“Last month didn’t feel like February, but unusual has become the norm in this market,” explains Greg Whelan, Redfin Agent in Bucktown. The lack of quality inventory and the soaring demand made it seem more like a typical May or June. “Specifically, within Bucktown, where there were 25% fewer homes on the market last month than there were a year ago, nearly every non-distressed single family home that hit the market was subjected to multiple offers, especially below that $800K sweet spot.” But, within West Town and Logan Square, the market is becoming more and more balanced with just about a six months’ supply of homes for sale, which is pretty much ideal—neither a buyer’s nor a seller’s market.
As we move into the true spring months, we expect inventory to follow its normal upward trend as more sellers but their homes on the market. “Prices may be low, but it would be hard for someone considering selling to ignore all the reports of inventory shortages and multiple offer situations,” Greg said, “but, I don’t expect to see inventory take a bigger than normal jump to meet demand over the next few months.”
For a complete picture of the local market’s most recent stats and trends, download the Redfin Market Report here: Redfin-Chicago-Real-Estate-Market-Report-February-2012. Want to know how the Chicago real estate market is doing compared with the rest of the country? Take a look at the Redfin Heat Index:
*Redfin Heat Index 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