By Suzanne Baker

Home buyers in Naperville are facing heavy competition and higher prices as sellers look to cash in on their equity.
Home prices in March were up 16 percent compared with last year, according to, and it’s a trend not likely to go away anytime soon.

The National Association of Realtors reports that homebuyers are facing a highly competitive market this spring because the inventory of existing and new single-family homes for sale is at its lowest since 1982. The Realtor group attributes the market conditions to job growth amid an aggressive fiscal policy and continued low mortgage rates.

“We just haven’t had the inventory come to market that we would need in order to satiate all that demand,” said Scott Parker, vice president of sales and marketing for John Greene Realtor, which has two offices in Naperville.
Home listings in the Chicago are are down 48 percent compared with last year, according to

“I hate the word ‘unprecedented,’ but this is really unprecedented in terms of what we’re seeing from the housing market in general,” Parker said.

With fewer houses on the market, multiple buyers are getting into bidding wars for the same property, which then drives up the price. Other homeowners may want to move, but haven’t settled on a place to go. Many of the larger homes owned by baby boomers remain among the most in demand—and most undersupplied. “If we can overcome the health and safety concerns, we can show the baby boomers some data, and the data is going to be very compelling because maybe they have been waiting for some of that lost equity,” he said.

Economists note that home prices generally double in value every 20 years. While the market has seen roughly a 59 percent appreciation in the last two decades, home appreciation values have only edged up annually between 2 and 4 percent since the recession in the late 2000s, Parker said.

“From the boomers’ perspective,” he said, “they haven’t seen that doubling they would have hoped for in terms of giving them the nest egg to do whatever it is that next chapter is going to bring.”

But the recent demand is causing price appreciation to go up as much as 15 percent in some places. “I think anybody who’s going to put their home on the market is going to be very surprised to see where the value is, and hopefully we’re getting to that point where it does unlock a lot of inventory and gives people the equity that they need,” Parker said.

With fewer existing homes for sale, buyers are turning to builders. Developers like Pulte Homes can’t build homes fast enough, said John Hudson, director of sales for Pulte Homes Illinois. “Wagner Farms is one of our best performers in the entire Chicago area and the country,” Hudson said. The single-family home development at Route 59 and 103rd Street in Naperville is selling about 11 homes per month, but the demand is much higher. And millennials are a major force behind the homebuying frenzy this past year, Hudson said. As they get older and have children, they find they want home ownership. And they’re choosing to live in Naperville because of the schools, Hudson said.

Homebuyers typically consider the location, amenities available in the area, and pricing. But in Naperville, schools trump everything, he said. Different from previous first-time homebuyers, millennials are older and they have little to no debt, having paid off their student loans, Hudson said. They’re also skipping the entry home and moving directly into their “forever” home.

Many were enticed into the real estate market because of low interest rates, Hudson said. When rates started to creeping up, fear of missing out caused those sitting on the sidelines to create the pop-up demand in the past year.

This story originally appeared in our sister publication, the Naperville Sun, and is reprinted with permission.

Photo by Suzanne Baker/Naperville Sun