CASE-SHILLER CHICAGO CONDO INDEX
The Case-Shiller Chicago Condo Index for March was 148.8, up 2.1% from March 2018. It was also up 2.1% in February.
The Chicago Condo Index outperformed the condo indexes for New York City (unchanged), Los Angeles (1.7%) and San Francisco (unchanged), only trailing Boston (3.3%).
Looking at the index month to month it was up 1.2% from February. The index is usually up from February to March as the market starts coming out of the slower winter season.
The Case-Shiller Condo Index for Chicago is based on resales of condos for the Chicago Metro Area. It’s published with a 2 month lag.
CASE-SHILLER CHICAGO INDEX
The Chicago Case-Shiller Index for March was 142.6, up 1.8% from March 2018. It was the smallest annual increase since October 2015.
Looking at the index month to month it was up 0.6% from February. Like the condo index it typically goes up from February to March.
The Case-Shiller Index for Chicago is based on resales of single-family homes (houses) in the Chicago Metro Area. It’s also published with a 2 month lag.
CASE-SHILLER CHICAGO INDICES
The Chicago Condo Index has outperformed Chicago’s house index for over 4 years now. It rose above the house index in November 2014 and has stayed above every month since. It’s currently 4.3% above the index for houses.
The Case-Shiller Chicago Indices reported here are part of the Standard & Poors Corelogic Case-Shiller Chicago Home Price NSA Index. Instead of calculating a median sale price the indices use a repeat sales method. It analyzes sales data for properties with 2 or more recorded sales transactions. Sales between family members, properties with significant physical changes and sales data that appear to be erroneous are eliminated.
The indices are published with a 2 month lag due to the fact that homes sales aren’t always recorded immediately. It also takes time to properly analyze home sales data.
One of the benefits of the repeat sales method is that large new condo development closings have no impact as they do for the median sale price statistic. When a large condo development starts closing the sale of their units there might be several in the same month. In the past few years new condo developments in Chicago have also tended to cater to higher price markets. Thus, when these developments start closing the sale of their units it pushes the median sale price higher which might not reflect the overall condo market.
WHAT THIS MEANS FOR BUYERS
As you can see from the chart, prices have an annual pattern. It has been more pronounced since the housing bubble.
Prices are lower in the winter season as there is less competition between buyers. There’s more inventory to choose from now, but you’ll be competing with more buyers which is pushing prices back up.
Regardless of season be ready to buy when you find a home you want. There could be competing offers, especially if the home is priced competitively. If you will be getting a mortgage, get your mortgage pre-approval before you start seeing homes. If you’re paying cash, get a proof of funds letter from your accountant or banker ready.
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WHAT THIS MEANS FOR SELLERS
As you can see from the chart, prices have started improving, but you still need to price competitively.
Most buyers have to finance their purchase. Your home will need to appraise for at least sale price for financing to be approved. The appraised value is primarily determined by recent comparable sales for the past 6 months.
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