Gap narrowed between workers and affordable homes in DuPage
People who work in or near DuPage County are closer than ever to being able to afford to live here.
That's according to a report from the DuPage Homeownership Center in Wheaton showing the gap between the median house sale price in the county and median family income in the area closing significantly in the past year.
"The family earning the median income still doesn't have quite enough money to afford a median-priced house in DuPage, but it's getting closer," said Dru Bergman, the center's executive director.
Comparing income data for the metropolitan area with housing sales figures for DuPage, the center comes up with its annual "affordability index." This year, the median income is $74,900 and the median house sale price is $290,000, which put the index at 84 percent.
That means those median-income families have 84 percent of the monthly income needed to afford a median-priced house, Bergman said. It's 29 points higher than an index of 55 in 2007, and 19 points above last year's index of 65. That's because housing prices tumbled and household incomes increased while interest rates dipped as well.
Bergman said a perfect index would be 100, which would mean median-income families would spend at most 30 percent of its monthly income on housing costs.
"Hopefully it's going to help," said Mike Drews, president of the Main Street Organization of Realtors. "It should mean more people are attracted to buying homes in DuPage."
Drews' organization represents real estate agencies throughout DuPage County and the western and southern parts of suburban Cook County. Housing sales in DuPage County have declined significantly during the past five years, from 9,718 in 2005 to 4,913 in 2008.
Meanwhile, DuPage remains the priciest housing market in the state. Next highest is Kane County with a median house sale price of $218,500. Cook County's median sale price is the lowest in the Chicago area at $177,000. Lake County comes in it at $215,000, followed by McHenry County at $209,000 and Will County at $196,550. Statewide, the median sale price is $150,000.
Local real estate agents said the $8,000 first-time homebuyer tax credit has spurred the market in recent months, but with the program ending Nov. 30 they're unsure if the trend will continue.
"We have sold more homes than normal since this whole tax credit came out," said Naperville Coldwell Banker agent Gail Niermeyer. "The average first-time buyer is spending in the $250,000 to $300,000 range, which is where those median-priced houses are at."
While buyers are getting deals on houses close to the median sale price, some agents say the median figure is impacted by greater price reductions on high-priced estates.
"But in the end all prices are driven down," Drews said.
Bergman said while there's been a huge uptick in the number of people needing assistance from the center with foreclosure prevention, people are still attending first-time homebuyer classes. But that may not translate directly to an increase in house sales for the area.
"The problem right now is jobs," she said. "People are still very nervous."