On July 20 the Illinois Association of Realtors is going to pretty much tell you what I'm telling you now: June home sales for Chicago were down 28.5% from last year. Given that the government mucked up the housing market last year with their lame Kcash For Shacks (home buyer tax credit) program this is no surprise. June 2010 home sales in Chicago skyrocketed as people scrambled to feed at the government trough before it was taken away. So this year over year decline was totally expected and, furthermore, we expect July to actually show an increase over last year just because activity died last year after the June feeding frenzy.
So a bad June comparison doesn't exactly qualify as summer "doldrums". What does qualify is what is going on with contract activity, a leading indicator of sales by about a month or two - the normal closing time. Look at the graph below and you will see that a) 2011 is not experiencing the normal seasonal uptick like we did in 2009 and most normal years and b) June contract activity is falling short of even 2009 (ignore 2010 because it was all dorked up), which I think may put it around 1997 activity levels.
Meanwhile, check out the trend in distressed home sales as a percentage of total sales below. That percentage has been running higher than both 2009 and 2010 all year, peaking above 50% in the early part of the year. The decline in the last few months is the normal seasonal pattern as more "normal" homes come on the market as part of the usual spring and summer selling season. One thing to note about 2010 is that the percent distressed sales in the first half of the year was depressed as a result of the incentive to get a deal done no matter what the cost but then the percent was elevated in the last half of the year as only extreme bargain hunters were left in the market.
So it looks pretty grim - for sellers and realtors at least. But as I'll explain on Monday there is actually one bright spot out there for sellers.