Maya, Home Buyer in Champaign, IL

Can someone give me information about the Champaign/Urbana real estate market?

Asked by Maya, Champaign, IL Tue Feb 17, 2009

I am planning to buy a house but I am not sure whether house prices will drop further. It seems that there are many houses that are just sitting there. I have been observing the market for the last year and it does not seem that houses are moving quickly. Is this because they are just getting overpriced?
I would really appreciate an opinion from people here. Also is the Yankee Ridge neighborhood of Urbana, north of Windsor a good area to buy it?

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Mariya Vandivort’s answer
Dear Maya,

I can tell that you've have been following the market pretty well. You are fortunately to have control over when to move, since more people are stuck in dealing with the market that they are currently facing (like people who have to sell right now). There are currently 591 homes for sale in Champaign/Urbana/Savoy, with an average of 118 days on market (DOM). You bring up a good point of homes being overpriced. The 191 homes that have sold in the past 3 months have had an average DOM of 90. There are homes that are selling, which are priced to sell, and there are homes that are not, which are priced to sit. If there are just fewer buyers in the market, only the cream of the crop will sell, and with as many homes as there are available, buyers can be picky.

Having said that, it is really impossible to predict the future of homes prices in Champaign/Urbana. We have to keep in mind that interest rates (the cost of money) have a tremendous impact on affordability. In addition, if you are a first-time homebuyer, you qualify for the $8,000 tax credit (details at http://www.AroundCU.com/blog). With the average median home price right at about 150K right now, this is like a 5.3%-off sale on all homes, which can definitely alter the market, especially if you are looking for homes around that price range.

To answer your question about location, the area north of Windsor is actually "Ennis Ridge" (between Race and Philo); Yankee Ridge is south of Meadowbrook Park. Regardless (subdivisions take a long time to learn... and I'm not sure it's that necessary) :), it depends on your definition of "good area". Are you looking at crime, centrally-located, re-sale value, etc.? There are several areas around that are similar, and it will come down to what is most important for you.

Take care,
Mariya
Web Reference: http://www.AroundCU.com
1 vote Thank Flag Link Tue Feb 17, 2009
Maya,
That's a pretty in depth question and really depends on the specific house, style and neighborhood you are considering. Regarding Yankee Ridge, it has always been a desirable neighborhood with a strong reputation. Historically, there is not a large amount of turnover in that area. There are a few homes currently on the market though.
For Champaign County the average sale price dropped by a little under 1% last year. The average days on market for closed sales was up as well to 84 days. Comparing these numbers to the national average C/U can look great. A popular question in this area is how long can our local market hold up?
The short answer as to why those homes are still on the market is price, but there are a lot of factors that feed into it. We haven't had major layoffs in Champaign/Urbana although the University has instituted a hiring freeze which will affect the supply and demand of homes this year.
If you were looking to buy a home in Champaign purely as an investment betting on appreciation I would tell you to hold off. If you were buying a home as a 'cashflow investment' I think there are some great opportunities. If you were buying a home to live it it, make it your home and enjoy it for the next few years then I would tell you that is a great idea as well.
Good luck!
1 vote Thank Flag Link Tue Feb 17, 2009
Maya, You can find information taken from the county public records on housing trends/sales here..
http://www.bhgrealestate.com/Views/Look/Default.aspx ...you can break it down by zip codes also....

This Trulia interactive map also can provide you a lot of info....http://www.trulia.com/home_prices/Illinois/Champaign_County-…

Keep an eye on the employment situation in the area....Dunes
1 vote Thank Flag Link Tue Feb 17, 2009
It definitely helps. Thank you all very much for your insights.
0 votes Thank Flag Link Wed Feb 18, 2009
Dear Maya,

The three areas that you mentioned are very similar. They are conveniently located, have historically had similar appreciation rates, and have homes within them that vary in price quite a bit. The homes are older, but they have a lot of character and don't all look the same, as is common in newer subdivisions. I actually have a client right now that is interested in those areas for precisely the same reasons as you. :)

One thing to keep in mind, though, is that regardless of neighborhood appreciation overall, home values within a particular neighborhood tend to coalesce over time. Although it might be attractive aesthetically, you generally do not want to have the most expensive house on the block. If appreciation is a big concern for you, when neighborhood values go up, the most expensive house might not appreciate as much proportionally because it may now have homes in more popular neighborhoods to compete against.

I hope that this makes, and I appreciate your insightful questions,
Mariya
Web Reference: http://www.AroundCU.com
0 votes Thank Flag Link Wed Feb 18, 2009
All of the areas you have mentioned have held or increased their values historically. The current market will really test that going forward though.
As a very general rule, the areas of Urbana you are looking at (N. of Windsor) will get increased interest/demand the closer you get to campus. In general, the streets you mentioned have been very 'solid'. Near Philo/Windsor corner of that neighborhood there are more duplex properties which has kept the values of the neighboring single family homes a bit lower than the homes farther NE (closer to campus and in a pure single family home area).
Ayrshire and Devonshire in Champaign continue to be popular, respected neighborhoods as well. They are established areas with above average home values and they are in a very central location for Champaign. Homes are selling slower in these two areas as well, but they continue to sell.
0 votes Thank Flag Link Wed Feb 18, 2009
Hi, thanks so much for responding. I really appreciate the quick feedback, since we are both so new at this.
I guess that we are looking in the Boudreau, Grange, Mchenry, Silver street area just north of Windsor Street in Urbana.
It seems that there is a mix of homes here from all price ranges. That;s why it's sort of hard for me to tell whether the houses will hold their value or depreciate further over the next few years.
We would like to buy the home as a place to live, but we'd also like to make a little money on it if possible. That's why it's important for us to buy in an area that's nice and established and won't depreciate.

The areas we have been looking at Urbana (the areas mentioned), Ayrshire, and Devonshire. What is your opinion on these neighborhoods? Will houses retain value here?
0 votes Thank Flag Link Wed Feb 18, 2009
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