Are There Enough Homes for Sale in Winnetka, Wilmette, and the North Shore

I have been reading many reports of low housing inventory in certain parts of the country.  California comes to mind - a strong seller's market with multiple offers on every property.

From DW News:

 "Low inventory has been cited by many analysts as a concern for the housing market in 2016 as the market continues to heal from the foreclosure crisis which began nearly eight years ago."

From Housing Wire:

“A lack of housing inventory continues to drive developments in the market. As demand has slowly recovered, low inventory levels have weighed on home sales and put upwards pressure on house price,” the report said."

But as we all know, housing is local.  Everything about housing - pricing, sales, trends, market time is local.  Here, Winnetka, Wilmette, Kenilworth, Glencoe, and Northfield are not experiencing low inventory. Wilmette, as in the past several years, continues to show the strongest numbers, but even there inventory is higher than before.

This chart shows the number of new listings taken in January of 2015 vs January 2016.

North Shore Home Sales

The numbers have increased substantially this year over last year in all villages except Northfield. Winnetka and Glencoe have almost double the number of new homes entering the marketplace. Wilmette has a 57% increase, and Kenilworth a 50% increase.

Getting even more local - each town has its own distinct sales data.  See the difference in absorption rates* for each village:

Winnetka:  8.3 months

Wilmette:  4 months

Kenilworth:  16 months

Northfield:  5 months

Glencoe:  6.5 months

An absorption calendar looks like this:

Absorption Rat Chart

Absorption Rat Chart

Winnetka is still in a balanced market but tipping toward a buyer's market.

Wilmette is in a seller's market - and has been for around 2 years.

Kenilworth is in an extreme buyer's market with long market times.

Northfield is doing well and making up for lost time due to the Willow Road reconstruction.

Glencoe is right at a balanced market.

But!  January has started off sluggishly and some of the normal demographic that we see in the North Shore has not been buying.  The Millenials - who we've come to hear so much about - are not in a hurry to buy.  They are continuing to rent partly because it's who they are and partly due to large debts they carry.

Some members of the earlier generation, the Gen Xrs, are not opting to take the traditional "path" to suburbia.  Families with multiple children are staying downtown and finding good school options.

All this plus an electrified election year and the inevitable effect on real estate is not positive.

Remember that almost everything you read is nationally based.  Reports on prices going up or sales going down are not necessarily what is going on in the North Shore. Think of it like this:  the weatherman says it's going to rain in Chicagoland.  You look out your window and see sunshine.  It's the same thing with real estate statistics.  Wilmette and Winnetka are neighbors yet show a very different set of numbers relating to real estate - just like sun and rain.

*absorption rate:  the number of months it would take for all the inventory in an area to sell if no new listings came on the market.

Filed under: Real Estate

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