3 More Signs Of A Strengthening Housing Market
June 24th, 2009 categories: Economic Recovery, For Buyers, For Homeowners, For Sellers, Housing Market
The housing market got another dose of good news yesterday.
According to the National Association of REALTORS, the number of homes sold in May increased for the third straight month and the national housing supply fell by 5 months.
Furthermore, first-time home buyers are accounting for nearly one-third of the market activity.
But, before we declare a bottom in housing, it’s important that we remember the First Rule of Real Estate:
All Real Estate Is Local
National housing statistics like Existing Home Sales are painted with a very broad brush. They lump disparate locales such as San Francisco and Seattle into one sample set and don’t account for regional differences, let alone neighborhood ones.
Furthermore, getting down to a city-by-city, or even street-by-street basis, we can always find homes that are selling quickly and home that are languishing. Real estate is highly local and subject to countless influences.
That said, the national data isn’t completely useless. From the patterns, we can infer that low mortgage rates, ample home supply and available tax credits are providing a quantifiable boost to the broader real estate market.
And based on recent pending sales data, we can expect June and July’s Existing Home Sales figures to be similarly strong to May.
Therefore, if you’re in the market for a new home right now — or plan to be soon — be conscious of home inventory levels in your target neighborhoods. Fewer homes on the market usually means less ability for buyers to negotiate and that leads to higher sales prices.
Plus, the NAR is reporting buyer activity up 10 percent from last year.
The housing market may not be fully recovered in every housing market just yet, but in studying the data, a lot of the pieces appear to be falling into place.
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How Do You Spot A Good Deal? Ask Your REALTOR®
June 22nd, 2009 categories: Chicago Real Estate News
Price is important when you’re looking for a home. But it’s not the only factor that makes a particular home a good buy.
A recent story in the New York Times highlights this. The story talks about the many factors that go into spotting a good real estate deal. Yes, a big price reduction looks good. But if the home was overpriced to begin with, that price reduction might still not make a particular residence a good deal.
It’s a good story. And it makes a good point. Buyers can’t just look at one particular factor – whether it be price, location or a home’s amenities – to determine if a house is the right buy for them. They have to look at a combination of factors.
That’s where REALTORS® come in. A good REALTOR® will help buyers consider everything before deciding to purchase a specific house.
In today’s housing market, Chicago buyers are fortunate: They have a lot of inventory from which to choose, in even the top city neighborhoods. This means they can afford to be choosy. They have time to consider all the factors in and surrounding a home before making a decision.
Perhaps a young couple is interested in buying in a fun neighborhood filled with restaurants, bars and theaters. They can choose from many in Chicago: Lincoln Park, Lakeview, Lincoln Square, Ravenswood and Streeterville, to name a few.
Say they find a condo in Lincoln Square that seems perfect. It’s right in the middle of the neighborhood’s busy nightlife district. It’s spacious. And it has some of the latest amenities.
But what if their REALTOR® finds them a similar condo two blocks over that’s priced a bit lower? It may be farther away from the heart of the neighborhood’s restaurant and shopping district, but the lower price may compensate for that longer walk.
Or maybe it doesn’t. Maybe it’s more important for the couple to be located in the middle of all the hustle and bustle of Lincoln Square.
The point is, with the help of their REALTOR®, the couple considered all the pluses and minuses of a particular home before buying.
That’s what buyers should be doing in this market. In even the most popular of Chicago neighborhoods, buyers still have plenty of housing options from which to choose. By looking at all the factors surrounding a particular home, buyers, with the help of their REALTORS®, can find the perfect housing deal for them.
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Will Condo Market be Slower to Recover than the Market for Single Family Homes?
June 18th, 2009 categories: Chicago Neighborhoods, Chicago Real Estate News, For Buyers, For Homeowners, For Sellers, Housing Market
We’ve seen plenty of signs that the housing market in both Chicago and across the nation is starting to recover. Home sales are up. Sales are happening at a faster pace. This is all good news.
But one segment of the Chicago housing market will probably recover a bit slower than the rest: the condo market.
Chicago isn’t alone in this. According to a report by the National Association of REALTORS®, condominium and co-op sales were down significantly in April when compared to the same month one year earlier. The sales of existing single-family homes were down, too, but not by nearly as much.
According to the REALTORS® association, resale condo and co-op sales across the nation were down 9.4 percent in April of this year when compared to the same month in 2008.
In Chicago, especially in the downtown city market in high-rise condominiums, the news was just as bad when it came to condo sales: The Chicago Tribune reported that more than half of the new condo developments in downtown Chicago either had sales canceled or failed to make a single sale during the first quarter of 2009.
What does this mean if you own a Chicago condo? For one thing, you need to price your condo correctly if you want to sell it. There is a lot of competition on the market for condos in Lincoln Park, Lincoln Square, Lakeview, Roscoe Village and other top North Side Chicago neighborhoods - which includes a number of newly constructed units that are generally very attractive to buyers.
Secondly, your condo needs to be in top shape. There are plenty of new and nearly new condominium units on the market in Chicago’s top neighborhoods today. Your condo has to be in top condition to compete with these units.
If you’re shopping for a condominium, the sluggish sales are good news. You’ll find an incredible inventory of unsold condominiums from which to choose. Sellers will be willing to negotiate on everything from sales price to closing date. It’s a great time, then, to be buying a condo in Chicago.
Of course, whether you’re buying or selling a condominium, it’s best to work with a skilled REALTOR® who knows your neighborhood. If you’re selling, this REALTOR® will help you set the right price. If you’re buying, a REALTOR® will help you you’re your perfect condo while helping you negotiate a fair deal.
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Is a Chicago Rowhouse the Right Choice for You?
June 17th, 2009 categories: Chicago Info/News, Chicago Neighborhoods, For Buyers
Chicago’s North Side neighborhoods are notable for the wide variety of housing types and styles they feature. You can find luxury condos and restored Victorian single-family homes. You’ll come across townhouse developments and quaint bungalows.
All of these housing styles have their fans. The Chicago Tribune on Sunday highlighted yet another type of housing with a strong presence in North Side neighborhoods like Lincoln Park and Lakeview, the rowhouse.
You’ve undoubtedly seen these modest-looking homes. They’re attached to each other in a long row, hence the name. In fact, there’s little difference between a rowhouse and a townhouse. Usually, it’s up to the developer or builder to decide between the two names.
But whether you call these housing units rowhouses or townhouses, one thing is certain: Their popularity is growing.
These homes are especially popular among the important first-time home buyer market. There’s a reason for this: Rowhouses are usually more affordable – though not always – then either condos or single-family homes.
Besides their lower price tags, rowhouses come with other benefits. They often feature either little or no yard, for one thing. While this may seem to be a negative for some buyers, for others it’s a blessing. If you don’t enjoy spending your Saturday mowing the lawn or weeding, a rowhouse with a postage-stamp-sized yard might be ideal.
New rowhouses also tend to feature the same modern amenities that buyers can find in larger single-family homes. For instance, many rowhouses today include separate tubs and showers and large master bedrooms.
Rowhouses appeal, too, to “green” buyers. Rowhouses are usually located in the middle of walking neighborhoods. They’re often just steps from public transportation. It’s entirely possible to live in most city rowhouses without having to own a car. That is about as “green” as you can get.
Of course, rowhouses aren’t for all buyers. Some buyers will want more space than a typical rowhouse will give them. Others don’t want to be quite that close to their neighbors.
But for a specific set of buyers, the Chicago rowhouse is the perfect match.
Check out 474 W. Deming (pictured), one of our new listings and an absolutely stunning example of a Chicago rowhome.
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Pareto Principle In Action : 80 Percent Of The Country’s Foreclosures Occur In 20 Percent Of The States
June 17th, 2009 categories: Chicago Real Estate News
The Pareto Principle is a statistical concept most commonly known as the 80/20 Rule. It says 80 percent of the effects come from 20 of the causes. Apparently, the 80/20 Rule applies to foreclosures, too — at least according to data compiled by foreclosure-tracking firm RealtyTrac.
Based on data from May, 11 states accounted for 80% of the country’s foreclosure activity. The remaining 20% was spread across the 39 others. That’s 80/20 almost to the tee. The disparity goes deeper that that, though.
The top three states in RealtyTrac’s list — California, Florida, Nevada — were home to half of May’s foreclosure-related actions.
Clearly, foreclosures are concentrated in certain geographies. But, no matter in which state you live, foreclosures still impact you. This is because mortgage lenders are often national companies, lending in all 50 states. When home loans go bad — in any state – lenders respond by increasing downpayment requirements and by adding new borrowing hurdles.
If you’ve applied for a mortgage in the last 18 months, you’ve experienced this phenomenon personally.
On the other side, if you’re a home buyer in a foreclosure-heavy state, you’re finding terrific value versus several years ago. It’s one reason why Existing Home Sales in the West Region are up by 19 percent from last year, for example.
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