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Latest Numbers For Chicago Show New Home Closings and Prices Increase

Posted on: May 06, 2013 07:06:49 AM

In the Chicago, IL market, new home closings grew year-over-year in January, and there were hints of strengthening market conditions as the percentage lift was sharper than December 2012. New home closings saw a boost of 30.5% from the year earlier to 295. This came after a 7.8% rise year-over-year in December.

A total of 4,912 new homes were sold during the 12 months that ended in January, up from 4,843 for the year that ended in December.

New home closings accounted for 3.2% of overall housing closings. As a part of the whole, new home closings were 2.4% a year earlier. Following a year-over-year rise in December, closings of new and existing homes slipped year-over-year in January.

Pricing and Mortgage Trends

In January, the average price of newly sold homes climbed year-over-year to $399,040 per unit, a 18.8% surge. This gain is higher than the 6.3% rise in December year-over-year.

Average mortgage size on new homes jumped year-over-year along with new home prices. In January 2013, the average mortgage size on newly sold homes saw a 19.9% rise from a year earlier. In December 2012, average mortgage size increased 6.6% from a year earlier. For newly sold homes, the percentage of sale price being financed moved from 74.7% of average price to 75.4% from a year earlier. It moved from 79.5% in December 2011 to 79.7% in December 2012.

Other Market Trends

Single-family homes accounted for a greater percentage of new home closings than last year. Single-family home closings rose from 55.3% of new closings in January 2012 to 67.1% of closings in January 2013. Conversely, the share of new home closings belonging to attached units declined to 32.9% of closings from 44.7% of closings.

The average unit size of newly sold homes sank 25.9% year-over-year to 2,425 square feet in January 2013. For newly sold homes, an average size decline contrasting with an average price boost was also seen in December 2012 when the average size of newly sold homes declined 4.9% to 2,531 square feet.

Foreclosures and real estate owned (REO) closings declined in January from a year earlier, but stayed a drag on the market. Together, foreclosures plus REO closings made up 52.6% of existing home closings, down from 64.8% a year earlier. The percentage of existing home closings involving foreclosures slid to 18.9% in January from 42.0% a year earlier while REO closings as a percentage of existing home closings gained to 33.7% from 22.8%.

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