Rockford area home prices continue to soar with no signs of slowing down

ROCKFORD — Home prices in the region soared to new heights in June and will continue to rise during the second half of 2022, as will mortgage rates and the number of homes on the market, according to a local real estate executive.

The three-month rolling average price for a single family home in Winnebago, Boone and Ogle counties rose to $187,072 in June, 4.3% higher than the region’s previous record high set in October 2021.

Mortgage rates continue their steady climb, with the latest average of 5.52% in June, up from 2.98% in June 2021.

“I think inflation will continue to remain strong through the second half of this year,” Northwest Illinois Alliance of Realtors CEO Conor Brown said. “Long term, we don’t anticipate any price declines. If people are contemplating purchasing a home, it’s still a great time to do so. Another reason to consider is the fact that we are such an affordable housing market compared to Chicago or the suburbs.”

Tom and Lisa O’Toole recently sold their two-story home in Aurora and are in the process of purchasing a ranch home on Greenfield Lane on Rockford’s near northeast side.

The O’Toole’s hope to close on their property at the end of August.

“We just decided it was an opportunity to downsize,” Lisa O’Toole said. “The difference in home pricing gave us something to add to our retirement and it put us closer to our grandkids. It just seems like there are more than enough cultural activities to do here and keep busy. We just really thought it was a good area.”

O'Toole said she and her husband are anxious to make the move despite the concerns she's heard about the city's violent crime rate and its taxes.

"I've heard some negativity about this area," she said. "Every urban area has its problems. I think the positives about Rockford outweigh its drawbacks."

More:Despite rising interest rates, Rockford region's home sales and prices on the rise

Housing inventory

While home sales in the Rockford region declined nearly 14% in June compared to the same month a year earlier, demand remains strong with properties remaining on the market for an average of just 15 days. 

The number of new listings in the region rose to 583 properties in June, the highest total in nearly a year. 

While inventory has grown each month since February, it is still nowhere close to where it should be, according to Brown.

“To create that balanced market, I think we still need somewhere between three to five times the amount of homes that are currently on the market,” he said. “We do anticipate that at some point, homes are going to be on the market a little longer. Sellers may need to mentally adjust for that in the coming months."

The average home price for the first half of the year in the three-county region rose 4.5% compared to the same period in 2021.  

Ken DeCoster covers business news and features. Contact him at 815-987-1391, kdecoster@rrstar.com or @DeCosterKen.