Midwest home sales fall on a monthly basis in January, but improve 4 pct on 2009 sales levels

Midwest home sales figures reveal mixed picture

OMAHA, Neb. — In the Midwest, January home sales plummeted 37 percent from December’s figure, but sales were still up nearly 4 percent over the previous year, according to figures released Friday by the National Association of Realtors.

There were 54,000 sales in the 11-state region last month, and the median sales price improved more than 2 percent, to $162,700.

The Midwest sales figures were slightly weaker than the national ones. According to figures that are not seasonally adjusted, total home sales nationwide in January fell 33 percent compared with December totals, but they improved 7 percent on an annual basis. The median home price nationally gained nearly 3 percent, to $212,000.

The tax credits available to home buyers — especially the $8,000 one for first-time buyers — continue to drive activity across the Midwest.

“That’s the only thing that has spurred the market in the last six months,” said Jeff Smutek, a Realtor with Re/Max Crossroads in the Cleveland area.

Sales fell on an annual basis in 11 of the 12 major Midwestern cities tracked in the Associated Press-Re/Max Monthly Housing Report, which was also released on Friday. Cleveland had the worst month with a 22 percent drop in sales, but the city that bucked the downward trend, Chicago, posted a 28 percent increase in sales.

Median house prices increased in nine of the cities between 2009 and 2010, and even the three cities where home prices fell the declines were less than 5 percent.

The AP-Re/Max report tallies sales by all real estate agents in a metro area, regardless of company affiliation. The report covers Chicago, Cleveland, Des Moines, Detroit, Fargo, Indianapolis, Kansas City, Milwaukee, Minneapolis, Omaha, St. Louis and Wichita.

Here are some of the highlights from the region:

—Biggest sales decline: Cleveland again recorded the biggest drop in sales between January 2009 and last month, but Wichita, Indianapolis, Fargo and St. Louis all saw sales drop more than 15 percent.

Smutek said the overall sales figures for Cleveland are a bit misleading because the picture in the suburbs is much different than in the city itself.

“In the suburbs, things are down less than 20 percent,” Smutek said.

About the only people buying in the heart of Cleveland right now are investors because most people can’t get financing. Smutek said he personally had a great January, but that included a number of bank-owned home sales.

—Only sales increase: Chicago was the only city with a year-over-year sales increase in January.

Chuck Goro, who manages Coldwell Banker’s largest office in the Windy City said the market seems to have stabilized at a point where sellers feel good about what they’re getting for their homes and buyers are willing to pay those prices.

“The market is up in Chicago and everybody is excited,” Goro said.

Buyers in the Chicago area don’t seem to be waiting for the April 30 tax credit deadline to approach, he said.

—Biggest price gain: Median home prices grew in nine of the 12 cities with Detroit leading the group with a 61 percent increase.

January’s median home sales price of $62,000 in Detroit is significantly higher than the previous year, but it is 11 percent lower than December, on an unadjusted basis.

Realtors say that home price figure may be misleading because many homeowners have pulled their homes off the market because they don’t want to compete with bank foreclosure sales. Detroit’s inventory of homes fell 34 percent over the past year.

Most sellers in the market now have to sell, often for less than what they owe the bank (also known as a short sale), said Detroit Realtor Mark Walski with Remerica Hometown One.

Homes in the Detroit suburbs that sold for $350,000 a couple years ago are now going for about $250,000, Walski said.

But homes that are priced right and aren’t short sales are attracting multiple offers and moving quickly, Walski said.

“I kind of feel we’re at the bottom, and things have flattened out,” Walski said.