In the current market, with so many well priced homes available, it isn't surprising to see a higher level of sales activity in those communities that are relatively close to the city and served by commuter rail
Chicago, IL (Vocus) September 9, 2010
Suburban Chicago communities served by Metra commuter trains generally saw a greater increase in home sales in the first half of 2010 than did the entire suburban portion of the seven-county Chicago real estate market. However, both the Metra-served communities and entire suburban market experienced similar declines in home prices, according to the third annual Metra Community Study conducted by the RE/MAX Northern Illinois real estate network.
The latest RE/MAX study analyzed home sales in a three-town sample along each of the 11 Metra corridors throughout the Chicago suburbs and compared sales there to homes sales in the overall suburban market. The study compared sales data for the first half of 2010 to data from the same period of 2009.
This year, homes sales in Metra-served communities were 47 percent higher than in 2009, compared to the 37 percent increase recorded by the total suburban market. The average sales price of a home in the Metra-served towns was $275,266, while in the total suburban market the average price was $239,064. Both of those averages represent a 2 percent decrease from the comparable average price recorded in 2009.
The median home sales price (which marks the statistical midpoint among all prices paid for homes during the period) in Metra communities for the first half of 2010 was $210,000, down 3 percent when compared to the same period in 2009. The median home price in all suburbs declined 4 percent to $180,000.
The average number of days spent on the market by all homes sold in Metra-served communities was reduced by 4 percent to 177 days, while in the entire suburban area the average market time was 170 days, a 7 percent reduction compared to 2009.
The 2010 RE/MAX study also compared 2010 home sales activity with that of 2006, the height of the housing boom. This longer-term perspective reveals that Metra served communities retained a higher level of sales activity than the total suburban market but that prices declined equally.
Thirty-two percent fewer homes were sold in Metra-served communities in 2010 than in 2006 (6,960 in 2006 vs. 4,719 in 2010), while in the total suburban market, sales activity fell 38 percent from 42,169 homes in 2006 to 23,164 homes in 2010. There was little difference in the rate at which home prices declined. In both Metra communities as a whole and the total suburban market, average prices fell roughly 19 percent, and the median price declined approximately 21 percent.
The RE/MAX study also found that changes in sales activity and home prices varied widely among the 11 Metra lines when comparing 2009 to 2010. That range in results is made clear by the contrast between the Metra North Line, which serves the North Shore, and the Metra Electric line to the south suburbs. Home sales along the North Line increased 75 percent, the most of any line, but the average price dipped 10 percent to $530,145. In contrast, home sales along the Metra Electric line were up just 1 percent over 2009, but the average price rose 24 percent to $86,967.
A majority of Metra communities saw robust growth in transaction volume, along with modest declines in median and average prices. When both sales activity and price levels are considered, the best overall performance was turned in along the Union Pacific West Line. The 447 home sales there represented a 57 percent gain over 2009. At the same time, the median sales price rose 9 percent to $326,000, and the average sales price was up 3 percent to $370,293.
The RE/MAX study also analyzed the selected Metra towns based on their distance from downtown Chicago, grouping them into three categories – towns close to the city, those most distant from the city and towns in between.
Last year’s study showed that those Metra towns most distant from the city turned in the best performance relative to the overall suburban market. Towns closest to Chicago trailed the field. In 2010, Metra communities closest to the city led the pack, with a 59 percent increase in transaction volume and increases in both the average and median home price. The average price of a home sold in Metra communities closest to Chicago rose 5 percent to $276,415, while the median sales price was up 6 percent to $220,000. The average market time for sold properties was trimmed from 181 days to 176 days, a 3 percent improvement. Both the most distant and middle distant Metra communities recorded a 43 percent increase in homes sold, a shortening of average market times and declines in average and median prices.
As a group, middle-distant towns fared slightly better, with the average price of a home falling only 4 percent to $345,508 and the median price decreasing 3 percent to $353,750. The average market time was reduced by 6 percent to 186 days. For the most distant Metra communities, the average price dipped 5 percent to $220,230; the median price declined 7 percent to $186,900, and average market time was cut by 5 percent to 170 days.
“In the current market, with so many well priced homes available, it isn’t surprising to see a higher level of sales activity in those communities that are relatively close to the city and served by commuter rail,” said Jim Merrion, regional director of the RE/MAX Northern Illinois real estate network. “What is more telling is that our Metra-served towns as a group showed a much stronger increase in sales activity than the overall suburban market.
“Because families today are putting more emphasis on reining in their expenses, access to public transit may be more significant to home buyers going forward than at any time in recent years.”