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RE/MAX Luxury Report on Metro Chicago Real Estate:$1 Million-Plus Home Market Strengthened in 2017
The market for $1-million-plus homes in the seven-county metropolitan Chicago area showed solid improvement in 2017. Sales gained while inventory fell.
The median sales price for the full year slipped 1.9 percent to $1.3 million, and the average time that a luxury home sold in 2017 spent on the market was 169 days, four days longer than in 2016.
"Much of the decline in the median price can be attributed to a shift in market activity in Chicago," said Jeff LaGrange, Vice President, RE/MAX Northern Illinois Region. The number of luxury home sales in the $1 million-to-$2 million range increased by 21 percent, but homes that sold for at least $3 million decreased by 6.3 percent in 2017.
"It is also encouraging to see the supply of $1-million-plus homes decline over the course of 2017," he said. "At the end of 2016, we had slightly more than a year's supply of luxury listings on the market. By the end of 2017, that had dropped to about 9.5 months of supply, which is still substantial but a welcome reduction and a trend we hope continues in 2018."
With all the inventory decline concentrated in the suburbs, the city inventory of luxury homes actually rose by six units to 810, which represented a 7.3-month supply.
"The luxury market remains quite buyer friendly," noted LaGrange, "with steady prices and an ample supply of listings among which buyers can choose."
City Luxury Market
"Luxury sales in the city were up sharply in 2017, gaining 18 percent to 1,332 units," said LaGrange. The median sales price dipped 1.7 percent to just under $1.35 million. Average market time for those homes was 136 days, three days longer than during the prior year.
Attached-home sales in the city were particularly brisk. This category, which includes condominium apartments and townhouses, saw sales rise 32.9 percent to 647 units, while average market time fell from 125 to 117 days. The median sales price slipped 2.4 percent to $1,318,000, reflecting at least in part the 26.4 percent growth in luxury attached-home inventory.
One important development in 2017 was that two communities which had seen relatively small numbers of luxury attached units sold in prior years registered substantial increases. The Near West Side generated 45 luxury attached sales in 2017, up from just 17 in 2016 and 16 in 2015. The story was similar in LakeView, where there were 39 sales last year, up from 22 in 2016.
"Another major factor in the attached luxury market was the impact of new construction, which accounted for 132 sales in 2017, or 20.4 percent of the total," said LaGrange. That compares to 71 new construction sales in 2016 representing a 14.6 percent share.
The Near North Side remained the leader in the attached luxury category with 320 sales, representing a 16.8 percent increase. Other leading areas for luxury attached sales were Lincoln Park with 128 sales, a 75.3 percent increase; the Loop with 59 sales equating to a 1.7 percent increase, and the Near South Side with 40 sales, a gain of 25 percent.
Sales of single-family homes totaled 685 units in the city, 6.7 percent more than in 2016, and their median price was $1.36 million, a 1.9 percent decline. Year-end inventory was down 22.6 percent to 326 units.
The sales of luxury single-family homes were concentrated in eight city community areas, primarily on the north and northwest sides. Topping the list was Lincoln Park, which had 177 sales, followed by NorthCenter, where luxury sales totaled 152 homes. Next were LakeView with 110 sales, WestTown with 94, Logan Square with 45, Lincoln Square with 28, the Near North Side with 23 and Uptown with 14.
Luxury detached sales rose most sharply in NorthCenter, up 26.7 percent, and WestTown, up 22.1 percent. Of the top eight communities, only the Near North Side had fewer sales in 2017 than in 2016.
Suburban Luxury Market
Luxury sales in the suburbs totaled 1,326 units, up 2.5 percent from the prior year. The median sales price was $1.28 million, down 0.4 percent from 2016. Average market time was 203 days, a 10-day increase. Just nine of those suburban luxury sales were attached units.
As was the case for the prior two years, 2017 saw seven suburbs record at least 50 luxury sales, led by Winnetka with 148. Other towns topping 100 luxury sales were Hinsdale with 143, Wilmette with 109 and Lake Forest with 101. They were followed by Glenview at 76 units, Glencoe at 62 units and Evanston at 57 units.
Rounding out the top 10 suburban areas for luxury sales were Highland Park with 46, and the Barrington area and Elmhurst, each with 45.
RE/MAX Northern Illinois has been the leader in the northern Illinois real estate market since 1989 providing a full range of residential and commercial services. With more than 2,200 sales associates and 105 offices throughout the area, RE/MAX Northern Illinois has helped thousands of families with their home buying and selling needs. For more information, visit www.illinoisproperty.com or download the Illinois Property mobile real estate app.