This three-bedroom home at 817 Parkview Ave. is listed for a little under $190,000 on Tuesday, July 2, 2024, in Rockford. Homes in the Rockford region set another record high for sale prices in May, according to new data from NorthWest Illinois Alliance of Realtors. (Photo by Kevin Haas/Rock River Current)

By Kevin Haas
Rock River Current
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ROCKFORD —  Home sale prices in the region set another record high as the inventory of houses on the market increased for the first time in more than three years.

The three-month rolling average price of a home sold in Winnebago, Boone and Ogle counties was $210,089 in May, according to the latest data from the NorthWest Illinois Alliance of Realtors. That price is up nearly 60% in five years, and it’s up 12% from May 2023.

“Homeowners are seeing unprecedented rises in their home equity,” said Conor Brown, CEO of the NorthWest Illinois Alliance of Realtors. “Home prices have surged 50% since the start of 2020, easily outstripping the gains seen in recent decades.”

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The inventory of homes for sale rose 7% to 229 from 214 in May 2023, according to the Realtors group. That’s the first time that inventory has increased in three and a half years, although it’s still below the historical average.

The number of new listings has also increased, up 20% through the first five months of the year from 189 in January to 423 in May.

“The headlines that you see, that inventory is improving, things are going up, is true,” Brown said. “We have more sellers finally starting to come back to the market, and that’s really good news, but we need more.”

Homes continued to sell quickly, moving in an average of 19 days on the market. That’s one day longer than the same month a year ago and 10 days more than the record fast pace.

Rising mortgage rates over the past three years have kept some homeowners from selling for fear of losing the record-low mortgage rates they locked in at 3% or less. That’s contributing to the limited supply of homes for sale.

The 30-year fixed mortgage rate was 6.86% at the end of June, down from a peak of 7.79% in fall 2023.

Mortgage rates won’t start to fall until the Federal Reserve begins cutting rates, but the Fed has indicated it now expects to cut rates only once in 2024 instead of the three times previously predicted. Even after the cuts, rates won’t return to their pandemic-era lows, the Realtors group said.

“Sellers considering listing may want to make plans to act quickly in a pinched inventory market, especially with home prices hitting a record high,” Brown said. “Buyers should talk to their Realtors about multiple offer scenarios in this competitive Rockford market.”

This article is by Kevin Haas. Email him at khaas@rockrivercurrent.com or follow him on X at @KevinMHaas or Instagram @thekevinhaas and Threads @thekevinhaas