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The Chicago real estate market is going through a tough moment. Sales of new and re-sale single-family homes are down, and demand for condos in many neighborhoods around the city has fallen. However, there are new opportunities for buyers ready to take the leap into the market.
April 2008 sales of new and re-sale single-family homes fell by 23 percent from the same period last year on total sales of just 546 units. The drop in sales is even more pronounced from April 2006, when 949 homes were sold citywide. Meanwhile, prices continued to fall both on the lower and higher end of the market around the city. Prices in the southern half of the city were off more than 25 percent in April, while the more affluent northern half of Chicago saw prices fall by 28 percent from the same month last year.
On the supply side of the market, Chicago led the country in the number of new and re-sale single-family homes to come on the market in April, according to a report published May 8 by ZipRealty.com. The city saw an increase of 5.9 percent in the supply of homes from the previous month, higher than any of the 29 major metropolitan areas included in the report. The high supply of homes on the market and falling demand could mean even lower prices for buyers in Chicago over the next few months.
The market for Chicago Condos is also facing a difficult moment, particularly for lower priced units around the city. According to data collected from the MLS for April, sales of new and used condominiums across the city fell by an impressive 31 percent from the same month last year. However, despite the dramatic drop in demand for condos around Chicago, prices rose by 21 percent, fueled by high demand for million dollar condominiums around downtown.
Buyers are picking up high-priced condominiums at an increasing rate. A total of 18 units were sold for more than $1 million in the Loop in April, up from just 1 unit that sold in that price range in April 2007. This surge in demand for million dollar units is driving the increase in the average sales price.
More new construction condominiums will be coming on the market in downtown Chicago this year than ever before. According to data from Appraisal Research Counselors, a total of 5,984 new construction units will hit the market this year, adding to the high numbers of unsold condominiums on the market in the city.
Buyers should keep an eye on market conditions around the city. Specific markets such as those found further from downtown are hiding great deals on condominiums and single-family homes. Negotiate for a price that reflects the current market conditions in Chicago.