Q: What is the status of the current real estate market?
A: The market is, for lack of a better word, aggressive. There is a lack of inventory for buyers right now. There’s a stat that says for every Lincoln Park home, there are six buyers. So what’s going on is that things that are desirable and priced well, you have to anticipate moving quickly and not having a lot of time to necessarily process and digest what you’re buying. Because the properties that are desirable are moving that quickly. You also have to anticipate multiple offers, so a lot of times I’m recommending to my clients to bid as close to the list price as you can and you’re comfortable with, and to not really ask for a lot of concessions.
Q: Do you think that trend is more geared toward Lincoln Park and, say, River North and Old Town, or is it common for much of Chicago?
A: I think that it’s all over the place, especially the north side of Chicago, anywhere from Lincoln Park and Lakeview to Lincoln Square. And even some of the outlying areas like Jefferson Park or Edison Park. If something is desirable, if something has value, it’s going to go. So buyers don’t really have the ability to have cold feet. Once they’ve missed out on an opportunity, which inevitably is going to happen because either they haven’t gotten to the property fast enough or they just took their time with it, they learn quickly that that’s the case.
In Logan Square for instance, I have clients looking for two- and three-unit buildings, and they’re just not there. People aren’t selling because in that particular scenario, rents are increasing in that area because of gentrification, and owners see that. So when they do list it, and list it at a good price, they can anticipate that there are going to be multiple offers and they’re not going to be willing to concede on a lot of things, even after a home inspection.
I have a client buying in a high-rise market on Jefferson (downtown), and there were two issues that he had that, in a different market, he probably would’ve had addressed. There was some water damage to the floor near a sliding glass door, and there was a crack in the wall from the building settling. And unfortunately because he was the first offer in, and he didn’t offer full list price but they did accept it, the seller is not willing to give any kind of credit or anything. And my client is having a hard time digesting that.
Q: What is one common theme for a successful sale?
A: A seller that wants to get top dollar I think has to do some of the little extras. Clean their house up a little bit. Or maybe do a little bit of updating. Make the property present itself to where the buyer thinks they are getting the value. One of the things we run into is that buyers feel like they’re overpaying because they can go see public records for what someone acquired a property for, whether it be two months ago or seven years ago. And so ultimately, even though it’s not necessarily a buyer’s market at this time, buyers are still conscious of what they’re paying for something and want to want to feel like they are getting value even though the price is more than it was three, six or 12 months ago.
And that’s something you have to convey to the seller. The seller realizes they have a little more leverage than in previous markets, but people are still going to be the discerning buyer, especially when you get into higher price points. People are going to be a bit more savvy and realize when things are done at a bare minimum, realize when fixtures are less expensive. And when somebody tries to market something as luxurious or elegant or top of the line, it has to be that way and you can’t make short cuts. Sometimes that can come with just the little touches to make your home more contemporary.
One thing I notice is that people don’t put granite in their homes much anymore. In the million-dollar homes, they’re using quartz, limestone, things like that. So now what I’m kinda passing along to clients at a different price point is that by mimicking the same finishing techniques, you can give your property a bit of a distinction from the customary granite, back splash, things like that. Just to differentiate and give it a different taste or style.
… You start to see some similarities in a lot of properties, so anything a seller can do to separate themselves and their properties from everything else definitely helps. Get away from the same fixtures, the same finishes. Make the space feel as large as possible and make sure there is a flow to the house. No clutter, good aura, not choppy.