Chicago, IL, December 04, 2013 --(PR.com
)-- This year the holidays may offer a welcome opportunity for would-be homebuyers. The major rebound in home sales activity and home prices that has been seen across the metro Chicago real estate market during the second and third quarters of 2013 was great news for home sellers, but something of a mixed blessing for buyers, many RE/MAX brokers report.
A limited inventory of homes for sale and strong demand from first-time buyers and investors turned what had been a buyers’ market last year into a fast-paced competition for properties this year. Home sales in the seven-county metro Chicago area were 28 percent higher and the median sales price was 12 percent higher during the peak months of the housing market, April through September, than during that same period in 2012.
Buyers did face some challenges during the height of the summer market.
“It got a little tough for buyers. We went from a market that wasn’t really moving last year to this spring when many more buyers decided it was time to act. Buyers were looking for deals, and homes were at great prices,” said Jose Rey of RE/MAX Unlimited Northwest in Crystal Lake, Ill. “But as more buyers came into the market and the inventory of homes shrank, there were many more multi-offers situations where buyers felt they had to compete, and some would drop out.”
Michael Gerhardt of RE/MAX Edge in the Lake View neighborhood of Chicago recalls that one client visited 60 homes and submitted 15 offers before finally getting the home she wanted under contract earlier this year.
“A lot depends on the level of available inventory,” said Gerhardt. “Where inventory is tight, buyers must be ready to make quick decisions even during the holidays.”
Now the situation is improving for buyers. Both individual sellers and banks seeking to dispose of foreclosures are eager to market their properties while mortgage interest rates remain low. That factor, when combined with improving home prices, is helping push more homes into the market.
The total number of home sales completed over the winter months may not be as large as the totals for spring or summer, but that doesn’t mean homes aren’t selling in substantial numbers. Home sales completed between Dec. 1, 2012 and Feb. 28, 2013, totaled nearly 20,000 in the metro Chicago area, and the current market is considerably stronger.
The December-February period is also a time of year when those buyers and sellers who remain active tend to be serious about closing a deal, so the business of reaching an agreement is likely to happen a bit more smoothly, according to Anna Klarck of RE/MAX Showcase in Long Grove, Ill.
“I have a client who is closing on her first home in December even though the lease on her apartment doesn’t expire until next July. She was willing to pay $3,000 to break her lease because she felt she could get better terms and a lower interest rate by buying now. There is a good chance that both home prices and interest rates will be higher next summer than they are today. And without doubt, the purchase was easier to negotiate than it might have been three months ago.”
Another positive factor for buyers, said Rey, “is that many banks are getting their foreclosed homes in shape and pricing them reasonably in hopes of generating more showings and offers. That takes a lot of the uncertainty out of buying these properties. Plus, the banks are also making these homes easier to finance.”
For homebuyers, shopping at this time of year, “is usually a question of motivation and time,” said Lisa Cleaver of RE/MAX Suburban in Glen Ellyn, Ill. “Can you make time for it given all the other demands of the season? Can you tramp through snow and cold to look at homes? If you can, then this season will be an ideal period to shop for a home. Prices and interest rates are a bit higher than they were but remain quite attractive, and when a house is on the market during the holidays or just afterwards, it’s a fairly clear sign the owner may be eager to sell.”
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