CASE-SHILLER CHICAGO CONDO INDEX
The Case-Shiller Chicago Condo Index for February was 147.0, up 2.1% from February 2018. It was a improvement over the past 3 months which were up less than 2%.
The Chicago Condo Index outperformed the condo indexes for New York City and San Francisco which were both unchanged, but trailed Los Angeles (+2.3%) and Boston (+3.1%).
Looking at the index month to month it was down 0.2% from January. The index has a mixed performance from January to February with both increases and decreases over the past several years.
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 February was 141.7, up 2.2% from February 2018. It was the smallest annual increase since March 2016.
Looking at the index month to month it was unchanged from January. The index has a mixed performance from January to February with both increases and decreases over the past several years.
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 3.7% 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.
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 will start improving. For the past few years they started rising around February and peaked during July and August.
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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