ROCKFORD — Home prices in the region soared to yet another record high in July while properties sold at their fastest clip ever.
The three-month rolling average price of a home sold in July in Winnebago, Boone and Ogle counties was $193,118, according to the Northwest Illinois Alliance of Realtors.
That’s a nearly 11% increase compared to figures from July 2021 and it’s about $6,000 higher than the previous record set in June.
The number of homes for sale in the three county region tumbled more than 20% last month which helped fuel the price increase, according to Northwest Illinois Alliance of Realtors CEO Conor Brown.
“It’s because there are many more buyers than homes for sale,” Brown said in a news release. “That imbalance is putting upward pressure on home prices because demand is extremely high and supply is at a record low level.”
The continued lack of inventory has contributed to a decline in sales volume.
A total of 426 homes were sold in the region in July, marking a drop of more than 17% compared to figures from a year earlier.
Sales volume is on a pace to decline nearly 3% in 2022 if current trends continue.
More:Rockford area home prices continue to soar with no signs of slowing down
The time it took to sell a home in the region averaged a record of 10 days in July compared to the previous record of 13 days a year ago and down from 44 days in July 2020.
While mortgage rates are nearly double what they were a year ago, the latest 30-year, fixed rate average of 5.41% is down from 5.52% in June.
The current growth rate of the region’s home prices is most likely unsustainable because of the higher mortgage rates, according to Brown.
“That doesn’t mean prices are likely to fall,” he said. “Home prices will continue rising, but probably at a slower pace.”
New U.S. Census data indicates the nation’s home ownership rates rose to nearly 66% during the second quarter of 2022, about three percentage points below the record high set in 2004.
“There are several benefits to owning your own home,” Brown said. “A significant one, especially when inflation is high like it is today, is that home ownership can help protect you from rising costs, while building wealth.”
Ken DeCoster covers business news and features. Contact him at 815-987-1391, kdecoster@rrstar.com or @DeCosterKen.
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