The residential real estate market in The Glen, Glenview, and elsewhere is in the early stages of returning to what we would recognize as normal, meaning relatively steady growth in sales and prices in most years.
Why? Well, consumer confidence has been trending up, and it is near a six year high. Interest rates remain low by historic standards. Inflation is low, the stock market has been moving higher (recently hitting an all-time high), the unemployment rate has fallen from 10% in October 2009 to 6.3% in April, and jobless claims recently hit at a 7 year low. While performance has fluctuated on a monthly and quarterly basis in each of these categories, the longer view suggests a positive environment for housing over the next several years.
This is how we got here: We had the unprecedented run-up in home sales and prices in the early-to-mid 2000’s, followed by the bust in 2007 through 2009. Steep declines were followed by less severe declines which were followed by modest improvement. Then came 2013, a year with booming sales and prices.
Sales in The Glen look strong again in 2014, though perhaps not at last year’s pace. Prices, too, continue to rise faster than normal, but they may not reach the levels of 2013. Are somewhat lower sales and price increases compared with red hot 2013 reason to worry? I would argue that for the longer term they are actually a positive sign. We’re moving toward an environment where most homes neither languish on the market for months on end nor sell immediately. This is positive because it is more sustainable. Hot markets are never sustainable. Weak markets eventually recover. We’re heading in the direction of moderate sales and pricing growth in most years, with a few bumps along the way which is…normal.
We’re not at normal yet. Home prices in The Glen are still on a strong recovery path; and we will make up a lot of lost ground this year. Then perhaps in 2015 or 2016 we’ll be back to a more sustainable real estate market, perhaps a little slower one year and a little faster the next, in line with the usual ups and downs of the economy and interest rates.
Glen homeowner and Coldwell Banker Realtor