NAR REPORTS REVEAL TWO REASONS TO SELL NOW

We all realize that the best time to sell anything is when demand is high and the supply of that item is limited. The last two major reports issued by the National Association of Realtors (NAR) revealed information that suggests that now may be the best time to sell your house. Let’s look at the data covered by the latest Pending Home Sales Report and Existing Home Sales Report.

THE PENDING HOME SALES REPORT

The report announced that pending home sales (homes going into contract) "surged" by 6.1%. The increase was "the largest month-over-month gain since April 2010, when first-time home buyers rushed to sign purchase contracts before a popular tax credit program ended". Lawrence Yun, NAR’s chief economist, expects improving home sales throughout the rest of the year:"Sales should exceed an annual pace of five million homes in some of the upcoming months behind favorable mortgage rates, more inventory and improved job creation." Takeaway: Demand is beginning to increase dramatically compared to earlier in the year.

THE EXISTING HOME SALES REPORT

The most important data point revealed in the report was not sales but instead the inventory of homes on the market (supply). The report explained:

• Total housing inventory climbed 2.2% to 2.28 million homes available for sale
• That represents a 5.6-month supply at the current sales pace
• Unsold inventory is 6.0% higher than a year ago

There were two more interesting comments made by Yun in the report:

1. "Rising inventory bodes well for slower price growth and greater affordability, but the amount of homes for sale is still modestly below a balanced market." In real estate, there is a guideline that often applies. When there is less than 6 months inventory available, we are in a sellers’ market and we will see appreciation. Between 6-7 months is a neutral market where prices will increase at the rate of inflation. More than 7 months inventory means we are in a buyers’ market and should expect depreciation in home values. As Yun notes, we are currently in a sellers’ market (prices still increasing) but are headed to a neutral market.
   
2. "New home construction is still needed to keep prices and housing supply healthy in the long run." As new construction begins to be built, there will be increased downward pressure on the prices of existing homes on the market.

Takeaway: Supply is about to increase significantly. The supply of existing homes is already increasing and the number of newly constructed homes is about to increase.

Bottom Line

If you are going to sell, now may be the time.

JUNE SALES DATA FOR CHICAGOLAND

JUNE SALES DATA FOR CHICAGOLAND

June Property sales were 10,071, down -9.7% from 11,148 in June of 2013 and 4.8% higher than the 9,611 sales last month. June 2014 sales were at a mid level compared to June of 2013 and 2012. June YTD sales of 46,419 are running -9.4% behind last year's year-to-date sales of 51,262.

Prices

The Median Sales Price in June was $225,000, up 7.5% from $209,225 in June of 2013 and up 7.1% from $210,000 last month. The Average Sales Price in June was $292,519, up 4.2% from $280,772 in June of 2013 and up 7.4% from $272,461 last month. June 2014 ASP was at highest level compared to June of 2013 and 2012.

Inventory & MSI

The Total Inventory of Properties available for sale as of June was 39,075, down -1.0% from 39,472 last month and down -8.1% from 42,532 in June of last year. June 2014 Inventory was at the lowest level compared to June of 2013 and 2012.

A comparatively lower MSI is more beneficial for sellers while a higher MSI is better for buyers. The June 2014 MSI of 3.9 months was at a mid range compared with June of 2013 and 2012.

Market Time

The average Days On Market(DOM) shows how many days the average Property is on the Market before it sells. An upward trend in DOM tends to indicate a move towards more of a Buyer's market, a downward trend a move towards more of a Seller's market. The DOM for June was 52, down -10.3% from 58 days last month and down -17.5% from 63 days in June of last year. The June 2014 DOM was at its lowest level compared with June of 2013 and 2012.

Housing Market Update

Your Mid-Year Housing Market Update 

After an intense winter that kept many buyers and sellers indoors, the spring housing season has proven to be very active. From historically low interest rates to rising prices and tight inventory, here is a quick breakdown of the local Chicagoland real estate market.

Home Prices & Activity

Home prices continue to rise steadily with 20 consecutive months of year-over-year gains. The Chicago-area median home price rose to $190,000 in April, a 9.9 percent growth from April 2013. The number of homes sold has decreased by 7.8 percent over last year's numbers. This lack of sales is a result of a shortage in listings going on the market.

"Sellers who have been putting off a decision to list could find this spring is the right time to sell to take advantage of pent-up buyer demand and less market competition," said Phil Chiles, president of the Illinois Association of REALTORS®.

Inventory

April saw the most Chicago-area homes listed, more than any other month in the past four years. According to Matt Farrell, president of the Chicago Association of REALTORS®, "As buyers navigate their way through the home buying process, it can't be stated enough that if you see something you like, it won't likely be available a few days later."

Interest Rates

At the beginning of 2014, many mortgage experts predicted that interest rates would increase to five percent by the end of the year. However, rates remain at historic lows, and the monthly average commitment rate for a 30-year, fixed-rate mortgage for Northern Illinois was 4.34 percent in April. Fannie Mae and Freddie Mac are now predicting that interest rates may reach around five percent in 2015.

The housing market continues to change regularly, and I can help you make the best decision for your unique situation and hyperlocal market. If you'd like to learn more about your real estate options, please contact me.

New Home For around $2000

Luxury home doesn't always necessarily mean thousands of square footage, towering great 

rooms and gilded toilets. Take these homes for example: to begin building one of these epic 

houses, all you need is $2,000. That $2,000 will buy you a shipping container. What you

 do with that shipping container… well, that’s completely up to you.

Some creative people have found a way to transform this rudimentary “room”

 with metal siding into luxury housing that blows us away. These homes are epic.

1.) A shipping container doesn't have to be a closed space.

2.) Blue container? Run with it!

3.) Open up the metal boxes and let your imagination run wild.

4.) *jaw drops*

5.) The shapes are basically the same, but wow.

6.) Utilitarian… and awesome.

7.) The best part about this one is that you know they made it 

out of shipping containers.

8.) This open concept was taken a step further with a sliding garage door.

9.) You don’t rob this house. Ever.

10.) Modern, yet … not.

11.) This is the kind of home that keeps a person happy.

12.) Already-made pool? Yes please.

13.) Recycled materials AND it’s good for the planet.

14.) This collection of containers is just epic.

15.) These are so inspiring.

Source: Reddit

The best part of the gallery that this Reddit user shared? The shipping containers are 

recycled materials, so you’re actually helping the environment if you invest in making

 a luxury shipping container home. You can’t beat a base price of $2,000.

Open Floorplans Getting Closed Off? Demand Grows for Separate Kitchens

Open floor-plans have been in high demand in recent years, with buyers showing preferences for open kitchens and dining areas tucked into great rooms. But could that be changing? A New York Times article highlights a “separate kitchen comeback,” as some home owners say they want a more defined space for a kitchen and dining area. More new buildings are opting to feature separate kitchens and formal dining rooms due to a rising demand for separate corridors, according to the article.

Why are some home owners suddenly wanting to close off the interior of their homes again? Some point to a “dirty dishes” driver. Home owners are finding that when entertaining they prefer to have a separate kitchen space so their guests don’t have to see the food being prepared or look at the dirty dishes afterwards.

The separate kitchen and dining space also helps to remove one popular sticking point for home buyers: How to fit their existing dining room table into an open floor-plan? “The issue of where to put the dining table kills more deals than anything else in real estate. If a family is moving, the dining table is the one thing they say they can’t part with,” Barbara van Beuren, a managing partner with Anbau Enterprises, told The New York Times. Anbau Enterprises is developing new duplexes in New York City featuring dedicated dining rooms.

For some home owners, they’re preference for separate kitchens is more nostalgic. They desire it because it reminds them of their childhood home.

“So much new construction features open floor plans that there’s a pent-up desire for apartments with separate dining rooms and kitchen,” broker George Case with Citi Habitats told The New York Times. “They offer charm, they’re better for entertaining, and you don’t have to see your partner first thing in the morning. For a certain demographic, they’re a definite selling point.”

Some listing ads are even highlighting homes with a separate dining room, viewing it as a selling point. Some architects also are responding to the increase in demand with what they’re dubbing “hybrid kitchens,” using pocket doors that can be opened or closed to give home owners the option of an open or closed kitchen.

by Melissa Tracey 

Tips on staging to help sell your home

Candace Garvey's Tips on Staging a Home to Sell: http://youtu.be/dBYszJSuEcc

Say No To FSBO

Some homeowners consider trying to sell their home on their own, known in the industry as a For Sale by Owner (FSBO). We think there are several reasons this might not be a good idea for the vast majority of sellers.

Here are five of our reasons:

1. There Are Too Many People to Negotiate With

Here is a list of some of the people with whom you must be prepared to negotiate if you decide to FSBO.

• The buyer who wants the best deal possible
• The buyer’s agent who solely represents the best interest of the buyer
• The buyer’s attorney (in some parts of the country)
• The home inspection companies which work for the buyer and will almost always find some problems with the house
• The appraiser if there is a question of value
• Your bank in the case of a short sale

2. Exposure to Prospective Purchasers

Recent studies have shown that 92% of buyers search online for a home. That is in comparison to only 28% looking at print newspaper ads. Most real estate agents have an internet strategy to promote the sale of your home. Do you? (and craig's list just doesn't do it)

3.  Results Come from the Internet

Where do buyers find the home they actually purchased?

• 43% on the internet
• 9% from a yard sign
• 1% from newspapers

The days of selling your house by just putting up a sign and putting it in the paper are long gone. Having a strong internet strategy is crucial.

4. FSBOing has Become More and More Difficult

The paperwork involved in selling and buying a home has increased dramatically as industry disclosures and regulations have become mandatory. This is one of the reasons that the percentage of people FSBOing has dropped from 19% to 9% over the last 20+ years.

5. You Net More Money when Using an Agent

Many homeowners believe that they will save the real estate commission by selling on their own. Realize that the main reason buyers look at FSBOs is because they also believe they can save the real commission. The seller and buyer can’t both save the commission.

Studies have shown that the typical house sold by the homeowner sells for $184,000 while the typical house sold by an agent sells for $230,000.   This doesn’t mean that an agent can get $46,000 more for your home as studies have shown that people are more likely to FSBO in markets with lower price points. However, it does show that selling on your own might not make sense.

Bottom Line

Before you decide to take on the challenges of selling your house on your own, sit with us your real estate professionals, and see what we have to offer.