IL Housing Forecast for 2009
March 13th, 2009 categories: Local Markets
Leading economists from the University of Illinois Regional Economics Applications Laboratory (REAL) have published a report “Housing Price Forecasts: Illinois and Chicago MSA, February 2009″
The Economy:
According to these economic experts, our local economy is struggling. In 2008 , Illinois lost 100,000 jobs and unemployment is now 7.9%. During the month of December (36,000) jobs were lost. All sectors of the economy were affected from construction, trade, transportation and utilities, manufacturing, and professional and business services. It is predicted that any stimulus package will only help to retain jobs lost and will not create new jobs.
The Housing Market:
The National Association of Realtors (NAR) reports Illinois inventory of homes for sale to be 9.5 months and 11.5 months in Chicago. It is clear that the increase in the number of foreclosures has been a major contributor to the number of homes coming on the market for sale. The number of foreclosures is not likely to abate soon even with new initiative proposed by the Obama administration.
Housing sales in Illinois are also declining. Forecasts for the next three months indicate a 20-28% decline in sales for the state and Chicago respectively. These forecast figures do not look good for the Spring Market.
In addition to fewer homes being sold, experts also are showing declines in Median home prices. The Median price $150,584 in the state is 19% lower than April 2008 levels. In Chciago price the Median home price of $169,135 is 30% lower than last year levels.
A turnaround in the housing market is unlikely over the next 12 months. The number of foreclosures will continue to affect inventory levels, home prices through out the state and city of Chicago.
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