Top 5 Most Competitive Markets (April, 2022) | Chicago’s Western Suburbs

It’s no secret that the real estate market is ultra-competitive right now, so I thought it would be interesting to take a look at which markets are currently the most competitive in the western suburbs of Chicago. I’m Eric with Eric Andersen Homes, and this is important to consider whether you’re considering selling your current home or buying a new one. As always, it’s really important that you don’t get caught up in the hype and read the headlines or listen to the uninformed opinion of someone—agents included—but that you become familiar with the data and see what story it tells about the current state of the market. So let’s begin by looking at the data. As you can see in this slide, CoreLogic’s data shows that home values have been steadily increasing each month over the past year. This is proof of how competitive the market has been and remains to this day. Last summer, I had buyers tell me they wanted to wait until this year in the hopes that the market would cool off. The reality is, home values have only gone up since then, meaning it is more expensive today than it would have been to purchase the same home one year ago. The reason for all of the competition is basic supply and demand. As you can see here, new listings have fallen dramatically. Inventory was low when the pandemic began, and it has only become lower this year. There was a bit of a bump over the summer, but, as anyone who was out looking for a home this past summer could tell you, the market was ultra-competitive even then. The other significant factor to consider cost-wise when considering a purchase is the cost of borrowing money. Over the past three months, interest rates have risen by over one point three percent, from three point one one percent at the end of December all the way up to four point four two percent at the end of March.Looking forward to the rest of the year, Len Kiefer from Freddie Mac anticipates that interest rates will continue to rise through the rest of 2022, which should start to slow home value appreciation down. This doesn’t mean home values will start declining, it simply means that appreciation won’t be quite as high as it has been. One final point before we get to the most competitive markets in the western suburbs, and that’s the question of a possible housing bubble. Seventy seven percent of consumers and forty four percent of agents believe we are currently in a housing bubble. This is an irrational fear, and it is not based on any data. As you can see, the reason for price increases is basic supply and demand. During the housing crash, inventory levels were anywhere between a seven to almost ten months’ supply. The market was saturated with listings. Today, most markets are sitting below two months. Now, let’s turn our attention to the top five most competitive markets in the western suburbs. Coming in at number five is Oak Brook. Median sale price in Oak Brook is up to six hundred forty six thousand dollars, which is an increase of three point four percent. Median market time is down to forty eight days, a drop of forty point seven percent, and supply has dropped to four months, down forty nine point four percent. So clearly, home values in Oak Brook have risen and inventory is down, so it’s definitely a seller’s market, but their levels are much higher than the national averages we just saw, and it’s the least competitive of the five western suburbs we are considering in this video. If you’re looking for opportunity as a buyer, Oak Brook offers the most, as home values have risen the most slowly, market time is highest, as are inventory levels. The fourth most competitive market in the western suburbs is currently Burr Ridge. Home values in Burr Ridge are up seven point seven percent to a median sale price of six hundred seventy three thousand dollars. Market time has dropped to forty three days, which is a decrease of fifty seven percent. Inventory has dropped fifty five point three percent to a three point four months’ supply. Compared to Oak Brook, the appreciation rate of home values in Burr Ridge is double, though market time and inventory is only moderately lower.Coming in at number three on our list is Hinsdale. Hinsdale has the highest median sale price of the western suburbs, which is currently sitting at nine hundred twenty five thousand five hundred dollars, which is an increase in eleven point six percent. Median market time is down fifty two point four percent to thirty nine days, and supply has dropped to two point five months, or a decrease of sixty one point five percent. So clearly, Hinsdale is a very hot market right now. Their inventory has dropped the most dramatically of our top five, at least in terms of percent, and their home values have appreciated by the second-highest percentage of our top five. However, they are not the most competitive market in the western suburbs, which is what you’d probably expect given their price point. Hinsdale’s homes are the most expensive of the western suburbs, and so naturally, there is a smaller pool of buyers for those homes. However, the market is still red-hot right now in Hinsdale. That brings us to our top two most competitive western suburbs, and I’ll warn you right now, it was a photo finish. Number two on our list is Downers Grove. Downers has the lowest median sale price of the areas on our list, so you would expect a more affordable area to be a hotter market, and indeed, it is. Their home values have skyrocketed by fourteen point four percent, which is the highest on our list. Their market time is down fifty seven point six percent to fourteen days, and their supply is at one point four months, which is down fifty one point seven percent.This brings us to our number one most competitive market in the western suburbs right now, and that distinction goes to Naperville.Ah, Naperville. Now, since Naperville is currently the hottest of the western suburbs, I thought it would be fun to look at what makes Naperville so attractive. According to Niche, it is the best city to raise a family in America, and that’s out of two hundred twenty eight cities. They have also ranked them number one as being the city with the best public schools in America, and they have the number three spot in Niche’s rankings of best cities to buy a home in America.And notice, they aren’t just talking about Chicago or the western suburbs, but the entire country. OK, so on to Naperville’s stats.Naperville is the second most affordable of these five western suburbs, with a median sale price of four hundred forty nine thousand ninety three dollars. That’s an increase of nearly eleven percent, which is admittedly modest compared to some of the other suburbs we’ve seen. However, where Naperville has the highest competition is seen most clearly in their extraordinarily low market time and supply of inventory. Median market time is a ridiculously low nine days, down sixty four percent, and their supply is just above a single month, or a drop of fifty six percent. So if you’re planning on buying a home in Naperville, you’d better put on a helmet and some armor and get ready to compete, because Naperville is a full-contact sport. Frankly, all of these markets are competitive, but as you can see, the intensity level does vary. One final quick stat that you might find interesting. In Naperville, homes are selling for a median of one hundred percent of asking price. In Downers, they’re at ninety eight point six percent. Hinsdale is at ninety six point three percent, Burr Ridge is slightly higher at ninety six point seven percent, and Oak Brook is at ninety five point one percent. So those figures roughly follow what we would expect based on the competition level we’ve seen. Naperville’s homes are selling for the highest percent of asking price at one hundred, and Oak Brook sellers are getting ninety five point one percent, which is the lowest percent of asking price of these five areas, although that is still a very respectable figure. If you’re a seller and are interested in capitalizing on the current strength of the market and leveraging my experience and digital marketing expertise to get the most money from your sale, reach out to me anytime. And likewise, if you’re a buyer whose ready to compete for a home but would like to be smart about your purchase and put together a strategy to get a great home at a reasonable price, I’d love to help. I’m Eric with Eric Andersen Homes, here to remove the headache from real estate and provide expert guidance for your next purchase or sale.