Zillow joined the fray of optimism that has swept over real estate analysis the past few weeks with its latest Real Estate Market Report, stating that not only did housing values bottom in February of this year, but they have also risen for four consecutive months and posted their first annual increase in nearly than five years.
The news was similarly positive for Chicago, which Zillow surveyed extensively for the report. Homes values in Chicago have risen 1.7 percent quarter-to-quarter, with some Chicagoland towns, such as Villa Park, Riverside, Forest Park and Palos Hills showing quarterly increases of more than 4 percent.
Stan Humphries, Zillow’s chief economist, said housing’s positive performance in the past four months suggests the market has turned for the better.
“After four months with rising home values and increasingly positive forecast data, it seems clear that the country has hit a bottom in home values,” Humphries said. “The housing recovery is holding together despite lower-than-expected job growth, indicating that it has some organic strength of its own.”
Robert Padron, an agent with RE/MAX Cityview in Edgebrook, said he has seen a pick up in demand since January, particularly for distressed properties, and because inventory has declined a bit in response to the heightened demand, many of his sellers have seen themselves in multiple-offer situations.
Non-distressed properties, Padron said, can still be a tough sell, particularly with buyers who are still in a post-boom mindset and are only interested in paying the lowest possible amount for a property, regardless of its area or condition.
Nationwide, almost one-third of the 167 metros surveyed showed annual increases in home values, and going forward, two out of every five metro areas is expected to post increases in the coming year, with Phoenix (9.9 percent) and Miami (6.1 percent) leading the charge.
Though Humphries does expect values to taper off somewhat towards the end of 2012 (he expects a 1.1 percent national appreciation from June 2012 to June 2013), he is still optimistic for the market in 2012, even in its handling of distressed properties.
“[Foreclosures] will translate into more homes on the market by the end of the year, but we think demand will rise to absorb that, particularly in markets where there are acute inventory shortages now,” Humphries said.
And that forecast is consistent with what Padron is anticipating in Chicago. Earlier in 2012, Padron said banks released quite a few distressed properties onto the market (a “tidal wave,” he called it, with most brokers receiving 100 or so properties), and as the summer buying season winds down, he said many of those properties will probably start making their way on to the market for interested buyers.