Skip To Content

Why Don’t Rising Rates Affect Home Prices?

Here’s a look at the latest data from the Chicagoland area market.

As interest rates continue to climb, we’ve been getting a lot of questions from clients. Are these mortgage rates going to crash the real estate market in Chicago? Should buyers wait a little longer before purchasing in case prices decrease? The best way to gain some clarity on what’s going on in the market is to look at the aggregated data pulled from the MLS. Today I’ll share what I’ve found.

In the area from Edgewater down to the South Loop, single-family home sales rose by 9.2% even though interest rates have gone up so much. The median time on the market for this same class of homes is way down, having dropped by 57.4% since April of last year.

So why is this happening even though rates are going up and affordability is declining? It’s because inventory is still very low. Single-family homes are being gobbled up right and left.

We currently only have around 2.3 months of supply in the Chicagoland area, so if no new listings hit the market, we’d sell out of what we have in 2.3 months.

Most likely, prices will remain the same, and inventory will continue to stay low.”

In terms of condos, prices are quite flat in the Chicagoland area. Their market times are down 7.5%, which is to be expected—condo inventory is down 45%. Contracts are up by 10%, and closed sales are up by almost 30% over last year.

I don’t have a crystal ball to tell me what the future will bring, but we think the market may slow down a little. Most likely, prices will remain the same, and inventory will continue to stay low.

If you’re looking to buy or sell real estate, or if you have any questions, don’t hesitate to give us a call or send us an email. We’d love to help you.

Check out these links for more specific data:

Single Family Median Sales Price 

Single Family Median Market Time

Single Family Supply 

Single Family Under Contract

Single Family Closed Sales

Condo Median Sales Price 

Condo Median Market Time

Condo Supply 

Condo Under Contract

Condo Closed Sales

Trackback from your site.

John Lyons

Tired of traveling week-in and week-out for his corporate job, John Lyons decided to start his own real estate business. Lyons could not have predicted how well his background would prepare him for a career in real estate. His journey has been a long and successful one. After graduating from Indiana University in 2001, he took a job selling copiers at Minolta Business Solutions. After building an impressive track record there, he was hired by BrainLAB, Inc. to sell image guides surgical systems. He quickly rose to become one of the top sales representatives for the company. Seven years later, he was hired by Midwest director of sales IMRIS, for their intraoperative MRI and integrated operating room solutions. Now he has a new outlet for his sales abilities: real estate. A Chicago Association of Realtors Top Producer and recipient of Baird and Warner’s Founder’s Club award for the past four years, Lyons had a record 2018, selling more than 11.7 million in real estate. This marked an 18 percent increase over his 2017 numbers. “I was able to accomplish this through daily prospecting and providing a high-level of service for my clients,” he says. In testimonials, his clients say he is patient, trustworthy, personable, knowledgeable, and professional. “Each and every client is so different,” he says. “It’s important to truly understand their needs so you can best serve them. Listening build trust, which is so incredibly important in our business.” A member of the Lakeview Chamber of Commerce, he assist clients in a variety of neighborhoods, including the Near North Side, Lincoln Park, Lake View, Uptown, Ravenswood, Logan Square, West Town, and the Loop. He is quick to admit the best education he has ever received was from his 6 years of service in the United States Marine Corps. Lyons donates $200 per transaction to the Neonatal Intensive Care Unit at Lurie Children’s Hospital. “I am running the Chicago Marathon in 2019 for Lurie Children’s Hospital,” he says. “I have a lofty goal this year, to qualify for the Boston Marathon a second time. Since the beginning of the year, I have been spending at least four hours a week training for the October 13 race.” Results matter, here are John's Listing Numbers: Average list to sell ratio - 98.2% Average days to closing - 52 Listings taken to listings sold - 99%

Leave a Reply