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THE CARLSON LENOX GROUP
MONTHLY NEWSLETTER  
 CHICAGOLAND REAL ESTATE MARKET NEWS
Marlene Carlson, REALTOR, Broker, EPro                                                   April 2016
 
In This Month's Issue
  • 5 Exciting Trends in Chicagoland Housing
  • What's In A Comparative Market Analysis
  • Training Magazine Names Keller Williams #1 In Training
  • New or Used? Why Consumers Buy Certain Homes
  • 6 Top Reasons Why Not To Overprice Home
5 Exciting Trends in Chicagoland Housing

Chicagoland's housing market outperformed the national
averages in February.
 
While home sales stumbled on the national stage, the local Chicagoland market turned in a very solid February performance, according to the latest analyses from the Illinois Association of Realtors, MRED and the Mainstreet Organization of Realtors (MORe). From sales to home prices, the market continued on its positive path.
 
Here are the five most encouraging trends right now in Chicagoland housing:
 
1. Sales and Prices Grow - In the nine-county Chicago Primary Metropolitan Statistical Area, home sales totaled 6,095 in February, a 6.1 percent increase from Feb. 2015. Home prices posted even stronger gains, rising 7.1 percent year-over-year to $187,500.
 
2. The Purifying Nature of Home Sales - In his comments accompanying IAR's report, Geoffrey J.D. Hewings, the director of the Regional Economics Applications Laboratory (REAL) at the University of Illinois, called attention to the improving makeup of home sales in Chicagoland.   "Particularly important has been the consistent decrease in the percentage of sales accounted for by foreclosed properties in Chicago," Hewings said. "The influence of foreclosed properties on aggregate prices seems to be diminishing, while the foreclosure inventory remains at levels above those during the pre-recession period."   Indeed, according to a report from MRED, REO (bank owned property) sales were down 21.8 percent from a year ago, while short sales were down 14.8 percent. 

3. Low Inventories in the City  - Although home sales in the city of Chicago were up a relatively modest 2.1 percent, home prices were very strong, jumping 12.3 percent year-over-year. The rise in prices is due in no small part to the city's housing inventory, which continues to fall with no end in sight. According to the MRED report, the city's inventory in February was a 3.2-month supply, a 23.8 percent decline from Feb. 2105.

4. Suburban Strength - In Chicagoland's suburban housing markets, sales were up 6.9 percent year-over-year for detached single-family homes, according to MORe. Sales were particularly strong in the following communities: Hinsdale (up 171.4 percent); Gurnee (91.7 percent); Evergreen Park (81.8 percent); Orland Park (75 percent); Mount Prospect (69.2 percent); Oak Lawn (68.8 percent); Bartlett (68.8 percent); and Glen Ellyn (47.1 percent).  Lynn Madison, the president of MORe and owner of Lynn Madison Seminars, said consumer confidence is driving the suburban housing market.  "With the Fed showing signs of delaying any additional interest rate increase and positive indicators seen throughout our area, we're seeing a lot of reason for optimism," she said. "The market is ripe for new homebuyers to buy their first home and for existing homebuyers to upgrade to the home of their dreams."

5. Pending Strength - Finally, MORe also noted that pending sales in February spiked 27.8 percent, a signal of strong home sales activity in the coming months. The following areas saw huge jumps in contract activity:  Countryside (up 500 percent); Crestwood (350 percent); Burr Ridge (233.3 percent); Flossmoor (175 percent); Antioch (106.3 percent); and Wheeling (100 percent).
What's in a Comparative Market Analysis  (CMA)

A comparative market analysis is a report, usually compiled by a real estate professional right before your house goes on the market. A CMA gives you information (sometimes referred to as "comps") about houses similar to yours (in size, amenities, and location) that are either on the market, have sold, or were listed but expired (usually, because they were priced too high and no one bought) within a reasonably recent time period. It's ideal to have your CMA look back no more than three months when the market is in transition, and no more than six months in a more stable market.
 
A good CMA can tell you:
  •  what homes like yours are actually selling for
  •  how long it's taking for them to sell, and
  •  what their sale prices were in relation to their list prices (the difference between what people actually got for their house and what they asked for).
 
It's especially important to pay attention to the prices of pending, rather than closed, sales, for the basic reason that they're the most recent. I f you have the opportunity (on your own or with your real estate agent), visit some comparables yourself to see how houses on the market compare to yours in terms of price and other features.
New or Used? Why Consumers Buy Certain Homes
 
Why do some consumers buy new homes, while others buy existing homes? National Association of Realtors' (NAR) 2015 Profile of Home Buyers and Sellers provided the answer, and in our continuing coverage of NAR's report, we've assembled the following graphs on the topic:
Training Magazine Names Keller Williams #1 Training Organization In The World
 
On the same day that Keller Williams announced it was the largest real estate franchise by agent count in the world, Training Magazine named the company the world's #1 training organization across all industries. At a Feb. 9 awards ceremony in Atlanta to honor the Training 125, Keller Williams was recognized for the growth, productivity and profitability gains resulting from its world-class education and training programs.  
"Training fuels all of our success," said KW MAPS Coaching CEO Dianna Kokoszka.  "Our associates are the driving force behind the programming and training we produce," CEO Chris Heller said. "We're in business with agents who independently devote two to three weeks each year to participating in extensive training to build more productive and profitable businesses."
"We are honored to be named as the top training organization in business," Heller said. "As Keller Williams continues to expand, we will bring our training programs to new regions. At our core, we're an education-based, technology-driven company. And we're committed to providing our associates with the best training programs to help them grow their individual businesses."
6 Top Reasons Why You Don't Want to Overprice Your Home 

If you are considering selling your home, The Carlson Lenox Group at Keller Williams Preferred Realty thought you might be interested in understanding the dangers of overpricing:

1. Discourages possible offers  - An overpriced home discourages prospective buyers from making offers, if the difference between the asking price and the todays market value is substantial. Many buyers choose not to waste their time on overpriced homes, and prefer to spend their energy looking at homes that appear to be a good value.

2. Lost inquiries and showings  - Buyers who learn about the house for sale through signs, flyers or other advertising media will be discouraged with overpriced homes, and will not even inquire about them, nor seek showings. As well, the Buyers agent will concentrate showings based on the stated price-range preferences of the buyers. Just think of your own buying experiences. If you feel you are looking at something that is over priced, you will usually keep looking until you find a better value, and, you will not appreciate or continue to work with a sales agent who keeps recommending overpriced homes to you.

3. Low appraisal versus sale price  - Homes that are being financed by buyers must be appraised by the lender. If a home appraises below the buyers offered purchase price, the sale can be endangered... When a home does not appraise, several lenders will penalize the buyer for over paying. It is not unusual for the lender to increase their interest rate, size of the down payment, or deny the loan altogether. This in itself can kill the sale.

4. Helps sell other homes  - by overpricing your home you help sell your neighbors house by showing the buyers what a great value "THEIR" home is. This does not help your situation.

5. Lack of showings  - Buyers will avoid seeing a home they feel is overpriced.

6. Lower proceeds for seller  - it is proven that sellers who chase the market (by overpricing) versus sellers who are more aggressive with their pricing from the get go, end up selling their homes for much less, in the long run. As well, an aggressive sales price moves the home more quickly, thus reducing expensive holding costs.

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