Is Now A Good Time To Be Both A Home Buyer and Home Seller?

I have been contemplating a very interesting concept relative to the current conditons in residential Real Estate … can it be a good time to be a Home Buyer and a Home Seller at the same time? Some might say that a Home Buyer needs to get a great deal on a home in order for it to be a good time to buy.  The same thought process would suggest that a Seller would have to sell at or near a peak price in order to be a good time to sell.

In my opinion, the Real Estate bubble of 2008 has created a world where perceptions and realities can affect a potential Buyer or a Seller from taking the appropriate action that is right for them. For example, any of us homeowners who looked at Zillow or any home valuation tool in 2005 to early 2008 probably have an amount in our minds that seems unrealistic in 2016. Due to the bubble and the artificial price inflation we experienced, those values were meaningless, unless you were selling at the time … and if you were lucky enough to sell at that time, chances are you bought something else that was “overpriced.”

Then, there are the potential Buyers who are sitting on the sidelines with the belief that we are headed for another bubble as prices are projected to increase 5 to 6% this year. This quote by Lawrence Yun, Chief Economist for the National Association of Realtors sums it up well:

“Even though the credit conditions appear to be easing somewhat, the move is from overly stringent conditions to not-so-overly-stringent conditions. It is a far-fetched view to imply the current mortgage approval process in any way resembles the loosey-goosey, easy subprime mortgage access conditions of a decade ago.”

In other words, prices are increasing because demand is in excess of supply, not because of artificial factors as in the early to mid 2000’s.

So, to my argument that now is a time that is good to be a Home Buyer and a Home Seller, here are my key points:

Interest Rates are historically low and chances are they are not going to stay this low. Being able to secure an interest rate under 4% creates buying power for Buyers enabling them to purchase a more expensive home and/or buy any home, for that matter. Clearly a benefit to Home Buyers! Well, if you are selling your home, you certainly want to have as large a pool of buyers as possible. If interest rates increase to 5%+ in 2017 as Freddie Mac projects, buying power will decrease and that will affect both Home Buyers and Sellers!

Potential Sellers’ understanding of their home’s value and equity in their home need to be revisited. According to Corelogic, 91.5% of homeowners have positive equity in their homes and 72.6% have significant equity in their home. Significant equity is considered 20% or greater. This is a big deal! By understanding the value of your home and understanding your equity position can enable you to move on with your life … downsize, move to a warmer climate, move closer to your kids and grand kids, etc. So many people have delayed their move as they were “under water” on their mortgage. That brings me back to a point I made earlier, as I have heard people say that they are going to wait until the market continues to improve back to pre-bubble levels to increase their return on investment.   Who knows if that will happen AND do your really want to continue to delay the next chapter in your life?!

The reason this is so important is because we are experiencing such a shortage of inventory for sale.  For example in Buffalo Grove, there is only a 2 months supply of single family homes for sale. The only real downside for Home Buyers now is that all of the good listings are selling fast and their options are limited. NAR has reported that “foot traffic,” which measures showings is up significantly, indicating that demand is high. The biggest impediment to Home Buyers is simply a lack of inventory!

While I don’t want to be considered a “cheer leader,” I do believe that NOW is a good time to consider that next move and chapter in your life!

Buffalo Grove Real Estate Market – March Healthy

The Buffalo Grove real estate market is healthy through the first quarter of 2016 with some key indicators pointing to a breakout April and May. Inventory remains very tight, market times are up slightly, new listings and homes under contract are well above last year’s pace.

Single Family Homes

Average Market Time

The time a single family home remains on the market in Buffalo Grove is 109 days which is up from 80 days in March 2015. Buffalo Grove had the lowest market time in the Chicagoland area in 2015, so we are at more average level so far in 2016.

Buffalo Grove Real Estate Average Market Time

 

Months Supply

As of April 1, 2016, there is a 2.9 months supply of single family homes for sale in Buffalo Grove compared to 3.2 last year. Anything under 5 months is considered a seller’s market.

Buffalo Grove Real Estate Months Supply

 

Homes For Sale

At the end of the first quarter of 2016, there are 107 single family homes for sale in Buffalo Grove, compare that to the 102 available at this time last year and you’ll see that inventory remains very low. There aren’t enough homes to supply the current buyer demand, which provides for a very competitive environment.

Buffalo Grove Real Estate Homes For Sale

 

New Listings

81 single family homes were listed for sale in March of 2016, compared to 63 new listings last year. This influx of inventory is great news for the pent up demand of buyers.

Buffalo Grove Real Estate New Listings

 

Homes Under Contract

With the influx of new listings in March, some significant demand has been satisfied as 67 single family homes went under contract in Buffalo Grove. This is an increase of 26 from 2015 or a whopping increase of 63%. Assuming that they close in April and May, it will be a huge shot in the arm for the local market. As you can see from the chart below, this is by far the largest number of homes under contract in a single month in recent history.

Buffalo Grove Real Estate Under Contract Listings

Closings

29 Single family homes closed in March, down slightly from 31 in 2015. Through the first quarter, 65 single family homes closed this year versus 66 in Q1 2015. The new listings and new homes under contract bode well for the new quarter’s results.

Buffalo Grove Real Estate Closed Home Sales

Condos and Townhomes:

Average Market Time

The time Condos and Townhomes remains on the market in Buffalo Grove is 82 days which is up from 7o days in March 2015. This is a relatively low figure and reflects the competiveness we are facing with Condos and Townhomes.

Buffalo Grove Real Estate Attached Average Market Time

Months Supply

As of April 1, 2016, there is a ridiculously low 1.9 months supply of Condos and Townhomes for sale in Buffalo Grove compared to 2.1 last year. Buyers have to move quickly when an attractive listing hits the market!

Buffalo Grove Real Estate Attached Months Supply

Homes For Sale

At the end of the first quarter of 2016, there are 61 Condos and Townhomes for sale in Buffalo Grove, compare that to the 67 available at this time last year and you’ll see that inventory remains very low and getting even tighter. There simply aren’t enough homes to supply the current buyer demand, which provides for a very competitive environment.

Buffalo Grove Real Estate Attached Homes for Sale

New Listings

63 Condos and Townhomes were listed for sale in March of 2016, compared to 53 new listings last year. This influx of inventory is great news for the pent up demand of buyers.

Buffalo Grove Real Estate Attached New Listings

Condos and Townhomes Under Contract

With the influx of new listings in March, some of the pent up demand has been satisfied as 49 Condos and Townhomes went under contract in Buffalo Grove. This is an increase of 8 from 2015 or an increase of 19.5%.

Buffalo Grove Real Estate Attached Under Contract Listings

Closings

33 Condos and Townhomes closed in March, up from 27 in 2015. Through the first quarter, 71 Condos and Townhomes closed this year versus 70 in Q1 2015. The new listings and new homes under contract bode well for the new quarter’s results.

Buffalo Grove Real Estate Attached Closed Sales

Addison Real Estate Market – March a bit Sluggish

Addison Real Estate Market

The Addison real estate market is healthy but a bit sluggish for March 2016. Inventory is super tight, market times are up slightly, new listings  and closings are down over this time last year.

Days on Market

The time a home stays on the market in Addison is 137 days which 10% higher than last year when homes were on the market 125 days. Condos and townhomes are on the market 141 days compared to last year at this time when they were at 134 days. Prior to 2014, market times were hugely volatile, but since 2014 around this time, while market times have fluctuated for both property types, they’ve stayed under 150 days.
Addison Real Estate Market Times

Months Supply

As of April 1, 2016, there is a 3.1 months supply of single family homes for sale in Addison compared to 3.5 last year.  For condos/townhomes, the supply has decreased drastically from a 5.2 months’ supply last year to a 3.1 months supply as April 1, 2016. Anything under 5 months is definitely a sellers market.
Addison Real Estate Market Supply

Homes For Sale

As of April 1 2016, there are 83 single family homes for sale in Addison, compare that to the 142 available at this time last year and you’ll see that inventory is super low. Condo and townhome inventory is way down too, with 33 on the market now compared to 140 at the same time last year.  There aren’t enough homes to supply the current buyer demand which provides for a very competitive environment.
Addison Real Estate Market Homes for Sale

New Listings

13 condos/townhomes and 41 single family homes were listed for sale in March of 2016.  Last year at this time 16 condo/townhomes and 49 single family homes were listed.  Less listings in an already tight market isn’t great news for buyers.

Addison Real Estate New Listings for Sale

Closings

Residential closings are down from this time last year with only 4 condos/townhomes closed compared to 10 last year.  Last year at this time 27 homes closed, and this year only 21 closed. 2015 was a strong year for closings with an unprecedented 40 single family homes closed in July 2015.

Addison Real Estate Closings

Median Sales Prices – Single Family Homes

If you wonder how foreclosures and short sales compare in price to traditional sales, the graph below might help you understand.  The data reflects the median price of single family homes sold in Addison.The red line shows the median price of a traditional sale and it trends about $50k higher than the distressed sales in which the foreclosures are charted in blue and short sales in yellow.

Addison Real Estate Closings Median Prices

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Buffalo Grove Real Estate Market: Results for February were Solid

Buffalo Grove Real Estate Market Update

After an extremely solid 2015, Buffalo Grove Real Estate Market Trends for Single Family Homes have had a very solid start to 2016. Here are the February highlights with trend charts below.

Months of Supply of Homes for Sale

From an inventory perspective, average Months of Supply of Homes for Sale continues to remain very low at 3.1. Anything less than 6 months of supply is considered a Seller’s market.  Based on all reports, demand is exceeding supply, which should support higher sales prices.

Buffalo Grove Real Estate Months Supply of Homes

Buffalo Grove Single Family Homes for Sale

Buffalo Grove ended February 2016 at 111 homes for sale. This is a low figure, particularly when you account for the 65 new listings that hit the market in February.
Buffalo Grove Real Estate Homes for Sale

Closed Sales

13 Single Family Homes closed in Buffalo Grove in February 2016, 1 less than 2015. February is traditionally a slower month for closings, and with 39 homes going under contract during the month, 2016 on track to meet, and possibly exceed the total 2015 closings of 419.

Buffalo Grove Real Estate Closings

Average Market Time

Average Market times in Buffalo Grove were the lowest of any Chicago suburb in 2015, which makes the January figure of 128 days and February figure of 109 days noteworthy. We will track this number closely throughout the year in order to determine if this was simply an aberration. With the weather improving and the spring buying season upon us, it will be interesting to see how inventory and demand interact over the next couple of months.

Buffalo Grove Real Estate Average Market Time

Buffalo Grove Real Estate Market – 2015 Condos and Townhomes

Similar to Single Family Homes, Buffalo Grove Condos and Townhomes had an excellent 2015, and started 2016 with solid results in January and February. Here are the highlights with trend charts below.

Months of Supply of Home for Sale

From an inventory perspective, Months of Supply continues to decline to a ridiculous figure of 1.9. With only 60 homes on the market, it would seem like this is a great time to sell.

Buffalo Grove Months Supply of Homes for Sale

Buffalo Grove Condos and Townhomes for Sale

At the end of February, there were 60 Condos and Townhomes for Sale in Buffalo Grove. This is an extremely low figure, particularly when you account for the 34 new listings hitting the market in February. This general lack of inventory should put pressure on prices as we anticipate demand to increase this Spring.

Buffalo Grove Real Estate Condos and Townhomes for Sale

Closed Sales

18 Condos and Townhomes closed in Buffalo Grove in February 2016, an improvement of 1 from 2015. February is a traditionally slower month for closings, and with an impressive 26 homes going under contract during the month, we look to be on track to meet or exceed the total of 2015 closings of 373.

Buffalo Grove Closed Condos and Townhomes

Buffalo Grove Condo and Town Home Average Market Time

Similar to the Single Family Homes, we also saw a slight increase in average market time in February to 73 days.  This is still very low.

Buffalo Grove Average Market Time for Condos and Townhomes

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Elmhurst Real Estate Market: February Finished Fine

Elmhurst Real Estate Market:  February Finished Fine

The Elmhurst Real Estate market has been pretty healthy over the last few years with increasing sales, decreasing distressed sales and low inventory.

Elmhurst Closings

In the graph below, we see that 24 single family homes and 2 attached dwellings closed in February. Compare that to the 29 single family home closings at the same time last year and you’ll find a 17.4% decrease in the number of single family homes sold.  With only 2 condo/town home sales in February, compared to the 4 sold in February last year, there is a decrease of 50% of condos and town homes sold over February 2015.  Not a huge deal when looking at such small numbers.  Come March, we’d expect to see at least double the number of closings especially with contacts on the rise in February.

Elmhurst Real Estate Market Sales

Elmhurst Contract Activity

Single Family home contracts have seen an expected huge spike in activity with 59 contracts February, exceeding the number of contracts at this time last year which was 50. Contracts are an indicator of sales over the next several months so even though closings were down a bit, the following few months should seen an improvement.

Elmhurst Real Estate Market Contract Activity

Elmhurst Residential Property Market Times

Market times for single family homes were at 135 days and condos/town homes have risen to 140 days as of March 1, 2016, which is bit higher than we saw at this time last year.  Inventory continues to stay way lower than it was a few years ago and that contributes to the lower market times.

Elmhurst Real Estate Market Times

Elmhurst Residential Property Months Supply

The months supply for single family homes in Elmhurst is at 3.1, same as last month  Attached dwellings are at 3.9 months supply.  Anything under a 5 months supply is considered a sellers market. Again, favorable conditions for sellers.  And this level stayed this low even with 92 new homes being listed in February.
Elmhurst Real Estate Market Months Supply

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