By Dennis Rodkin

Crain’s Chicago Business

October 24, 2016

 

rise-in-local-new-home-sales-picturePhoto by D.R. Horton This newly built house on Chesapeake Lane in Naperville sold recently for just under $415,000.

Local new-home sales rose more than 27 percent in the third quarter, putting builders on track for their second-best year of the post-bust era, according to new data.

For the first three quarters of 2016, new-home sales are up 9.2 percent in the Chicago area compared with the same period last year, according to Tracy Cross & Associates.

“There’s a ray of hope in the numbers,” said Tracy Cross, head of the Schaumburg-based consulting firm, which compiled the data.

While the figures are still “so low” compared to the homebuilding heyday of decade ago, Cross said, “at least we’ve got our feet in the starting blocks.”

Homebuilders made 1,033 sales during the third quarter, up from 812 in the same period in 2015, according to data from Cross’ firm. The data reflect construction by “production builders” in developments larger than 20 homes; it overlooks individual homes on scattered sites, such as those being built in many Chicago neighborhoods.

For the first three quarters, the local sales total is 3,299, compared with 3,021 in the same period last year.

At the current pace of sales, builders are on track to sell about 4,136 homes in the region in 2016, which would be the best year-end total since 4,415 in 2013. From 1998 through 2006, sales totals were above 20,000 every year. Since 2010, the year-end total has been above 4,000 only once, in 2013.

This year’s third-quarter increase followed the second quarter’s year-over-year increase of 12 percent. That uptick was almost entirely the result of sales at the 92-story Vista Tower, designed by architect Jeanne Gang.

The third quarter’s strength was suburban sales, Cross said. “You had strong activity in Naperville, New Lenox, Joliet,” he said. “That’s a more traditional concentration for our region.”

Suburban new-home sales totaled 912 during the quarter, up almost 38 percent from 662 in third-quarter 2015. In the city there were 121 sales, down 19.3 percent from 150 in the same period last year.

 

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