In July, Crain’s Chicago Business published a story touting the increase in home sales in the first half of 2016 compared to the same period the year before. Sales in Forest Park saw a 36 percent rise over 2015, Oak Park sales were up 22 percent over the previous year, and River Forest rose 34 percent. With three more months of sales data to consider, local real estate professionals are facing the end of the selling season with optimistic outlooks.
For sales closed year-to-date through the end of October, the numbers paint a rosy picture for the near west suburbs. For detached, single-family homes, Forest Park closed sales increased 41.7 percent, Oak Park saw a 20.2 percent increase in closed sales over the same period in 2014, and River Forest also saw a 20.2 percent increase compared with two years ago.
Rich Gloor Jr., broker/owner of Oak Park’s Gloor Realty and Swati Saxena, broker associate of Baird & Warner in Oak Park, agree that in Oak Park and River Forest, a lot of movement can be attributed to the return of the move-up buyer.
“The condo market here and in the city has had a good effect on the local market,” said Gloor. “It’s put a lot more buyers in the market who couldn’t sell their condos before. Maybe they got to an acceptable loss — a number that made them comfortable enough to sell their condo at a loss and buy a home.”
He points to an example of the young couple from the city who bought a condo at the height of the real estate boom. With the real estate recession, they may have been stuck in the condo longer than they originally planned.
“Now, they might have two kids instead of one in a two-bedroom condo, and the market has changed enough, and they need the space enough that they’re finally able to get out to the suburbs.”
These kinds of buyers who are able to purchase their first homes in the suburbs enable those already living in starter homes to sell and buy a bigger home.
Saxena noted that a lot of local sales traffic comprises those move-up buyers who already live in a home in the area and are looking for their second, larger home.
“What I have seen is a lot of people moving up,” she said. “Once people are in the area, it is very rare that they leave for another suburb unless there is some sort of transfer out of state due to a job.”
Like Gloor, she thinks the return of better pricing has enabled people to move up.
“We’re seeing more people who have gotten their equity back and are ready to move,” she said.
The zip in one zip code
Gloor pointed out this has been an especially strong year for south Oak Park’s 60304 zip code. The neighborhood is doing well with both first-time buyers and buyers of higher-end new construction.
“We’re seeing really high prices south of the freeway,” he noted. “There’s a lot of new construction from Harlem to Oak Park Avenue, from 290 to Roosevelt. There are second-story additions and a lot of new homes. We’re seeing prices in the upper $700s right now, numbers that weren’t there before.”
That neighborhood has a strong community feeling that Gloor says a lot of first-time buyers seek out, and many people who own starter homes there want to move up to bigger homes in the same neighborhood.
The statistics reflect a strong interest from buyers who want to purchase homes in the neighborhood. According to Saxena, the 60304 zip code saw a 16.3 percent increase in the number of closed sales between 2014 and 2016, and an 11 percent increase in the median sales price for the same years.
Even though the stereotypical hot season for home sales is spring and summer, the fall has also been strong in the local market this year.
Saxena attributes some of that to the weather and some to the natural movement of people from the city to the suburbs. Calling this a great time to move, she said, “If we have a non-rainy fall, that helps sales. Good weather just makes it easier to get out and see a house. In general, the colder it gets, the more people hunker down and wait for better weather to look.”
Many buyers who plan to purchase in the suburbs in 2017, she noted, are already starting their searches now.
“We still see a lot of the typical buyers from the city, who are people with kids who come to the area for the schools and ease of commute to Chicago. It’s very appealing. The more they see now, the easier it is to make a decision when the time comes.”
Gloor said the fall has been strong at his office as well. “We’ve had 20 sales in October already, and we’re still getting new listings even now.” He believes October 2016 was stronger than October 2015 and thinks the year will finish strong.
Heading into 2017, Gloor thinks the upward trend will continue.
“We have longtime homeowners who didn’t have to move, who are now ready to downsize because they’ll make more money on the sale of their homes post-recession. We’re seeing a lot of people doing the move up to the second home. It’s a nice transition right now.”
He noted that move-up buyers are being more choosey.
“They often are looking for something on a specific block or certain area. Not a lot of them want to take on the work involved with a fixer-upper.
“I think 2017 will be another really solid year,” he added. “We should have a very healthy, slowly appreciating year for properties that are ready to move in or are new. We’re not going to see those spikes that we saw before, and that’s not a bad thing.”