The first quarter of 2024 saw significant year-over-year median price increases in three metropolitan areas in Illinois, according to a recent report by the National Association of Realtors (NAR). The city of Kankakee experienced the highest gain in the state with prices rising by 22.0 percent, followed by Rockford at 20.1 percent, Champaign-Urbana at 20.0 percent, and Bloomington at 18.5 percent. The rise in prices can be attributed to the shrinking availability of homes in the market, leading to fewer homes being sold at higher prices.
Illinois saw an 8.9 percent increase in home prices in March compared to the previous year, with properties selling for a median price of $282,000. Despite the increase in prices, the number of homes sold decreased by 11.0 percent compared to the same period last year. More than 90 percent of metropolitan areas across the country experienced home price increases in the first quarter of 2024, with 30 percent seeing double-digit annual price appreciation. The high prices were mainly driven by the limited housing supply not meeting the full demand, coupled with high mortgage rates.
The national median price for a single-family existing home rose by 5 percent to $389,400 in the first quarter of 2024. This marked an increase from the 3.4 percent growth seen in the last quarter of 2023. In addition to the metropolitan areas in Illinois, other regions with significant price increases included Fond du Lac, Wisconsin; Johnson City, Tennessee; Racine, Wisconsin; Newark, New Jersey-Pennsylvania; New York-Jersey City-White Plains, New York-New Jersey; and Cumberland, Maryland-West Virginia. However, only a small percentage of metropolitan areas experienced home price declines in the first quarter of the year.
While the price increases were concentrated in the Northeast and Midwest, the highest home prices in the country were still found in the West, particularly in California. Despite facing the highest mortgage rates in two decades, the rise in home prices can largely be attributed to the insufficient housing supply not meeting the demand. The 30-year fixed mortgage rate ranged from 6.60 percent to 6.94 percent in the first quarter of 2024, further contributing to the overall increase in home prices. Overall, the housing market remains competitive with rising prices and limited inventory in many areas across the country.
