Market Update 2nd Quarter, 2021

Dated: July 15 2021

Views: 145

For the first few months of 2021 and into late spring, the storyline in real estate has been the same. Stories of low inventory, multiple offers and a frenzied seller’s market dominated all real estate conversations. While we’re still seeing a strong seller's market and fast-moving properties, we’re also starting to see indications of a shift towards a more normal market. 

Indicators are popping up in the Chicago market as a whole, as indicated in this Chicago Agent Magazine article, and in the local Elmhurst market.

Locally, we’re still seeing the average sale of homes increase ...

... as well as a substantially under-supplied housing market.

However, those numbers are calculated by averaging out the previous 12 months of data. When you break down Elmhurst’s housing supply by individual months, you’ll see the beginnings of a possible tick up in inventory that we haven’t seen since early 2020. 

Since mid 2020, Elmhurst has seen the housing inventory drop until it fell to  below 2 months supply in March. Over the last 3 months, we’ve seen inventory slowly creep up. This is good news, overall, as it’s widely believed that a “healthy” or even market has a housing supply of between 4-6 months. 

Additionally, this is the first month in a while that we’ve seen typical seasonal traffic. In June, we saw a drop in average sales, which is normal for the summer months as summer plans and travel tend to affect overall foot traffic.

This is still uncharted territory for experts and pundits, but many are suggesting a shift towards a more even market in the second half of 2021, as indicated by this Chicago Agent Magazine article, which sites data from Redfin.

While inventory will play a strong role in the second half of 2021, we’re seeing that the rise and fall of interest rates will also have a large impact on activity, as evidenced in 2 articles, written 2 weeks apart.

  • The first article, posted on July 15th, points to an increase in loan applications as rates drop
  • The second article, written just a week later, states that applications stalled as interest rates rose. 

The real estate industry will continue to watch trends and predictions on the interest rates over the coming months. Here is a helpful Bankrate article with some predictions on interest rates.

Navigating these unchartered waters while under the pressure of buying or selling a home can be overwhelming. The right Realtor can help you achieve your goals in this fast-moving and sometimes complicated market. 

As always, if you are thinking of buying or selling, contact your favorite LW Reedy Agent to help guide your decisions.  

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