Building a new home? Values are on the rise in the Peoria area, study says

The Peoria area had the 11th-highest increase in the property value of a new home over the past year for mid-sized metros, according to a new report from a major national publisher of construction insurance guides.

The report from Construction Coverage said that the property value of a new home in Peoria increased by 77.2% from the end of 2022 to the end of 2023, just outside the top 10 among 99 mid-sized metropolitan markets in the United States. In total, Peoria's new residential units saw a $6 million increase in value.

More: How low inventory is affecting home sales in Peoria and the rest of Illinois

Using data from the U.S. Census Bureau'sBuilding Permits Survey, Construction Coverage calculated the percentage change in value of new homes from the fourth quarter of 2022 to the fourth quarter of 2023, along with calculating the percentage change of the number of new homes built from one year to the next.

In that case, Peoria also saw a decent jump in the numbers, with a 47% increase after seeing a net of 15 new homes built over the past year.

Where are new homes increasing in value?

Topping the list of areas increasing in value among mid-sized markets was Flint, Michigan, which saw a 293.4% increase in value over the past year and a 387.2% increase in the number of new homes built. The Oxnard-Thousand Oaks-Ventura market in California came in second with a 209.7% increase in value, with Trenton-Princeton, New Jersey, coming in with a 195.3% increase in value.

Peoria was the only market in Illinois to rank in the top 25 among mid-sized markets, as the Quad Cities came in at 68th with a 13.4% increase in value. Among smaller markets, Rockford ranked 15th with a 120.7% increase in value and a 67.6% increase in the number of new homes sold — the only market in Illinois to rank in the top 100.

Springfield came in at 142nd, with barely any increase in value, but a 34.8% increase in the number of homes built, while Bloomington came in at 163rd on the list, dropping 9% in value and with a decrease of 37.6% in the number of new homes built. Champaign-Urbana ranked 176th on the list, with Kankakee having the 6th-worst value of a new home, dropping 61.8% from 2022.

Is the housing market on the rebound?

Among bigger markets, Chicago saw a 3.4% decrease in value, coming in at 42nd among 53 markets. Illinois saw the value of homes drop 13.1%, the fifth-worst mark in the country.

Construction Coverage said that the numbers overall reflected a potential rebound in the housing market, brought forth by an increase in value and a slight drop in 30-year mortgage rates.

"This uptick in activity suggests a potential return to growth, incentivizing builders to seek permits for new construction, which could help alleviate the inventory shortage that has plagued the country for years," said Jonathan Jones, senior researcher for Construction Coverage.

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This article originally appeared on Journal Star: Value of new homes increased in Peoria in 2023