"So here we are! The bubble has burst --finally! -- and it's ugly out there."
Well it's Sunday morning December 30, 2007, there's a very interesting article in the Chicago Sun-Times real estate section,written by Sally Duros. entitled Goodbye 2007, hello 2008.
The point of the article is that as bad as it is out there, things in Chicago are not near as bad as we find in California, Florida and New York. I agree with that, now on to some of the stated statistics.
"To prove a point, the latest data from Standard & Poor's/Case-Shiller home price index shows home prices falling nationally in October for the 10th consecutive month, posting their largest monthly drop since early 1991. But here in Chicago, home prices dropped only 3.2% in October 2007 from October of 2006. This was less than half the record national rate of 6.7%"
Now does this mean your house has only dropped 3.2%? Unfortunately, No.
Statistics are great, they deal with what is called a "Sample" of a "Population", In this case the sample is Chicago homes out of the population of national real estate.
In Chicagoland most real estate has declined in value in the last year, some is still stable and some sub-markets may still be appreciating. The problem with a large sample is it does not zero in on your neighborhood and your property type, which may have reacted to these times in a much different way than the whole of Chicagoland.
So starting January 1, 2008, I will examine the Chicagoland real estate market at the neighborhood level. My source will be the data from the Northern Illinois Multiple Listing Service. Using this neighborhood level sample I will report on Average Sales Prices, Average Days on Market, Absorption Rate, Current Active Listings and the Number of Months of Unsold Inventory.
These detailed statistics will give you a better insight into your neighborhood, and what to expect in 2008.
Happy New Year -- and its ugly out there.