The RE/MAX Northern Illinois network reports that its sales activity for the first half of 2006 indicates an important shift has occurred in the regional residential real estate market. 

            With the number of home sales down and inventories of homes for sale on the rise, the playing field for residential real estate has become much more level after strongly favoring sellers for the prior five or six years, according to Jim Merrion, regional director of RE/MAX Northern Illinois.

            RE/MAX closed more than $7.8 billion in real estate sales through the first six months of the year, just 5.25 percent less than last year when it achieved an all-time record for sales.

           “We are coming out of a seller’s market that began in the late 1990s and continued through 2005,” said Merrion.  “Where we are really seeing a slowing of market activity is in the sales of single-family homes, which declined 15.1 percent in the Chicago area in June according to the Illinois Association of Realtorsâ,” said Merrion.  “Condo sales held up better, but they also were down 7 percent in June.”

            The result, contends Merrion, is an extremely favorable environment for home buyers.

 “Mortgage interest rates are still under 7 percent for 30-year fixed-rate financing, and the selection of homes for sale is outstanding,” he said.  “Buyers have a much stronger bargaining position today than at any earlier point in this century.”

RE/MAX agents in Northern Illinois took 28,086 new listings during the first six months of 2006, compared to 24,775 during the same period last year, a 13.4 percent increase.

“With new listings rising and the number of homes sold declining, we estimate the inventory of homes for sale is probably up 20 to 25 percent across northern Illinois compared to a year ago,” said Merrion.

At the same time, home prices continue to rise, though more modestly than in recent years.  The average price of a home sold by RE/MAX in June was $286,709, which is 3.76 percent more than a year earlier.  For the first six months of the year, RE/MAX had an average sales price increase of 6.2 percent to $273,397 from $257,528 during the same period in 2005.

If June is an accurate indicator, the current housing market trends, which favor buyers,  could continue during the second half of the year,” said Merrion.  “However, that may not be the case.  Last year, June was notably slower than in June, 2004, but sales activity and price appreciation accelerated during the second half of the year.  I think the fall market could be stronger than recent trends suggest because first-time buyers will begin to take advantage of the improved conditions.”

           Merrion predicted that mortgage interest rates are likely to stabilize during the second half of this year as economic growth continues at a moderate pace.

RE/MAX offices lead in real estate sales across Northern Illinois and have been number one in residential sales in the Chicago metropolitan area since 1989.  In 2005, RE/MAX Northern Illinois had closed sales volume of $17.46 billion. 

            The RE/MAX network in northern Illinois consists of 4,200 associates and 166 individually owned and operated offices providing residential, relocation and commercial real estate services throughout the northern one-third of Illinois.  The Northern Illinois region is part of the RE/MAX International network, a global real estate system operating in 66 countries.  It consists of more than 6,500 independently owned offices that engage 120,000 member sales associates.

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