mortgage modification SHOULD be getting easier to secure for homeowners who find themselves underwater though I for one am not holding my breath until I see the rubber hit the road. I am not convinced that the broken system of loan servicing has been amended enough to keep servicers from focusing on the almighty profit line instead of what's best for the investors or the homeowner. If any of you is successful in a loan modification, I would LOVE to hear from you! Still, mortgage restrictions continue to ease, rates remain very low (with some fluctuation) and prices have never been lower, which is the perfect storm for buyers and sellers alike. Buy, buy, buy. And if you have something to sell, and are willing to be realistic, you are likely to accomplish your goal. Amen.