I’m a Real Estate Agent: These 5 Illinois Cities Are About to Become Unaffordable
The real estate industry has been in flux for the past few years, making buying a home a challenge. While prices are stabilizing in some markets, certain cities in Illinois continue to be hot, and home prices are becoming unaffordable. If you’re thinking of buying a home in Illinois, it’s helpful to understand the state’s housing market and the five cities where home prices are increasing.
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The Current Illinois Housing Market
Mike Opyd, a top-producing RE/MAX Premier realtor in Chicago, explained that the housing market varies throughout the state. “In Chicago, we currently have a three-month supply of inventory (a healthy market is six), so we do not have a lot of inventory, but at the same time, there are even less buyers in the market,” he said. While such a situation would normally create a seller’s market, Opyd noted that most parts of Chicago are actually a buyer’s market. “That being said, sellers are still getting 98% of their original list price,” he said.
According to the RE/MAX June 2024 National Housing Report, there were 13,346 new listings in Chicago in June. That figure is down 2.1% compared to the previous month, though it’s 8.7% higher compared to a year ago. The area saw a $361,000 median sales price, which is up 3.2% higher than the median sales price in the previous month. That sales price is 8.2% higher than it was in June 2023. Overall, the data shows that Chicago homes are selling faster and for a higher price than they were in June 2023.
The situation is different in the suburbs around Chicago, where there’s only a two-month supply of inventory. The number of buyers in the suburbs is similar to the number of buyers in the city, but with fewer properties available, the suburbs are a seller’s market. “Sellers are getting 99.1% of the original list price in the suburbs,” said Opyd.
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Illinois Cities Where Homes Are Becoming Unaffordable
That low inventory is driving up prices around the Chicago area. Opyd identified five Illinois cities where prices are particularly high, often exceeding the $361,000 median sales price for the Chicago area: Park Ridge: According to United States Census Bureau 2022 American Community Survey 5-Year Estimates, 45.3% of Park Ridge homes are valued from $500,000 to $999,000, and 34.7% of homes are valued from $300,000 to $499,999.
Skokie
While the majority (48.5%) of Skokie Village homes are valued between $300,000 and $499,999, 16.7% of homes are valued between $500,000 and $999,999, and 1.2% are valued at $1,000,000 or more.
Niles
Half of the homes in Niles are valued between $300,000 and $499,999, and 13% of homes have values of $500,000 to $999,000.
Des Plaines
Home values in Des Plaines are high, too, with 45.7% of homes valued between $300,000 and $499,000 and 5.3% of homes valued between $500,000 and $999,999.
Mount Prospect
In Mount Prospect, 57.5% of homes are valued between $300,000 and $499,999, while 14.9% are valued between $500,000 and $999,999.
“Homeowners are still hesitant to sell, knowing that purchasing a new home would mean having to get a higher rate than they currently have,” he explained. “The few mid-priced homes available are selling quickly and often above asking price, creating a frustrating environment for many buyers.”
Tips for Buying an Illinois Home
Opyd said that if you’re thinking of buying an Illinois home in the next year or so, buy a home now before interest rates decrease. He anticipated that interest rates will start to come down this fall, as the Federal government is happy with where inflation is currently headed.
“When the rates come down, a lot more buyers are going to flood the market,” he explained. Though a buyer might get a better interest rate, the buyer will have to put in a higher offer to win a property because of the competition from other buyers. As a result, buyers could pay more for homes overall, so now may be the time to buy.
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This article originally appeared on GOBankingRates.com: I’m a Real Estate Agent: These 5 Illinois Cities Are About to Become Unaffordable