By Dennis Rodkin

Crain’s Chicago Business

October 24, 2017

2017.10.24 Crains-New-home sales plunge in third quarter-PICTUREPhoto by Pulte Homes and Del Webb Communities of Illinois This newly built house on Silverleaf Street in Naperville sold in August for about $474,000.

A sharp drop in new-home sales in the third quarter puts the Chicago area on pace to finish the year down 5.5 percent, according to a report.

Builders sold 756 new homes in the 10-county area in the third quarter, according to a report from Tracy Cross & Associates, which tracks sales in developments of 12 units or more. That’s about 26 percent below the sales volume in the third quarter last year and the lowest number of third-quarter sales since 2011, according to the report.

Builders are on track to sell 3,849 new homes in the region this year, said Tracy Cross, principal of the Schaumburg firm. They sold 4,075 last year.

“The main problem is supply,” Cross said.

During the third quarter of 2005, he said, there were 1,199 active developments selling homes in the region, while there were 313 at the same time this year, and the typical project is considerably smaller now.

Sales fell in both the city and suburbs in the third quarter. There were 679 suburban sales, off more than 25 percent from a year earlier. There were 77 in the city, down 33 percent.

Cross’ reports do not capture homes that builders put up singly or in groups of fewer than 12 on infill lots, such as replacements for teardowns in the city and suburbs.

Chicago-area new home sales also declined in the second quarter from the year-earlier period after four consecutive quarters that showed increases.

New-home sales also have been down nationwide recently. August sales were down 1.2 percent from a year earlier, the U.S. Census Bureau and the Department of Housing and Urban Development reported last month. September data will be released tomorrow.

 

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