Prices trending up in Chicago's housing market

After the S&P/Case-Shiller Index was released at the end of August, media outlets were flooded with reports on the state of local housing markets, with Chicago being no exception. The Index revealed that Chicago home prices rose 4.6 percent on average between the months of May and June, which was the third largest increase in the country after the metros of Detroit and Minneapolis, according to The Associated Press. Suburban Life Publications revealed that Chicago's increase is the largest the city has seen since the index began in 1987.

Much attention has been given to the fact that Chicago is among a handful of the top 20 metros that did not demonstrate year-over-year price gains from June 2011, along with Atlanta, Las Vegas, Los Angeles, New York and San Diego. The index revealed that Chicago home prices are down 1.7 percent when compared with July 2011.

However, Chicago's rise on a monthly basis is significant and worthy of attention. The source revealed that the substantial increase in Chicago area home values experienced in June came just three months after prices reached their lowest value in a period of 11 years. The only two metros to outpace Chicago's month-over-month rise in home values were Detroit, which showed a 6 percent increase, and Minneapolis, which just barely beat out Chicago with a 4.8 percent increase.

Suburban Life Publications revealed that according to a report released by an Illinois association, more than 8,500 homes were sold in the Chicago area in the month of July, which was a 29 percent increase over July 2011. The source additionally reported that while a large portion of Chicago counties have shown declining home prices, there have been reports of increases as well. For example, DuPage County reported that the median home price increased by 1.1 percent in the July, to $220,000.

A recent article in the Chicago Tribune noted that the recent dips in asking prices for homes for sale in Chicago in combination with skyrocketing apartment rents has created a market atmosphere in which it is common to see shorter times for homes remaining on the market, multiple offers and even bidding wars. This market atmosphere has been observed by the Tribune as contributing to higher levels of buyer anxiety.