Home sales up in Chicago area, price declines continue

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Updated: March 24, 2012 9:00AM

Home sales rose in the Chicago metropolitan area to the highest level for the month of January since 2007, but prices continued to fall, the Illinois Association of Realtors reported Wednesday.

January home sales jumped 15.7 percent to 4,447 from a year earlier. The median price sank 11.4 percent to $140,000, the lowest level since the association began keeping records in 2004.

In the city of Chicago, sales rose 5.7 percent to 1,093. The median price slipped 0.7 percent to $149,000.

The settlement earlier this month between states and five large banks regarding foreclosure documentation issues is expected to lead to more foreclosed home sales here this year, according to Geoffrey Hewings, director of the University of Illinois’ Regional Economics Applications Laboratory.

“This provides mixed news for the housing market,” he said in a statement. “It is positive in the sense that the large backlog can now begin to be removed from the inventory. However, it is likely to continue to dampen any prospect of near-term housing price recovery.”

Statewide, sales jumped 16.1 percent to 6,435. The median price dropped 9.3 percent to $122,500.