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"I’m constantly taking the temperature of both total sales and prices, both from the standpoint of morale for the Realtors and also for the realistic picture," said Al Suguitan, association executive for the Greater Gateway Association of the Illinois Association of Realtors. "Even with slightly increasing interest rates, it looks like 2004 will be just as good a year for housing as 2003."
The Greater Gateway Association reported a 6.6 percent increase in single-family home sales this April as compared to last April. Suguitan said there were 387 such sales this year and 363 sales in April 2003. The median price of existing single-family home sales in the area dropped slightly -- from $79,600 to $78,700. However, the median price for first quarter of 2004 was up 7.7 percent from the first quarter of 2003, from $80,100 to $86,300.
Madison, Calhoun, and parts of Macoupin, Montgomery, Fayette, Clinton and St. Clair counties make up the Greater Gateway Association, which is one of 37 that make up the Illinois Association of Realtors.
The statewide figures showed a 2.9 percent increase in the median price from the first quarter of 2003 ($160,300) to 2004 ($165,000) and a 3.3 percent increase in home sales (from 21,690 to 22,407). In April, 10,908 existing single-family homes were sold statewide compared to 10,005 last April. The median price rose 5.8 percent from last April to this April, $168,700 to $178,500.
"Realtors continued their busy streak with home buying and selling showing no signs of waning and re-sales posting the highest numbers on record for April," said John Kmiecik, president of the Illinois Association of Realtors. "Mortgage interest rates were below 6 percent for most of the month, and that certainly motivated people to enter the housing market.
"But that’s the only factor at work here. Housing’s underlying strength is tied to Illinois’ improving economic picture. Newcomers to the market include immigrant, first-time homebuyers and baby boomers who are ready to downsize, trade up or purchase a second home."
The monthly average commitment rate for a 30-year conventional fixed-rate mortgage for the North Central region was 5.95 percent in April, up from 5.45 percent in March, according to the Federal Home Loan Mortgage Corporation.
"Realtors experienced slower sales up until March (this year), when spring fever hit and fence-sitters got in the market while interest rates were still below 6 percent," Kmiecik said. "Given the growing strength of the economy and positive job growth, the long-term picture for housing remains favorable."
The association surveys cover non-seasonally adjusted median prices for existing, detached single-family homes and condos.
The first-quarter 2004 Illinois Housing Affordability Index stood at 182.44. The means that a four-person family earning the median statewide income of $66,507 had 182.44 percent of the income needed to qualify for conventional financing covering 80 percent of a home priced at the median price of $165,000.
"With the economy expanding, we’re seeing a slight increase in interest rates that shouldn’t hinder home sales, as there are a variety of mortgage options out there," Kmiecik said. "Buyers are also taking advantage of adjustable rate mortgages as an attractive alternative to the fixed-rate mortgage. New construction is also expected to boost home sales even higher during the summer months."
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