5 Indicators the real estate market is improving in Illinois

When I’m asked what I think the real estate market is going to look like this spring and summer, I have to first reflect on what the real estate market looked like last year. The 2014 real estate market was actually one of the most stable real estate markets in recent years.

All indicators suggest that this trend will not only continue in 2015, but continue to rise. Here are 5 reasons to be optimistic:

1. Inventory: For the past few years, the lack of houses for sale has impacted our local real estate market along with the high quantity of distressed sales (short sales and foreclosures). We’re already seeing that more homes are on the market with fewer of those homes being distressed sales. New Construction listings continue to rise as well. A few years ago you were hard pressed to find new construction homes and builders were going bankrupt left and right. As a matter of fact, quite a few big named builders even went under. Last year we began to see new construction again and now in 2015 there’s even more…a good indication that the market is heading in the right direction.

2. Price: Homes are appreciating in value! Yes, each subdivision is different, but as a whole, median sales prices were up in 2014 compared to the same months in 2013. We are no longer decreasing in value, prices are finally consistently going back up. Many homeowners have regained equity in their properties and are ready to test the market.

3. Interest rates: Interest rates are still hovering around 4 percent. That’s great news for the spring and summer markets allowing buyers to purchase with great rates. Additionally, FHA announced in January that they were lowering the annual MI premium making homeownership likely for some who wouldn’t otherwise be able to purchase bringing even more buyers into the market.

4. First-time homebuyers: We had recently seen a decline in first time homebuyers due to tighter loan restrictions and higher down payment requirements; however, recent announcements of new 3 percent down programs have put purchasing a house within reach of first time buyers again, leading to strong spring and summer real estate markets.

5. Previous short sale sellers: Previous home owners who were forced to sell their homes as short sales are now able to purchase again. Those who did short sales on their homes back in 2012 are now able to purchase again after the 3 year waiting period; therefore, ditching the rental home and purchasing a property again. We’ll see these buyers coming back into the market not just this year, but for the next few years.

The real estate market is looking good with more homes coming on the market, increasing home values, low interest rates, and more qualified buyers. Call (630) 712-1921 today if you’re looking to purchase a home or sell your home.