Record year for home sales


By Mike Comerford Daily Herald Business Writer
Posted February 12, 2004


Just when people thought the Chicago housing market couldn't get any hotter, it posted another record year in 2003.

Existing single-family home sales in the Chicago metropolitan area increased about 5 percent last year and home prices jumped 8 percent, according to a survey by the Illinois Association of Realtors.

In the suburbs, McHenry County and Aurora area sales grew the fastest but prices jumped the most in Elgin, DeKalb County and the West suburbs.

"The year finished strong despite what all the prognosticators were predicting," said Steve Hovany, president, Strategy Planning Associates Inc., a real estate research firm in Schaumburg.

Statewide, the number of homes sold rose nearly 6 percent and median price rose nearly 7 percent.

The median home price for the state was about $172,500 and for the Chicago metropolitan area it was about $224,500. The priciest area in the Chicago area was the North Shore where the median price for a home was $490,400.

The Realtors association credited low interest rates, high demand and a recovering economy for the heated buying year.

"Illinois Realtors closed an exceptional year in 2003 as home ownership was achieved by so many people and housing bolstered an otherwise sluggish economy," said John C. Kmiecik, president of the association, in a statement.

Lake County and Elgin put up some of the biggest numbers, in terms of sales, but were flat from 2002's record pace.

The Barrington area fell in both the pace of sales and the price of homes. But Hovany said its market is so pricey, a few "big buck sales" can sway its numbers from year to year.

New home sales, Hovany said, kept up about the same record pace as existing homes.

In fact, he said, new home sales in the first six weeks of this year are higher than last year's clip.

That has caused concern among some housing analysts that the industry cannot sustain this pace, Hovany said, but he's not worried. He sees an improving economy and downward pressure on joblessness.

"This year is likely to be a continuation of last year," he said. "The same conditions that led to a record year last year will be there still."