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The Village of Arlington Heights
The Village of Arlington Heights is a northwestern suburb of Chicago. It is located about 25 miles northwest of downtown Chicago. A growing downtown skyline, expanding shopping areas, and new office parks attest to the Village’s vibrancy. The population of Arlington Heights in July 2007 was 73,693….a decrease of -2.7% from the 2000 U.S. Census. And even though Arlington Heights has a large population, local residents and business people will say that the village retains many small-town charms. People remain in their homes for decades, stay loyal to local merchants and display a strong spirit of community participation. Arlington Heights is the largest for a village in the United States, and it is also the twelfth largest municipality in the state of Illinois.
Arlington Heights is known for Arlington Park Race Track, home of the Arlington Million. There are currently an estimated 33,206 housing units (houses/condos) in Arlington Heights.
In the “Market Trends-Overview”, I explained where we obtain the data to identify and analyze these Market Trends and how we use this information in appraising Residential properties. For each of the individual Suburban areas, I will include a separate market analysis report for that suburb and include one or two charts to show what the trends look like for a particular Village or City in our community.
Let’s take a look at some current “market trends” for Single Family Detached residences in Arlington Heights:
The report above is the same “Market Analysis” report that I include in my residential appraisal reports. This analysis is based on the most recent data available by Midwest Real Estate Data, LLC via the “connectMLS” system. Using the sales data from the MLS (multiple listing service) is NOT all inclusive of the sales activity in an area, as all sales are not typically recorded in the MLS. The appraiser uses a combination of reasonably available information from various data sources based on its reliability such as; city/county records, real estate agents, FSBO information (For Sale By Owner), assessor’s records, recorder of deeds records and web site listing services. Also, in the analysis above, the use of the “median” sales price is used with smaller sample sizes because use of an “average” sales price can sometimes distort the sales comparisons in the year over year analysis based on one or two very high or very low sales.
So, what we’re seeing for Single Family Detached homes in Arlington Heights is:
1) There is an -8.50% decline in the median sales price for the six month period ending 10/31/2008 vs. the same six month period in 2007
2) Current six month period had 268 closed sales vs. 308 in the same six month period in 2007
3) With an absorption rate of 35.33 sales per month we are currently looking at a 12.23 month supply of homes for sale
4) Over the past 3, 6 and 12 month periods, the average “days on market” for a listing was 182 days to 200 days, with the current actives and pending listings exceeding six months
5) The sales to list ratio is currently 94.53%
Now, let’s take a look at two charts that reflect sales data for the past three+ years (01/01/2005 to 10/31/2008), again, these results are for Single Family Detached residences in Arlington Heights:
In the two charts above, we can see some areas of concern:
1) The trend would indicate that while there was a moderate increase in the average sales price from early 2006 and through 2007, the market has started to decline 4th quarter of 2007 and continued through present. There may be a little spark of a turn in average sales price as we enter the 4th quarter of 2008…. It’s something we’ll have to watch closely.
2) The trend for “number of sales” per quarter shows a fairly stable market during 2005, 2006 and 2007. However, going into 4th quarter 2007 we see a gradual decrease in the average sales price while “days on market” begin to extend up to and even beyond the six month mark and at the same time we see a greater spread in the “sales to list ratio” as some of these listings age and just linger on the market.
3) The second chart gives us a view of the “Average Days on Market” for a listing before it sells and secondly, over the same three+ year period a view of how the “Sales to List Ratio” has changed.
4) What we’re experiencing is a “declining value” market trend. With these declining values, properties are not selling as quickly and staying on the market for a longer period of time. And, consequently, the eventual sales price (as indicated in the “Sales to List Ratio”) is considerably less than the list or asking price.
Now, I’ve included the same or similar type charts for the “Attached Single Family” residence types in Arlington Heights, what we’re talking about here are the Condos and townhomes:
OK, what we’re seeing for Attached Single Family homes in Arlington Heights is:
1) There is a 9.74% increase in the median sales price for the six month period ending 10/31/2008 vs. the same six month period in 2007
2) Current six month period had 162 closed sales vs. 251 in the same six month period in 2007
3) With an absorption rate of 26.33 sales per month we are currently looking at a 18.11 month supply of homes for sale
4) Over the past 3, 6 and 12 month periods, the average “days on market” for a listing was 157 days to 169 days, while the current actives and pending listings are hovering around the six month mark
5) The sales to list ratio is currently 94.53%
Now, let’s take a look at two charts that reflect sales data for the past three+ years (01/01/2005 to 10/31/2008), again, these results are for Attached Single Family Residences in Arlington Heights:
In the chart above, we can see two areas that stand out:
1) The trend would indicate a gradual increase in average sales price from mid 2005 through the end of 2006 and then reaching a stable market value trend that started in mid-2007, began a steady increase and continuing an increasing value trend today. (because of the small number of sales in 4th quarter 2008, we’ll have to keep an eye on this current trend).
2) It is clear, however, that even with an increasing value trend, the trend for the number of sales continues to drop as we near the end of the year.
In the chart above:
1) The second chart gives us a view of the “Average Days on Market” for a listing before it sells and secondly, over the same three+ year period a view of how the “Sales to List Ratio” has changed.
2) Even though we’re seeing a pretty stable to an increasing market value trend, properties are not selling as quickly and staying on the market for a longer period of time, consequently, the eventual sales price (as indicated in the “Sales to List Ratio”) is considerably less than the list or asking price.
Conclusion:
This gives you an idea of how we look at historical data to identify and analyze market trends. For each of the individual Suburban areas, I will include a separate market analysis report for that suburb and include one or two charts to show what the trends look like for a particular Village or City in our community. Again, if you have any questions or need assistance, please call me or send me an E-mail.
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