27-Apr-15 – Thousands of Chicago homeowners are slowly regaining real estate value lost during the Great Recession, experts say.

Single-family homes in the Chicago area lost an average of 28 percent of their value between 2007 and 2012, when the market hit rock bottom.

Rising resale values of 2015’s spring market, however, have stuffed some hefty amounts of cash back into many beleaguered homeowner pockets, reports Illinois Association of Realtors, which noted “sharp gains in year-over-year home sales and median prices” in March.

“When adjusted for inflation, median home prices have recovered up to 79 percent of their 2008 levels statewide and 74 percent of the prior levels in the nine-county Chicago area,” noted Geoffrey J. D. Hewings (left), a University of Illinois economist who predicted it would take another one to three years for values to fully recover.

A total of 2,118 single-family homes and condominiums were sold in March 2015, up 13 percent from last year when 1,875 homes were sold. What’s more important is that the median price of a home in Chicago jumped 11.9 percent to $263,079 over March 2014 when the median price was $235,000.

“Chicago’s spring market is showing bounce with back-to-back months of sales increases signaling strengthening demand,” said Hugh Rider (right), president of Chicago Association of Realtors. CAR noted that hot city neighborhoods this spring include Albany Park, Dunning, and Near West Side, located northwest of the Loop, along with Ashburn and West Lawn, southwest of the Loop.

“Even with fewer homes on the market, we’re seeing determined buyers finding their ideal home,” Rider said. “This increased demand is moving median sales prices higher, offering homeowners an incentive.”

Rock bottom home loan rates also helped buyers get off the fence. Freddie Mac reported benchmark 30-year fixed mortgage rates averaged 3.65 percent in late April, compared with 4.33 percent a year ago.

In the nine-county Chicago area, homes and condo sales in March 2015 totaled 8,158 units, an increase of 11.5 percent from the 7,314 sold in March 2014. The median home and condo price in March in the Chicago area was $204,000, up 16.6 percent from $175,000 in March 2014.

“Buyers are becoming quite aggressive when it comes to shopping for a home this spring,” said Jim Kinney (left), president of Illinois Association of Realtors and vice president for luxury sales for Baird & Warner in Chicago. “The surge in sales and median prices throughout the state in March clearly shows consumers know they have to be willing to pay more as they face a slightly smaller number of homes on the market this year versus last.”

Bargain hunters shopping for foreclosures may receive a boost from a new Fannie Mae and Freddie Mac pilot program that plans to sell thousands of vacant, foreclosed homes in Chicago and suburbs. The two agencies plan to offer about 3,800 homes, condos, and two-to-four-flats for sale to qualified nonprofit groups and their developers. The worst of the blighted properties will be offered for as little as $1. Other residences that can be rehabbed likely will be sold at a discount of up to 20 percent.