I was in Chicago last week on family business, and spent a lot of time at my mom’s house. She lives in an upscale northern suburb that can best be described as the kind of place where people who work for plastic surgery’s favorite local magazine would live. Everyone is more or less the same, and there are very few people there like me.
And the housing market is in a sinkhole. The home across the street from Mom has been for sale for more than a year, while one three blocks away is in foreclosure and the price has been reduced by $120,000. In fact, its price is now more or less at Dallas levels –- a 3-2 for $279,000. Overall, home prices fell three percent in June, and the number of houses and condos sold in the Chicago area registered the biggest year-to-year drop in 2008.
All of which means that as bad as some of the home price news is around here, based on the research I did for this post, it’s a lot worse –- a lot, lot worse -- elsewhere.
How did this neighborhood do? The complete chart, listing sales annually from 2003, is on our web site. It tracks the 20 ZIP codes where we do magazines, and the numbers are mixed. Some areas, like 75229 (the tollway to Marsh, south of LBJ) saw a rocket-like increase for the first six months of the year, up 26 percent over 2007 and 48 percent since 2003. On the other hand, prices in 75243 in Lake Highlands fell nine percent this year, and are more or less flat since 2003.
Why the huge disparities? A couple of reasons: The areas with the biggest growth have the newest homes or substantial numbers of teardowns, which tend to be more expensive. Hence, a higher price, even if the number of homes sold doesn’t change much. I also think it shows some of the increasing socioeconomic differences in this part of Dallas. It’s not possible, as it was 10 or 20 years ago, to lump every neighborhood north of the Trinity in the same economic category. They’re becoming increasingly different, which is actually a normal part of what happens in cities. Older neighborhoods have less expensive homes.
Have we reached bottom? The experts I talked to said yes, probably. I don’t know. Nineteen of the 20 areas have seen a prorated increase in the number homes for sale in the first six months of this year, and 15 of the 20 have shown an increase in the number of days on the market. Those are not good signs. And I can't get what I saw in Chicago out of my head. My Mom’s town, which is about as upper middle class Anglo as possible, is one of the last places in the world I ever thought I’d see foreclosures. If it can happen there, it can happen anywhere.
One other note: A huge tip ‘o the cyber cap to Coldwell Banker’s Ron Burch, who put the price and sale numbers together. It was above and beyond the call of duty.
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