June housing sales hit year high
Rockford Area Realtors sold more homes in June than any other month this year, a total of 378 homes, up 37 percent over 276 homes sold in May. And for the first time in six months, monthly sales were up over 2010 levels (378 compared to 371 homes sold in June 2010, a 1.9 percent increase).
The three-month average rolling price in June of $105,766 also rose from May, up 1.8 percent from $103,916.
“June was the third-highest monthly sales total in the last year-and-a-half,” said Steve Bois, CEO of Rockford Area Realtors. “Yet, there was no homebuyer incentive this year, unlike last year when the largest tax credit ever given to homebuyers expired on June 30, 2010.”
Prices in general remain down from last year, the June 2010 average price was $120,327, 12 percent higher than this June’s average price of $105,766. But Bois said the drop in home price is good news for hundreds of area young families and renters who were once priced out of the housing market.
A new Housing Opportunity Index by the National Association of Home Builders and Wells Fargo — which measures the percentage of American homes sold that are affordable to families earning the national median income — is at an 11-year high. In 2000, nearly 63 percent of homes were affordable by median earners, but only 40.4 percent in 2006.
Today, median earners can afford 75 percent of all homes sold.
As the housing market slump continues, Bois said aspects of homeownership are being debated. According to a June survey by The New York Times/CBS News, owning a home remains central to Americans’ sense of well-being, even though there is roughly an even split between those who consider making an offer on a house a risky versus safe investment.
“Nearly nine of 10 Americans reported that homeownership is still an important part of the American dream,” Bois said. “And they are keen on making sure it stays that way for themselves.”
Meanwhile, it appears the effect of the homebuyer tax credit will finally fade in Illinois during the summer.
“According to our forecast, annual sales rates will turn positive for Illinois in July and August, a 22- to 25-percent increase statewide,” estimated Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois. “Median prices for June, July and August are expected to be higher than May across Illinois.”
From the July 20-26, 2011 issue