Wait, Wait, Wait…Hurry Up! (May 2011 Insider Report)

Redfin’s monthly Chicago real estate insider report draws from our proprietary database of information on homes for sale and that just sold, along with insight from our agents to get a sense of what’s going on in the market right now. If you’d like to receive the report via email, just sign up.

Hey There Chicago Redfinnians!

Heading into summer, inventory seems to be rising faster than the temperatures; both month-over-month and year-over-year inventories have increased dramatically. While many buyers are still sitting on the fence, worried about the double-dip in prices shown by the most recent Case-Shiller report, some are viewing the current low prices and interest rates as a signal to dive in head-first.

Lots of Chaff, Bits of Wheat

The chart below shows that inventory is up across the board, both compared to last month and this time last year. And yet, with all those homes out there, buyers are finding themselves in one competitive bidding situation after another. What’s the deal with that?

County Compared to April 2011 Compared to May 2010
Cook County +8.4% +7.8%
DuPage County +11.2% +8.3%
Kane County +9.0% +13.3%
Lake County +9.7% +4.1%
McHenry County +9.6% +6.3%
Will County +11.0% +10.0%

Change in # of Houses for Sale on May 31st 2011

While there are plenty of homes on the market, there aren’t enough good homes to go around, and buyers are starting to catch on to this latest mini-trend.

Cindy Hahn, one of Redfin’s Chicago tour coordinators, has noticed buyers picking up the pace: “Clients are displaying a stronger sense of urgency; they want to view their top home picks as soon as possible.”

Patrick Lusk, a Redfin Western Suburb Redfin Agent, concurs: “There has been plenty of talk about multiple offers on good properties. There’s a mad dash to see the good one first.”

So what about the rest of the inventory — the stuff nobody seems to want? Redfin Chicago agent Greg Whelan points out that these homes are stale, and that the fresh, high-quality, well-priced homes are much more limited in numbers.

That’s the story with inventory: lots of homes, but the good ones go fast. Buyers who try to out-wait sellers have seen their plans backfire as other buyers swoop in with better offers. We’re seeing more and more Redfin buyers stepping up to beat the competition to the punch. Does that mean we’re seeing a rise in sales?

Sales Are Inching Up

In fact, the data does show a lift in transactions. While the market is still well below last year’s sales numbers, May’s transactions are substantially higher than April’s, especially in DuPage and Kane Counties. Also, keep in mind that it’s hard to compare this year’s numbers to May 2010, because last year’s federal home buyer tax credit was still in full swing. There’s no such stimulus in place now.

County Compared to April 2011 Compared to April 2011 Adjusted for # Weekdays Compared to May 2010 Compared to May 2010 Adjusted for # Weekdays
Cook County +6.1% +1.3% -16.6% -20.4%
DuPage County +18.9% +13.5% -14.9% -18.8%
Kane County +21.8% +16.2% -17.0% -20.7%
Lake County +8.8% +3.9% -6.0% -10.3%
McHenry County +5.0% +0.2% -2.5% -6.9%
Will County +4.0% -0.7% -37.6% -40.5%

Change in # of Houses That Sold in May 2011

The overall trend seems to be confirmed by what we’re seeing internally. Redfin Chicago has just had a record run of offer submissions, including 39 offers during the first full week of June (compared to 13 during the comparable week of 2010).

Now, what about prices?

Prices

When we look at median price-per-square-foot for May, we see an increase since April.

County Median Price in
May 2011
Median $/SqFt Change
since April 2011
Median $/SqFt Change
since May 2010
Cook County $160,000 +0.8% -13.4%
DuPage County $265,000 +4.5% -7.9%
Kane County $160,000 +5.7% -15.5%
Lake County $210,000 +5.6% -8.1%
McHenry County $169,900 +3.6% -14.9%
Will County $175,000 -2.2% -14.4%

Change in Median Price of Houses That Sold in May 2011

At first, this might appear at odds with the May 31st Case-Shiller index, which claimed that prices were down month-over-month. But remember, the Case-Shiller is always two months behind; the May 31st report reflects trends through March 31st. It remains to be seen how the numbers compare on subsequent updates.

That’s our Insider Report for May! Want to know what’s happening in your neighborhood? Download our comprehensive spreadsheet and dig into the data for yourself! Inside you’ll find county, city, and neighborhood information galore. To learn more about how we calculate these numbers, check out our methodology page. You can also liven up the place by posting a comment below.

  • avonia photography

    Your monthly updates really help and we agree with about 99% of what you guys write about. We have made numerous offers already (on the better homes), and many have ended up being multiple offers at once. Gosh! Here is to hoping something picks up soon. http://www.avoniaphotography.c

  • http://www.facebook.com/profile.php?id=1620393131 Brian Wright

    Pretty much what I've seen. Anything that is nice and a good deal is getting snapped up quick. Overpriced homes that need a lot of updating are sitting on the market forever though. It is really strange having multiple offers in this market, but almost every home I've been interested in, this seems the case.

    • Beth G.

      We put in 3 bids on our favorites and within 1 day there were multiple offers on each. We had to go in at asking price for the home we purchased, and we only beat the other offer by $3K. It seems that if you like a house, go for it, because chances are someone else will feel the same since there are not a lot of “great” houses out there at reasonable asking prices.

  • http://pulse.yahoo.com/_I3ABY2ROSRYFOKEGHYU7GUAAH4 Joshua James C

    Yes plus with a prediction saying that there's a potential 10-25% fall in prices, buyers are still on the fence like my parents. There are many nice houses in the Palos Hills and Palos Park area, they are just cautious on which house to buy since that prediction of 10-25% fall came plus with all the debt the government is piling, it's only a matter of time until something happens. 

    And also, the property taxes are just keeping the potential buyers away especially in the Palos Hills/Palos Park/Palos Heights area and some areas of Hickory Hills where property taxes are just crazy.