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Champaign County Home Sales Slip 3.9 Percent in May

Median Home Sale Price Up 5.8 Percent

Home sales in Champaign County remained stubborn for the second consecutive month in May as supply levels were off slightly over a year ago, although prices continue to gain traction, according to the Champaign County Association of REALTORS®.  The total number of home sold in Champaign County decreased 3.9 percent to 271 home sales as compared to 282 home sales in May 2016. The year-to-date total number of homes sold is down slightly, off 2.6 percent to 903 sales through May as compared to 927 sales a year ago.

            For the month of May 2017, the median home sale price (for all single-family homes and condominiums) was $155,000 up 5.8 percent from $146,500 in May 2016.

            The year-to-date through May 2017 median home sale price stood at $149,000, up 2.8 percent from $145,000 over the same period a year ago. The median is a typical market price where half the homes sold for more, half sold for less. The average home sale price stood at $181,808, up 5.9 percent in May 2017 from $171,602 a year ago.

            “Low mortgage rates are still triggering more buyer demand in this market but some buyers are finding it taking a bit longer to find the right property that suits their prerequisites. The number of new listings and inventory of homes for sale continue to decrease in the Champaign market area,” said Jim Waller, president of the Champaign County Association of REALTORS®. “REALTORS® report inventory levels and strong buyer demand is leading to more multiple offer situations in this hot spring/summer selling market and buyers have to proceed quickly on their offer if they find the home they wish to purchase.”

            As of June 15th, there were 124 sales reported for May in the city of Champaign, 60 sales in Urbana, 23 sales in Mahomet and 14 sales in Savoy. There are currently 918 listings on the market in Champaign County. The average number of days it took to sell a home was 61 days, down from 69 days a year ago.

            The average 30-year fixed rate mortgage for the month of May was 4.01 percent, according to the Federal Home Loan Mortgage Corporation, up from 3.60 percent in May 2016 and down from 4.04 percent in April 2017.

            On June 14th, the Federal Reserve acted to raise the federal funds rate a quarter of a percentage point to 1 to 1-1/4 percent. According to Lawrence Yun, chief economist for the National Association of REALTORS®, “The latest rate hike is partly justified from ongoing economic expansion and also a steadily falling unemployment rate. However, the Federal Reserve should be mindful of the lower than expected rate of inflation and the consequent low interest rates on long-dated bonds, like 10-year Treasury and 30-year mortgage rates. An inversion in interest rates of short-term fed funds being higher than long-term bond yields can easily pull down the economy into a recession. We are getting closer to that inversion point.”

Dr. Geoffrey J. D. Hewings, Director of the Regional Economics Applications Laboratory at the University of Illinois reports the median price forecast indicates moderate annual growth in both Illinois and the Chicago PMSA for May, June and July.


“While sales will continue the usual early summer upward growth, there are some sharp differences in the forecasts for median prices. The forecasts for median price indicate continued positive changes, but the REAL Housing Price Index (HPI), which compares specific housing characteristics, suggests declines and may also be reflecting the employment losses in the state over the past two months,” said Hewings.

Fannie Mae also announced policy changes this month to aid millennial homebuyers especially those that have remained locked out of homeownership by high debt-to-income ratios and student loan debt. Fannie Mae announced beginning July 29th, they will accept borrowers with debt-to-income ratios as high as 50 percent, up from 45 percent previously. “Young adults are finding it difficult to save money for down payments, qualify for a mortgage and afford mortgage payments. Program adjustments will open lending to more potential buyers who meet credit score and loan standard qualifications,” said Waller.

“Some sellers remain skittish about putting their homes on the market, perhaps given in part they have concerns they might not find the right replacement home; overall this trend leads to a tightening of the market in terms of inventory. But right now, we are seeing more of a seller’s market with reduction in housing inventory as demand still remains strong from buyers who are eager to purchase and are in the market right now searching for that right home. That means for sellers this could be a prime opportunity to sell their home.”

The Champaign County Association of REALTORS® is a voluntary trade organization serving Champaign County and surrounding areas and is a leading resource for its 473 REALTOR® members and an advocate for homeownership and private property rights. Statistics are from residential sales within Champaign County. Data compiled by Midwest Real Estate Data, LLC as available on June 15, 2017.

Wednesday, June 21, 2017/Categories: News Releases