Home sales fell nearly 20% in Bloomington-Normal last year.
The 1,590 units sold in 2023 is down 19.2% from the 2022 total of 1,968, according to data provided by the Mid-Illinois Realtors Association (MIRA). New home construction dropped 24%.
MIRA’s data shows greater dropoffs in sales when including all of McLean County and surrounding counties. New construction fell 25% and overall home sales were 22% off the 2022 pace.
MIRA President Meenu Bhaskar, a Bloomington real estate agent, said demand for housing in Bloomington-Normal remains high, but homes aren't being built fast enough. She says many potential buyers are waiting for interest rates to start to fall before putting their current home on the market.
“Those buyers who are waiting desperately the last couple of years, they are going to jump into the market,” Bhaskar said an in interview on WGLT’s Sound Ideas. “It will take some time.”
Bhaskar said homes going on the market are typically not getting multiple offers within hours as they were in 2021 and 2022 when the community was experiencing an influx of Rivian employees, but she said many homes are getting offers within a few days — especially homes that are move-in ready. She added many sellers are asking for — and getting — down payments of up to 30%.
"I'm seeing a lot of first-time homebuyers who don't have a lot of money to put toward a down payment (who) are losing in those transactions," she said.
Bhaskar said she expects home sales will pick up in the spring — and agents will be busy again by summer.
The average price of newly built homes jumped 9% even though homes were built smaller last year. That's because of higher labor and material costs, Bhasker said.
The average sales price last year in Bloomington-Normal topped $250,000. The average new home went for $385,000.
Missing middle
MIRA is calling on Bloomington-Normal leaders to consider zoning changes to allow for higher density housing.
Bhaskar said so-called missing middle housing is what's needed to address the community housing shortage.
“If we provide that housing to the buyers, we can really, really help a lot of people,” Bhaskar said.
Bhaskar said many developers are less interested in building any home that's not single family because they get pushback from those living in nearby neighborhoods who argue they will lose property value.
The realtors group recently hosted a talk on middle housing with community planners in Bloomington-Normal.
Bhaskar said community leaders seem receptive to incentivizing more higher density housing as one way to reduce the housing shortage.
"I think we left an impression on them," she said. "I think we convinced them this is something they need to pay more attention (to) and look deeply into it."
