September Insider Report: Brr! It’s Still a Cold Market around Chicago

by Tim Ellis | 2 Comments

Greetings, Redfinnians!

Redfin National Heat IndexThis month we rolled out a new and improved version of our monthly insider report. “But where is it,” you ask. Ahh, well this new report is available via email-only, and was sent out to a group of registered users who have saved searches or favorites in select neighborhoods.

We’ll be expanding the report to include more neighborhoods every month, so if you want to make sure you get it when it comes to your ‘hood, just make sure you’re signed up for our newsletters (check the “Redfin Announcements” box in your Account Settings), and save a favorite home or a search. That’s it, you’re signed up!

Here on the blog we will continue posting the “lite” version of our monthly report, including our Redfin Heat Index, the heat map, and the hottest / coldest neighborhoods for the foreseeable future. So, let’s get into it.

First up is our national Redfin Heat Index* ranking table at right. Although Chicago’s Heat Index fell a couple points from last month, the city actually moved up the list just a tad. As home price losses taper off, Chicago’s moved from #15 in August to #14 in September, trading places with Las Vegas.

Washington DC continues to be the hottest market in the nation, while Long Island is still pulling up the rear with falling prices and a dramatic 11.1 months of supply. Yikes!

Next up, let’s have a look at an update to our interactive Redfin Heat Index map broken down by zip code, based on September data. Note that we only calculate the Redfin Heat Index for zip codes with at least 20 sales in September 2011 and September 2010, and as we head into the winter that means more and more zip codes will be grey with “not enough data.”

Heat Map Color Legend

All righty, that’s it for this month. Stay tuned as our new and improved local Insider Report makes its way to your neighborhood.

As usual, you can download our comprehensive spreadsheet and dig into the data for yourself. Inside you’ll find county, city, and neighborhood information galore. You can also liven up the place by posting a comment below.

*Methodology
The Redfin Heat Index (Beta) uses listings, sales, and price changes to determine the relative “heat” of a given real estate market. We set a baseline Heat Index of 75.0 at 6.0 months of supply and +5 % price change year-over-year.
Every percentage point increase in prices above the 5% baseline will increase the heat index by two points, every percentage point decrease in prices below the 5% baseline will decrease the heat index by two points.
Every one month of supply increase above the 6.0 baseline will decrease the heat index by seven points, every one month of supply decrease below the 6.0 baseline will increase the heat index by seven points.
Here’s the formula:
  • MOS = Months of Supply: End of Month Inventory / Closed Sales in the Month
  • $YOY = Year-over-year change in the median price per square foot.
  • Heat Index = ((MOS – 6.0) * 7) + (($YOY – 5%) * 2) + 75

Related Posts