The market for Chicago-area homes selling at $1 million or more showed broad strength in the first quarter of 2018, according to the RE/MAX Luxury Report on Metro Chicago Real Estate, a quarterly analysis of market activity.
First-quarter sales totaled 489 units, the most in that quarter since RE/MAX began tracking luxury sales in 2011 and an increase of 7.5 percent over the same quarter last year.
Perhaps of even greater significance was the 5.5 percent increase in the median sales price of $1-million-plus homes, which came in at $1.35 million. It was the second consecutive quarterly gain following four quarters in which the median price declined in comparison to the same period one year earlier.
In addition, there was a continued reduction in the number of unsold homes listed for at least $1 million. Luxury listings fell 5.6 percent to 2,742 units, declining only .6 percent in the city of Chicago but falling 8.4 percent in the suburbs where the inventory had been especially high for the last few years. Even with that reduction, existing luxury listings in the suburbs still represent a 22.5-month supply of homes based on the pace of first-quarter sales.
“Demand for luxury homes is clearly on the upswing right now, but only time will tell if this is a temporary situation sparked by buyers eager to act before interest rates move higher, or if this reflects a longer-term trend that will help pare down the large number of luxury listings on the market,” said Jeff LaGrange, vice president, RE/MAX Northern Illinois Region.
“Of particular interest going forward will be the trend in the median sales price. If it continues to advance, it will confirm that demand and supply are moving into better balance,” he said.
Suburban luxury sales, which almost exclusively involve detached homes, delivered generally positive results, he said. Sales activity rose 7.5 percent to 229 units during the first quarter, and the median sales price climbed 2.4 percent to $1.3 million compared to the same period last year. Average market time, however, increased to 257 days from 228 days a year earlier.
Hinsdale had the most active luxury market during the quarter, with 29 sales completed, a 16 percent increase, while its traditional rival for the top spot, Winnetka, recorded 23 sales, a decline of 17.9 percent.
Solid sales gains were seen in several other leading suburban luxury markets, including, Wilmette, up 8.7 percent to 25 units, Lake Forest, up 84.6 percent to 24 units, Naperville, up 116.7 percent to 13 units and Glencoe up 120 percent to 11 units.
Source: Daily Herald