Chicago is maintaining its advantage in home price growth against the national average by a safe margin.
The median price for homes sold in the nine-county Chicago area rose to $339,900 in August, marking a 9.6 percent year-over-year increase, Crain’s reported, citing a study by Illinois Realtors. That’s the largest increase for the metro since July 2021, when prices soared by 12.3 percent during the height of the pandemic housing boom.
Nationwide, the median price jumped 3.9 percent to $407,100 compared to August 2022, according to a separate report from the National Association of Realtors. One year ago, prices were up 7.7 nationwide and 3.3 percent in Chicago, highlighting how much the market has since shifted in favor of cities where values didn’t skyrocket amid the health crisis only to come down more suddenly as interest rate hikes slowed transaction volume.
Within the city limits, prices rose 4.8 percent year-over-year in August to $330,000. That’s the largest jump since November 2021, when the Windy City registered gains of 10.8 percent.
During the pandemic’s real estate hot streak, Chicago consistently ranked near the bottom of such lists, as it’s typically more resistant to volatile market swings. Now, the slow-and-steady appreciation of Chicagoland’s housing market is paying dividends, leading the nation in home price growth in back-to-back months, according to S&P CoreLogic Case-Shiller Indices.
Other cities, like San Francisco and Seattle, have seen their home values plummet after they surged during the pandemic boom.
Last month’s price increases, locally and nationally, can be attributed to scarce inventory. Many would-be sellers are waiting for mortgage rates to lower before braving the market, contributing to minimal inventory supply. Most homeowners have mortgage rates of less than 4 percent, but if they were to sell their home and buy a new one, they would pay considerably higher rates of roughly 7 percent, the outlet said.
“Supply would have to essentially double to moderate home price gains,” Lawrence Yun, NAR’s chief economist, said in the national report.
The housing shortage has led to a decrease in sales volume, as well. In Chicago, 2,189 homes sold in August, down 7 percent from one year prior and the slowest month of August since 2011.
— Quinn Donoghue
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