Where is Illinois real estate pricing headed in 2023?
By Thomas Haught
Home sales are low – but we’re only a few weeks into the year. I have heard more than one real estate agent say that the first day of the year (for their purposes) is the Monday after the Super Bowl. The Super Bowl is over, so in theory at least, it’s time for real estate sales to ramp up. But there is not a lot of real estate activity when the weather is bad. And as I write this, there’s a couple of inches of wet snow on the ground and my garage was frozen shut this morning. So, while Punxsutawney Phil may have predicted six more weeks of winter, real estate agents and real estate attorneys are hoping for an early spring!
Of course, low inventory, high prices, inflation and rising mortgage (the perfect storm?) are affecting the market. But the inflated prices of 2021 and early 2022 are stabilizing. We are no longer seeing 15 competing contracts like we did when interest rates were around 3 percent, which lead to the hottest real estate market I’ve seen in my career (and I’ve been doing this for 24 years).
The typical value of homes in Illinois is about $267,000. But values have gone up almost 12 percent in the last year and more than 27 percent in the last two years! Growth like that is simply not sustainable. However, by the third quarter of last year, sales slowed dramatically and are still slow (although, as mentioned above, the mix of cold weather and the holidays historically almost always slow the real estate market).
They say that if a stockbroker ever tells you that he or she knows where the stock market is headed, run the other way. That also holds true for real estate agents and real estate attorneys. However, my office believes that all signs point to reasons to be optimistic. Unemployment is at historic lows. Inflation, while not yet put back in the cage, does seem to be getting tamed. And while we might be freezing today, the weather will be warming up in the coming weeks and months. Given that, my office predicts a strong real estate market in 2023. And I think that our predictions are as good as, if not better, than Punxsutawney Phil’s!
If you are in the market to buy or sell a home, the attorneys at Gardi, Haught, Fischer & Bhosale Ltd., can help you every step of the way. Even before you go under contract, if you have any questions about your real estate deal, please do not hesitate to contact us by requesting a free case evaluation below.