Those of us with retirement accounts have probably noticed the upward trajectory of the stock market over the past several months, but it shouldn’t go unnoticed that some key numbers are up in the national and Chicago real estate markets as well.
Are you thinking about buying your first home, or perhaps upgrading, downsizing or buying an investment property? Or maybe you’re searching for a home to buy or thinking about starting? If either case describes you, we invite you to join us for our two upcoming seminars on how to buy and sell a home in today’s market.
As one of Chicago’s top ten residential real estate agents (and #77 in the nation according to The Wall Street Journal), I am a frequent source for the media. I always enjoy the opportunity to share my “in-the-trenches” perspectives on Chicago’s residential market, as I believe that what is happening locally is more relevant to Chicago homeowners than generalized national reports.
Unfortunately, as with any interaction with the media, there’s the risk of having one’s comments taken out of context, and that is precisely what happened in my July 2009 interview with Stephane Fitch for his Forbes magazine story entitled “America’s Most Troubled Luxury Neighborhoods.” Fitch distilled our 30 minute interview into two quotes that, out of context, contradict the key points I made in our interview. Having my name associated with misleading information about Chicago’s real estate market, and especially about the Lincoln Park neighborhood where I was the #1 selling agent in 2008, is troublesome.
So, I’d like to set the record straight: Chicago’s Lincoln Park is not a “troubled” neighborhood. While I cannot comment on the other neighborhoods mentioned in his story, I disagree with his assertion that home prices in Lincoln Park are on the verge of “collapse.”
That was the question my friend Marilyn Stotts asked me during a recent gathering at a local restaurant. Not, “Where is your house?” “Do you like your house?” “How big is your house?” Or even the open-ended conversation starter, “Why did you buy your house?” But instead, “When did you buy your house?”
The fact is that with the rise and then fall in home values that has taken place in the last decade, the timing of your purchase is a good indicator of whether your home is worth more or less than you paid.
When I meet with prospective home buyers, one of their first questions is inevitably, “How low below the asking price should I expect to pay?” My answer is always the same… it depends! Some homes are priced fairly and others are grossly overpriced. I cannot recommend a generalized strategy as we need to weigh the merits of each home individually against their prices.
When my team and I work with a seller to list their home, our strategy is to determine the home’s approximate market value, and then offer it for sale for as close as possible to (or even slightly below) that number. This strategy is especially important in a declining market. If we were to tack on an extra 10% of “wiggle room” onto our asking price, and then the market dropped 5%, we would be 15% above the market. The larger the gap between market value and asking price, the greater the chance that the right buyers will not see your home. Rather, buyers in the market for a more expensive home will see yours, and it will pale in comparison to the competition. The most effective strategy is to price slightly below the market so your home is the “best in its class.”
|Top agents across the country, like my colleague Barbara Puff, can help you find great vacation properties such as this one in Arizona.|
Around this time of year, many Chicagoans are ready for a vacation, my family included. In our case, however, with three children under four years of age, hotels are not a good option. Shuttling the boys to a restaurant and back for all their meals is anything but relaxing, and we need more than just a place to sleep.
In anticipation of this, we purchased a condo in the Colorado Rockies – an area that offers year round recreation. We head out there when we can to ski, fly-fish, hike, swim, and generally decompress. A couple days of clean mountain air and crisp blue skies is a fantastic way to recharge, and our boys love it.
If you are suffering from a bout of spring fever, you might also consider buying a vacation home instead of renting or staying in a hotel. Prices in many resort destinations have fallen significantly – far more than home values here in Chicago. There are some amazing opportunities out there. Someday, we will look back at 2009 and wish we had picked up an extra property or two when prices and interest rates were low.
Chicago’s new 758-unit Trump Tower made front page news again yesterday after a Sikorsky S-61 helicopter spent more than four hours in blustery conditions on Saturday delivering the building’s communications “spire.” Now, Chicago’s newest luxury hotel and condominium building is officially the second tallest building in the United States at 1,361 feet – just 90 feet shorter than the Sears Tower.