Posted in Chicago Market | Posted on 04-29-2013 | Written by Metrostudy News
(Chicago, IL– April 29, 2013) The housing market in Chicago continues to show steady signs of improvement. Although the growth has not been robust, and construction levels are well below historical norms, the rate of new home contruction grew by 37% compared to the first quarter of the previous year.
With 811 housing starts tallied through the first quarter of this year, new home builders continue to see improvement in the level of demand for their product. In the first quarter of 2012 there were 592 housing starts. The annual rate of new home starts reached 4,013 units in the first quarter, the first time housing starts have reached the 4,000 unit plateau since mid-2009.
There still are several concerns in the near term that could negatively impact the new home market, however. The number of foreclsoures, both in terms of new filings and the actual number of units foreclosed on, continues to rise. The local economy is also still a concern. This in light of the fact that there does seem to be some job growth occurring in the local market. There was a net increase of over 55,400 jobs reported in the Chicago metropolitan area during the most recent twelve-month period. However, unemployment levels remain elevated at 10.4%.
Inventory is still a concern as well. Not necessarily the amount of new home inventory sitting on the market, but the amount of lot inventory that is out there. “There are still over 50,000 fully improved home sites out there ready to build on,” says Chris Huecksteadt, Metrostudy’s Director of Midwest Markets. “Many of these lots are in far flung areas that may not see significant construction activity for several years,” he added.
Given where the market has come from there is still reason for optimism among those active in the local new home market. “Most production builders here are seeing more traffic serious about buying a new home, and willing to pay what builder’s are asking, than they’ve seen in a long time,” Huecksteadt said.
For information contact:
chris huecksteadt @ 847.241.6570
Metrostudy, a Hanley Wood company, is the largest provider of comprehensive research and insight for the real estate industry. Builders, developers, banks, manufacturers, retailers and many other industries all rely on Metrostudy’s data and analytics to support strategic business decisions at the local, regional and national market level. www.Metrostudy.com
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