Americans purchased homes at the fastest pace in nearly 11 years, as sales climbed 5.6 percent in November, but the Chicago area continued its slow recovery from the Great Recession.
The National Association of Realtors said Wednesday that sales of existing homes rose last month to a seasonally adjusted annual rate of 5.81 million units. Home sales were last this strong in December 2006, when properties sold at annual pace of 6.42 million.
In the nine-county Chicago area, sales of existing homes and condos were down 1.6 percent from a year ago, to 8,119 properties sold. The median price of $225,000 was 5.1 percent higher than in November 2016.
Within the city of Chicago, existing home sales and the median price both were relatively flat, with 1,923 homes sold at a median price of $259,500.
The strong national demand for buying homes is a sign of an increasingly vibrant economy after a steady, eight-year expansion. The unemployment rate has fallen to a 17-year low, while more people in the younger millennial generation appear to be forming their own households and looking for places to buy. Yet the demand has done little to resolve an increasing vulnerability of the U.S. real estate market as the number of listings has been declining on a yearly basis for two-and-a-half years.
The shortage is a concern, but not necessarily enough to derail the sales momentum.
"The housing market is on relatively stable ground, despite the ongoing inventory squeeze and difficult conditions for buyers at the lower ends of the market in particular," said Aaron Terrazas, a senior economist at the real estate company Zillow.
In November, there were 1.67 million properties for sale, a 9.7 percent decline from a year ago. There is only 3.4 months' supply of homes on the market, the lowest level ever tracked by the Realtors.
The limited inventory has caused home values to rise faster than wages. The median home sales price increased 5.8 percent from a year ago to $248,000 in November. That price increase is more than double the rise in average hourly earnings, meaning that some Americans may be priced out of homeownership.
Sales rose last month in the Northwest, Midwest and South. But they fell in the West, where homes cost more and the price appreciation has been the most extreme.
Offsetting some of the cost pressures have been relatively low mortgage rates.
The average rate on 30-year fixed-rate U.S. mortgages was 3.93 percent last week, slightly better than the 4.16 percent rate a year ago, according to mortgage buyer Freddie Mac.