It appears 2017 isn’t shaping up as a banner year for Chicago real estate, at least that’s the projection of the National Association of Realtors. In its recent rankings of the biggest 100 metro areas for 2017, Chicago was tabbed as having the coldest real estate market with a dead-last ranking.
In its report on the rankings, Crain’s Chicago Business noted the “double-barreled” forecast of minimal increases in both home prices and homes sold for the Chicago real estate market. Home prices are projected to rise just 1.95 percent in 2017, while home sales are expected to grow by 2.27 percent.
N.A.R. Chief Economist Jonathan Smoke noted that neither projection was last in its respective category, “but because the forecast for both was weak, Chicago ended up ranking last.”
Smoke would go on to explain some reasons for such a flat Chicago real estate market next year. This includes the city’s unemployment rate, which is well above the overall U.S. rate and is an important indicator of a cool real estate market. He added that job growth in Chicago should be solid in 2017, but still likely weaker than overall U.S. employment growth.
Nationwide, N.A.R. projects in 2017 home prices will rise 3.9 percent and home sales will rise by 1.9 percent to 5.46 million units sold.
The hottest real estate market next year is forecast to be Phoenix. The Arizona city is expected to see price growth of 5.94 percent and for home sales to jump by 7.24 percent in 2017. Analysts noted Phoenix being on top of the rankings is an interesting development. It was one of the hardest-hit cities in the country by the last housing crash, and many experts predicted it would take decades to recover. But with such solid gains expected next year, Wall St. Journal called it “another sign that the U.S. housing market is returning to full strength.”