The president of the Peoria Area Association of Realtors (PAAR) says recent trends suggest home sales are starting to rebound after a sluggish first quarter.
PAAR figures through the end of May show 1,900 closed sales this year. While that’s down nearly 6% from a year ago, nearly half of that total has come during the last two months.
“Our first quarter was tough, as far as sales compared to 2024. We attributed that to the uncertainty in the business market, the interest rates and low inventory,” said PAAR President Chris Hilton. “Now that we’re well into the second quarter, it absolutely is picking up.
“We’re still low on inventory though; that is that is the one of the key factors that’s affecting it right now. Also, the other key factor that we’re hearing continually is we need interest rates to drop.”
Hilton said inventory supply issues remain a major concern. New listings year-to-date are down 7.3%, with May showing a 12.3% dropoff from a year ago.
“It’s still low, but it’s low all over the country as far as inventory,” said Hilton. “But we’re cautiously optimistic that interest rates are going to start dropping, and if they do, that’ll absolutely help the market.”
Hilton says the decision to buy or sell a home is always an emotional experience, even more so when facing economic uncertainty.
“It’s a financial decision that people are watching everything that’s going on in the market, and the more unstable it feels, the more they say, ‘You know what? We’re going to hold off and not do anything right now and see how everything washes out,’” she said, noting homeowners are staying in their current residences longer now.
“The average length of time someone used to live in their house a few years back was seven [years]. It’s 11 now. So that makes a big difference in in inventory.”
Hilton said she believes concerns over where the national economy may be headed have suppressed the market to some extent.
“We are still seeing that as a factor that’s affecting home sales, but Central Illinois is still one of the most affordable spots to buy a home and to get what you’re looking for,” she said.
Hilton was in Washington, D.C., earlier this month for the national Realtors Legislative meetings. She said they emphasized finding ways to increase the supply of homes.
“We have to get more inventory that is priced affordable to get first-time buyers in the market,” she said. “There’s adding different programs, subsidies that they can provide for tax incentives. They’re looking at several different things that to help us out.”
PAAR’s statistics show the region’s median sale price at $150,000 and the average sale price at $182,000. Those figures represent increases of 11.1% and 9.4% respectively compared to 2024.
With the low inventory, homes are continuing to sell quickly – but the pace is slowing slightly. The average number of days on market was 33 in May and is at 38 for the year. Those numbers are up from 26 in May of last year and 32 through the first five months of 2024.
“Our inventory right now is 1.3 months and that means that if everything that was sold, or that was available to sell was sold and no new properties came on the market, it would take 1.3 months to sell out inventory,” said Hilton.
“That makes it a seller’s market. Where it turns into a buyer’s market is over six months. So we’ve got quite a ways to go with acquiring inventory.”
