ROCKFORD — Single-family home prices and sales figures hit all-time highs in the region to start the new year despite steadily rising interest rates.
While the local real estate market is buoyant, inventory remains low and consumer budgets are being hit by inflation, according to Rockford Area Realtors.
The three-month rolling average price for a property in Winnebago, Boone and Ogle counties rose to $166,493 in January. This represents a 5.4% increase from figures for the same month in 2021. It was also the highest average price ever paid in January for a home in the Tri-County area.
Total sales volume increased nearly 4% to 329 properties sold in January, compared to 317 homes sold in the same month last year.
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“Our values in the Rockford area are still incredible when you look at state pricing and national pricing,” said Mike Lunde of Gambino Realtors. “We’re a really good value even at an average price of $170,000. We see people all the time coming from Chicago moving here and buying a house and having no debt on it. So as people see how we are a great value, they take advantage of it.”
The latest sales figures for the region contrast sharply with national totals.
Pending home sales fell nearly 6% in January, according to the National Association of Realtors.
Of the four major US regions, only the West showed an increase in contract activity month over month.
As home prices in the area continue to rise due to a lack of inventory, the number of new listings — a measure of sellers putting homes on the market — rose more than 17% in January.
“We are excited to see the jump in new listings in January,” Rockford Area Realtors CEO Conor Brown said in a press release. “Over the past few months, enrollment has been only slightly ahead of the previous year’s numbers. Otherwise, they have moved below historical levels. This limited availability of homes is an ongoing challenge for successful buyers to find and close on a home. »
Mortgage rates continued to climb steadily last month, with some indexes exceeding 4%.
The average 30-year fixed-rate mortgage rose to 3.92% for the week ending February 17. This is the highest level since May 2019.
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While mortgage rates are on the rise, they’re still a bargain, according to Pioneer realtor Ginger Sreenan.
“Anytime I see single-digit interest rates, it means it’s always a wonderful time to buy,” Sreenan said. “Current rates are still around four percent. As far as I’m concerned, that’s a wonderful buying rate. Rents have definitely gone up, so buyers – especially first-time buyers – really want to get in on the game. . »
As rates rise even modestly, they impact monthly mortgage payment and overall affordability, according to Brown.
“The good news is that even if rates go up, they’re still worth taking advantage of,” he said. “Historical data shows that today’s rate is still well below the average for each of the past five decades. If you’re looking to buy a home, rising mortgage rates should be an incentive to act sooner rather than later.