Click here to see chart of median sale price and days on the market for local real estate
Since June 15, Riverside has seen its two biggest residential real estate transactions in over a year. On that date, a home at 140 Herrick Road sold for $885,000, while two weeks later, on June 29, the historic Palmer home at 225 Longcommon Road sold for a $1.45 million.
Looking at numbers provided by Midwest Real Estate Data LLC, the second quarter of 2009 was a huge leap over the first quarter in terms of median home sale prices.
In the first quarter of 2009, the median home sale price in Riverside was $270,000 – and only five homes were recorded as sold in the first three months of the year.
But at the end of the second quarter, 18 more homes had sold and the median sale price was $353,000. So things are looking up, right?
Well, it’s more complicated than that.
In Riverside, Brookfield and North Riverside, median sale prices overall and the pace of sales continued to drop in the first half of 2009 compared with the same period in 2008, which was a terrible year for local real estate.
If there’s a silver lining in the ever-dropping median home sales price in all three villages, it’s that at least the rate at which prices are declining has slowed down.
Since the end of 2007 – when Riverside hit its high-water mark for median sales price at $503,500 – to the end of the second quarter of 2009, the median sale price has fallen 30.6 percent to $349,000. From the end of 2007 to the end of 2008, the loss was 19.5 percent. Since the end of 2008, median sale prices have dropped by 13.8 percent.
A similar story can be told in Brookfield, where the median sale price has dipped 16.7 percent since 2006. Since the end of 2008, the drop has been far slower, at 6.5 percent. In North Riverside, which saw median sale prices fall 21 percent since 2006, the market has stabilized the most. Since Dec. 31, the median sale price has dropped by 4.6 percent.
All three villages are also on pace for fewer sales in 2009 compared with 2008 and will log just a fraction of the number of sales each village saw during the peak years of the real estate boom.
So while things definitely picked up in the second quarter of 2009 compared with the first in Riverside, veteran real estate pros aren’t convinced it’s a turnaround.
“I haven’t seen anything like this since I started in real estate in 1986,” said Judy Jisa, owner of Burlington Realty, which is Riverside’s largest real estate office. “I don’t know when the market will come back again.”
The two big Riverside home sales in June offer little comfort, despite the price tags. The home at 140 Herrick Road sold in 2007 for $905,000 and the house at 225 Longcommon Road originally listed at $2.1 million – $675,000 more than it sold for.
Even if the pace of homes begins picking up, when will prices begin to rise again? According to Lauren Cody, an agent for Landmark Realty Group in Riverside, not until the glut of foreclosed and short-sale homes is gone.
Cody pointed to the number of homes in Riverside under contract at the end of last week. Of the 19 properties with contracts, 10 were either bank-owned, a short sale or in foreclosure.
“It’s made the market seem like it’s on an upswing, but we’re selling a lot of depreciated properties,” Cody said. “You can’t see any appreciation, in my mind, and it won’t bottom out until the short-sale and foreclosure homes slow down and we sell those.
“There’s a lot of bargain shopping out there right now.”
That doesn’t mean homes in Riverside can’t sell quickly if they aren’t in some sort of financial distress. Just ask Judy and Ray Tremmel, who sold their home in the 300 block of Longcommon Road in six days this summer. The pristine English Tudor had three showings the day after it was listed and drew two bidders. Within a week, they had a contract.
“We were prepared to wait,” said Judy Tremmel.
But they also found an agent who was willing to put the house on the market at a price where it would move.
“If you want to sell your home, you have to be realistic about pricing,” Tremmel said. “The appraiser hit it pretty much on the head,” she said, referring to the listing price.
Most properties in Riverside are taking much longer to sell. While the time on the market has come down from 2008, the average market time for a home in Riverside is still over five months. In North Riverside in the first quarter of 2009, the average market time was almost six months.
Despite numbers to the contrary, veteran North Riverside real estate agent Karen Arndt of ReMax Properties said last week that she believes things are picking up there. The difference, she said, is that sellers are much more motivated after experiencing a year of real estate decline.
“Sellers are much more compliant to reality this summer than they were last summer,” Arndt said. “My opinion is that the bottom is out, but this is territorial. Where I work, in North Riverside, Brookfield and Lyons, I think it has.”
In Brookfield, where the average time on the market for a property was about 3.5 months in the first half of 2009, Glenn Failla of Failla Realty agreed with Arndt’s assessment and said back in May that the Brookfield’s real estate prices had hit bottom.
They may well have done just that. At the end of the first quarter of 2009, the median sale price in Brookfield had fallen below the $200,000 mark to $197,500. By the end of the second quarter, the median price was back up to $229,000 for the year.
“It’s nowhere near the heyday, but people out there are buying,” Failla said.
In Riverside, however, the outlook isn’t as sunny.
“Personally, I don’t see any resurgence until 2010 unless the economy shows any increase,” Cody said.
Jisa said she couldn’t predict when home prices would begin to rebound. She did, however, have an interesting take on the way the local real estate market has changed since the go-go years during the first six or seven years of the decade.
Homes aren’t viewed as short-term investments that can reap huge returns anymore.
“I think it’s going back to what it was when I first started,” Jisa said. “People didn’t buy a house for an investment. It was the house they were going to live in for the rest of their lives.
“Those are the people who are buying houses now.”
Going down: The median sale price of single family homes in Riverside, Brookfield and North Riverside continued to decline during the first half of 2009. However, homes started to sell more quickly in Brookfield and Riverside during 2009 compared to 2008. In North Riverside, the average length of time on the market increased in the first half of 2009.
Source: Midwest Real Estate Data LLC