'Thrill Is Leaving' The Chicago Condo Market

The Chicago Tribune reports on the condo market. "Condo sales, the driving force behind Chicago's housing market throughout the fall, went flat in December, the latest sign that the torrid housing market has eased to tepid. The Illinois Association of Realtors reported Wednesday that existing-condo sales in the Chicago area rose just one-tenth of 1 percent last month from December 2004." "In Chicago, single-family home sales continued their gradual decline, falling 2.7 percent in December. Statewide, it was a similar story: Single-family sales, though posting an annual record, were down 1.1 percent for the month, with their median sales price up 8.6 percent, to $203,000." "Chicago-area agents have mixed views of the market. 'It just feels completely flat,' said Pamela Ball, a North Side agent. 'There's no sense of urgency from buyers. In Edgewater, for instance, just eight condos over $300,000 were sold in all of December. The year before, there were about 15. That doesn't seem so good.'" "'There are buildings that are very flat,' said Thaddeus Wong, a principal in Chicago. Wong said one reason condos are lingering is because many lack distinctiveness from one another, a byproduct of the housing boom that has created a bumper crop of units in similar buildings with similar amenities. He also cited overpricing by 'overzealous sellers' whose perceptions are colored by memories of a hotter market." "'I wouldn't call it a glut,' said Arlington Heights agent Bill Brucks. 'But there's plenty available. In the past five years we've had several new high-rises built here, and they're putting more in as we speak.'" "NAR President Thomas M. Stevens of Vienna, Va., cautioned Wednesday that sellers should expect prices to come down to 'more normal levels' because of inventory." " A report Wednesday from Goldman Sachs said the December existing-home sales report suggests that 'U.S. housing market conditions are deteriorating rapidly,' because inventories of both single-family homes and condos 'appear to be surging.' If the market doesn't bounce back sharply in early 2006, 'we may need to revisit our view that U.S. house prices are set for stagnation rather than outright declines,' the report stated."