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Home sales strong in 2016, PAAR reports

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Historically low interest rates continued attracting buyers to the local real estate market in 2016 and year-end sales nearly matched those of 2015, according to the Peoria Area Association of Realtors.

There were 5,454 homes sold in 2016, just 0.8 percent below the 5,499 units sold the previous year, which was the fourth consecutive year sales rose.

Fourth quarter home sales edged upwards 1.3 percent to 1,190 units vs. 1,175 sales in 2015, the association reported.

Locally, newly constructed homes sold through PAAR MLS totaled 1,343 units compared with 1,312 in 2015.

The median home sale price stood at $118,000, down 1.7 percent from $120,000 in 2015. The average sales price was $141,757, down 2.8 percent from $145,791. It took less time to sell a home in 2016 in the Peoria area; the average was 83 days, compared with 86 days in 2015. The price range that averaged the shortest days on market was the $125,001 to $175,000 at 72 days, the association said.

Seller activity increased 0.6 percent to 8,761 new listings, compared with 8,711 in 2015. There were fewer homes to select from with the inventory of homes for sale through December, down 2.3 percent to 2,503 from 2,563 in December of 2015.

“Homebuyer demand kept sales steady in the Peoria area to end the year on a strong pace even while supply was decreasing. Fourth quarter sales numbers for the Peoria area were up 1.3 percent from a year ago and November sales alone were up 23 percent,” said Jana Heffron, president of the Peoria Area Association of Realtors. “Buyers were able to ride the tailwind of historically low mortgage rates for a much longer period of time than anticipated. We may see more entry-level and move-up buyers eager to purchase in the first quarter in order to lock in rates before they inch any higher.”

This past week, mortgage rates moved in a downward fashion for the third consecutive week with the 30-year fixed rate mortgage averaging 4.09 percent according to the Federal Home Loan Mortgage Corporation. National Association of Realtors Chief Economist Lawrence Yun predicts conforming loan rates will approach 4.6 percent by the end of 2017. Yun hopes continued job growth, any economic stimulus from the new administration and more millennials reaching their prime buying years will keep demand for the most part on solid footing.

Peoria area homes with the largest gain in sales activity in December were those in the $175,001 to $225,000 price range, increasing 5.7 percent.  A few of the areas in the Peoria region reporting home sale gains in 2016 included Edwards, up 17.2 percent; East Peoria, up 3.4 percent; Peoria Heights, up 9.6 percent; Tazewell County, up 1.7 percent and Woodford County up 2.6 percent.

“An improving national economy should be a positive sign for the 2017 Peoria area housing market, although local expansion or reductions in workforce announcements factor into the consumer confidence and decision making in housing,” said Heffron.  “One of the biggest challenges will be to make sure that the supply of inventory increases to keep pace with the demand of buyers in the market searching for properties in price categories where supply has tightened.

“The Greater Peoria region is very fortunate to have a diverse inventory of properties from affordable housing priced below $75,000 to higher priced properties above $500,000. From a seller standpoint, pricing a property is extremely important for a timely sale but is critical right now for upper price range properties where there are fewer sales. Hot price ranges currently exist below $125,000 and in the $225,000-$300,000 category.”

According to realtor.com, Midwestern cities continue to be hotbeds for millennial buyers going into 2017. A recent published study by SmartAsset looked at data on under 35-homeownership rates in the 200 largest U.S. cities to identify where millennials are buying homes. The study found Peoria, Ill. is popular for millennial buyers. From 2006-2015, the report found the under 35 homeownership rate jumped 8 percent in the Peoria market, the highest increase in the SmartAsset study. The data analyzed was from the U.S. Census Bureau’s 2015 and 2006-1year American Community Surveys.

Millennials are expected to share about 33 percent of the market while baby boomers are expected to make up 30 percent of buyers in 2017.

“Millennials and first time buyers have the unique opportunity to get into the housing market affordably in the Peoria region. One of the greatest contributors to consumer wealth has been the growth of home equity. Renters are missing out on opportunities to begin building their financial equity through homeownership,” said Heffron.

 Peoria Area Association of REALTORS®

      YEAR-END SALES, AVErage & Median Sales Prices

 

YEAR HOME SALES AVE. SALE PRICE MEDIAN
2016 5,454 $141,757 $118,000

2015

     2014

5,499

5,142

$145,791

$145,449

$120,000

$119,900

2013 4,946 $141,215 $118,000
2012 4,928 $146,292 $121,900
2011 4,210 $137,345 $115,000
2010 4,318 $136,829 $113,000
2009 4,491 $134,304 $114,500
2008 5,142 $138,650 $114,646
2007 5,820 $139,663 $115,000
2006 6,139 $135,675 $110,000
2005 6,152 $129,930
2004 5,795 $119,342
2003 5,525 $114,807
2002 5,002 $106,592
2001 4,737 $107,951
2000 4,579 $102,896
1999 4,190 $103,200
1998 4,279 $  98,993
1997 3,744 $  95,557
1996 3,407 $  90,046
1995 3,273 $  84,835
1994 3,309 $  81,219
1993 3,348 $  74,395
1992 3,070 $  71,328
1991 2,992 $  67,931
1990 3,173 $  61,798
1989 3,246 $  57,050
1988 3,380 $  53,350
1987 2,801 $  52,135
1986 2,347 $  52,225
1985 1,538 $  52,566
1984 1,686 $  55,400
1983 1,589 $  57,000
1982 1,239 $  61,500
1981 1,806 $  59,850
1980 2,035 $  55,941
1979 3,449 $  52,951

 

 

INVENTORY NUMBERS

                                                   4TH QUARTER BY MONTH

2016 2015 2014 2013
OCTOBER 2,987 3,058 2,820 2,663
NOVEMBER 2,875 2,845 2,719 2,412
DECEMBER 2,503 2,563 2,441 2,111

*The Lamoine Valley Board of REALTORS® merged with the Peoria Area Association of REALTORS® in May 2015. Home sales adjusted to include Lamoine Valley totals years 2014, 2015 and 2016.