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Home sales stronger in second quarter

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The winter that lingered well into spring had the potential to wreak havoc on second quarter real estate sales; April sales were off from the previous year.

But recovery came in May and June and sales were up 3.2 percent in the second quarter over the same period in 2013, the Peoria Area Association of Realtors reported Tuesday. It marked the fourth consecutive year, and fifth in the last six, in which sales were higher in the second quarter than in the same period of the previous year.

There were 1,473 houses sold in the quarter, above the 1,428 sold during the April-May-June period last year and well ahead of the pace set in the first quarter, when 763 houses were sold during the region’s toughest and coldest winter in years.

“After the brutally cold weather slowed home sales activity to a crawl during the first quarter, we are happy to see the market rebound,” said Tonya Burris, president of the PAAR board of directors.

“Although sales activity did not pick up until May, nearly two months later than normal, we are now in the full swing of the summer sales season and have caught up with 2013. Activity is picking up in the upper price tiers of $500,001 and above with the number of sales increasing 21.5 percent in the second quarter. Rents continue to climb, making buying a home a good value, and interest rates are generally lower than a year ago, to the surprise of some and the delight of others,” Burris said.

She said that while continued low interest rates as well as some new financing programs have been a key factor in strong sales, another is pent-up demand. “We went through such a cold winter, people were ready to get out. And with the pent-up energy and the pent-up demand, we’re seeing a lot of rebirth in all of our communities,” she said.

Broken down, April sales of 389 were down from 408 in 2013, but May saw 529 sales, compared with 523 in 2013, and June was up 11.7 percent from a year earlier with 555 sales, compared with 497.

The average sales prices increased 3.5 percent, from $147,301 in the second quarter of 2013 to $152,384, largely because of higher sales in higher price ranges. The median sales price was up from $125,000 last year to $126,825, or 1.5 percent, the association said.

Inventories stayed low at 2,513, making it more of a seller’s market in that it is more difficult for some buyers to find the right home. Still, houses were on the market an average of 88 days in the quarter, compared with 84 days last year.

Burris said the region will likely see an influx of homes on the market in the coming year or so as new construction is up considerably. A large percentage of the new construction is rebuilding in Washington, East Peoria and Pekin after the tornadoes of Nov. 17, 2013 that wiped out more than 1,500 houses. She said many houses for sale at that time were taken off the market to be rented to tornado victims. “When they are ready to move into the rebuilt houses, those they’ve been renting will likely go back on the market,” she said.

Burris said the rebuilding from last November’s storms tends to skew the regional new construction picture, which appears to be booming. That would normally signify economic recovery and growth. “We are seeing economic improvement, though. Things are moving. I don’t know yet what to expect for the third quarter but it is starting out well and I expect it will be in the same range as a year ago because we are in what is typically our busiest time of the year,” she said.

 

About the Author
Paul Gordon is the editor of The Peorian after spending 29 years of indentured servitude at the Peoria Journal Star. He’s an award-winning writer, raconteur and song-and-dance man. He also went to a high school whose team name is the Alices (that’s Vincennes Lincoln High School in Indiana; you can look it up).