The Chicago metro area saw a strengthening in its housing market in 2016, according to a year-end analysis by real estate agent organization RE/MAX.
Home sales in the Chicago area totaled 114,569 units for the year, an increase of 4.5% from 2015 and the most sold in any year since 2006’s 117,503 units. However, sales did see a slow-down in the second half of the year, increasing only 2%.
The median home sales price also saw an increase of 6.6% in 2016 to $225,000. The pace of home sales also increased significantly to 88 days, down from 2015’s 93 days.
However, inventory continues to be a problem in the area. At the end of December, housing inventory stood at a 2.8-month supply based on the average pace of sales in 2016.
“The metro Chicago market has faced this problem since 2013,” said Jack Kreider, executive vice president and regional director of RE/MAX Northern Illinois. “At the end of 2012 we had a 4.7-month supply of homes based on the pace of sales that year.”
“By the end of 2013 there was just a 3.2-month supply, and now our supply is even lower,” Kreider said. “It’s somewhat surprising given that the median sales price of a Chicago-area home was 40% higher this year than in 2012. You would think a price increase of such magnitude would attract a larger pool of homes into the market, but that hasn’t happened yet.”
The number of foreclosures and short sales also saw a decrease in 2016. Distressed homes decreased to 15.3%, down from 21.5% in 2015.
Chicago wasn’t the only city that saw significant increases in home sales during 2016. San Antonio, Texas also saw a record-setting year for its housing market in 2016.