Multiple offers and eager buyers in 2013 does not mean there is a new real estate bubble forming
April 29th, 2013 categories: Chicago Real Estate News
By now, we’re all familiar with the real estate bubble. That’s when housing prices during the real estate boom years – between 2004 and 2007 — soared to unrealistic heights. Simply put, home prices rose too fast too quickly.
That bubble popped, with housing values starting to fall rapidly by late 2007. We’re still dealing with the aftermath. Too many homeowners are still underwater, owing more on their mortgage loans than what their homes are worth. The country is also dealing with far too many foreclosures.
So, now that housing prices across the country are starting to rise again — though in Chicago, housing prices aren’t rising nearly as fast as they are in other parts of the United States — it leads to an obvious question: Are we in danger of another real estate bubble?
The answer, at least according to a key official with the Federal Reserve Board? No.
In a recent story by Forbes, Erick Rosengren, president of the Federal Reserve Bank of Boston, said that he doesn’t see any bubbles anywhere, not even in residential real estate.
Rosengren said that housing prices in even some of the hottest real estate markets across the country — places such as Las Vegas, Phoenix and Miami — are still priced at discount levels.
Rosengren also said that he sees the national economy gaining momentum, even if that momentum gain isn’t quite as fast as most of us would like to see.
Let’s hope that Rosengren is right about that real estate bubble. The last time the bubble popped, it helped throw the country into a recession that is still causing pain for too many U.S. residents. If you want to boost your odds of buying a home in Chicago at the right price — not too high or too low — work with a REALTOR(R) who knows your neighborhood. This professional can tell you when a Chicago condominium or single-family is priced too high, just right or below market.
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Hot Chicago real estate market means the best properties are sold before the MLS
April 26th, 2013 categories: Chicago Real Estate News
Here’s the good news: The Chicago housing market is hot, with good properties in strong neighborhoods often selling before they’re officially listed. And now for the bad news: If you’re trying to buy one of these homes, you might struggle to nab a property before it’s sold to another eager buyer.
The Chicago Tribune recently ran a story on Chicago’s bustling real estate market. The message? If you find a Chicago condominium or single-family home that you like at a good price, act fast. If you hesitate, that home will soon disappear.
As the Tribune reports, the historically low interest rates attached to 30-year fixed-rate mortgage loans and the reasonable asking prices of Chicago homes have combined to give the local housing market a strong boost. It’s also increased competition for the best homes in the city.
In fact, the Tribune story points out that what are known as pocket listings are making up a growing slice of Chicago real estate sales. A pocket listing is a home that is marketed privately, without being listed on the MLS. Traditionally, pocket listings have been reserved for ultra-expensive or celebrity homes. Today, though, a growing portion of standard home inventory is being sold through these private listings.
If you’re looking for a reason, check out the city’s available inventory of condominiums and single-family homes. As the Tribune reports, city housing inventory today is about one-third to one-half what it was just one year ago.
If you’re searching for your dream Chicago home, it’s time to work with a skilled REALTOR® who knows your neighborhood. Not only will such a professional be able to help you determine which Chicago residences are priced fairly and which are not, a REALTOR® can also connect you to those pocket listings that never make it to the rest of the public. Who knows? A pocket listing might be the perfect condominium or single-family home for you.
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Buying a short sales or foreclosure may not be worth the headache for some
April 24th, 2013 categories: Chicago Real Estate News
It’s not easy finding the right condominium or single-family home in Chicago these days. Inventory is tight. If you find the perfect condo in Lincoln Park, Lakeview or Lincoln Square, the odds are high that other buyers will be bidding on the same property. And bidding wars are never a good thing for buyers.
But homebuyers in Chicago — and across the country — have an alternative: short sales or foreclosures.
The AOL real estate blog recently ran a story about the bargains that buyers can find in the country’s high supply of distressed homes. A distressed home is one that is either being sold through the foreclosure process or in a short sale.
Both types of sales can lead to solid bargains. In a foreclosure, banks often sell good properties in strong neighborhoods for lower-than-market-value prices as a way to get these properties off their hands. In a short sale, lenders allow owners to sell their condos or single-family homes for less than what they owe on their mortgage loans. This allows the sellers to put a lower price tag on their residences. Buyers can even buy foreclosed properties in an auction; again, homes that sell during the auction process often move for a lower price tag.
However, as the AOL story points out, there are risks involved in buying foreclosures and short sales. In a short sale, the lender working with the sellers must approve your offer. The lender can reject your offer even if the seller has already approved it.
In a foreclosure, you might purchase a property that has serious problems. The owners of foreclosure properties rarely have the money needed to keep up with repairs and maintenance. This means that a foreclosed property might require thousands of dollars in repairs.
There are bargains to be had in short sales and foreclosures. But buyers need to be cautious. And they need to work with a REALTOR(R) who understands the distressed market.
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Hispanic home buyers continue to make an impact
April 19th, 2013 categories: Chicago Real Estate News
If you followed the recent presidential election, it should come as no surprise that Hispanics have become the country’s fastest-growing group of people. It’s why politicians are scrambling to find ways to appeal to this group.
Hispanics are making an equally big impact in the world of residential real estate. According to a national real estate association, Hispanics are today’s fastest-growing group of first-time home buyers.
This information comes from the 2012 State of Hispanic Homeownership Report released recently by the National Association of Hispanic Real Estate Professionals (NAHREP). According to the report, the number of Hispanic homeowners in the country has jumped from 4.24 million in 2000 to 6.69 million in 2012. That’s a sizable increase of 58 percent.
There is some evidence that there’d be even more Hispanic homeowners if not for an inventory problem. Juan Martinez, president of NAHREP, said that the biggest challenge Hispanic home buyers face is the lack of housing available for them to purchase. Martinez said that Hispanic buyers will play a major role in the future of the U.S. housing market if they can find enough properties to purchase.
Chicago has long been a popular choice for Hispanic home buyers. And why not? The city is filled with great amenities, everything from amazing restaurants to eclectic shops to spacious parks and green spaces. I expect the number of Hispanic homeowners in the city to keep rising.
By the way, if you’re wondering what is important to Hispanic home buyers, it’s pretty much the same things that are important to all buyers. According to the report, 56% of Hispanics said that an important reason to buy a home is because doing so is a symbol of success or achievement.
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Hotel rooms are filling up in Chicago. That’s good news for home sellers!
April 15th, 2013 categories: Chicago Real Estate News
You’re ready to sell your house. Should it matter to you that the number of guests staying in Chicago hotels has been steadily growing?
The answer? Yes.
Crain’s Chicago Business recently reported that in March, hotel occupancy in Chicago hit its highest point since 2006. According to numbers released by the city of Chicago and the city’s tourism organization, Choose Chicago, the hotel occupancy rate for the city in March hit 73.5 percent. That’s a bit better than the all-time high of 73.2% in March of 2006.
And in the first quarter of 2013, the city’s hotel occupancy rate stood at 59.9%, the highest that number has been since the first quarter of 2007.
Why is this good news for Chicago residents ready to put their homes on the market? It’s yet more evidence that consumers are digging out from under the recession. After all, consumers worried about their finances rent fewer hotel rooms, not more.
This shows that consumers today are more confident about the direction of the economy, and that many of them are happier with the condition of their own finances.
Yes, the economy still has a long way to go, both in Chicago and across the country. The national unemployment rate recently dropped to 7.6 percent. But much of that drop was attributed to the high number of people who have simply given up on finding a job.
But for home sellers, any evidence that consumers are gaining confidence has to be welcomed. Sellers will still have to list their homes at the right price. And they’ll have to work with a skilled REALTOR® who can market that home properly.
But rising hotel occupancy rates in Chicago show that consumers are ready to spend again. And that includes spending on the largest and most important purchases of their lives, a new home.
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