When the Illinois Association of Realtors releases the November home sales numbers for Chicago and Illinois in two weeks they will once again show a significant increase in closings over last year - this time approximately 20.3% higher. However, as I've pointed out on numerous occasions, it's not really appropriate to compare 2011 sales to last year's artificially depressed levels. It's not meaningful to beat those numbers.
What is meaningful is that for the first time this year closings were higher than the depressed levels of 2008. In fact, they were 25.9% higher. They were also 4.9% higher than the previous month, which is unusual because normally November sales are lower than October sales. Combined with the record low inventory levels, this could represent a turning point for the Chicago housing market. However, we need to see this confirmed in increasing home prices and to put things in perspective the November home sales were about where they were back in 1997.
As for the mix of distressed sales...it remains very high at 43.8%. Looks like another record high for this time of year.
Also supporting the notion of a Chicago housing market that is turning the corner is the contract activity, which usually precedes closings by about 1 month. During the last few months home contract activity in Chicago has been very strong and trending well above 2008 levels and it just started to surpass 2009 levels this last month. As I've previously mentioned, some of these contracts seem to be going into a black hole where they idle for months on end but eventually they will probably materialize as closed sales, which is going to drive the sales numbers even higher.