Planning for 2021: Interest rates, a vaccine, and a seasonal market
While Chicago’s Fall real estate market activity has continued to hold strong, we are starting to notice some trends as we head into Winter:
For buyers – Less high-quality inventory on the market, extreme buyer competition, frequent multiple offer situations, buyers perhaps not getting a great deal in terms of sales price price, but still opportunities out there for our buyers especially when you consider the current mortgage interest rates.
For our sellers – We are noticing lots of competition in the city’s popular neighborhood, near downtown especially, with plenty of supply for buyers to choose from. In this environment it can be difficult for your property listing to stand out. Some of our clients are now beginning to wait out the fall and winter for some inventory to clear.
Obviously for buyers right now there are incredible interest rates:
These rates are compelling many to shop now, creating that strong demand we’ve been seeing. And while very low interest rates can be enticing right now, we think it is likely that those low interest rates will remain available for some time.
Coinciding parallel to Chicago’s real estate market is, of course, the current COVID-19 health crisis. While it has been devastating to us as a society, the market has not only remained unscathed, it has really carried on and surged.
As Joe Cahill from Chicago Business points out in his recent article, it is not too early to begin planning for a future where a vaccine is widely available, and there is an even more increased appetite for people to get out there, socialize and participate in the market. The timing will coincide with Chicago’s typical “spring market” surge of activity, and with the expected arrival of a COVID-19 Vaccine.
This combination of factors, we predict, will result in a potentially extremely competitive market. One in which buyers must be prepared to navigate quick multiple offer situations to secure the best properties, and sellers will need to be very smart and sensitive to their particular market’s conditions to maximize potential sales price.
We do believe buyers in the Spring may be in a better position overall, as prices seem likely to fall, and interest rates seem likely to remain very low. Sellers who list their properties too high today and gain many days on the market may then get desperate, and true deals may be found for buyers when fresh inventory drives older listing prices even lower.
If you are going to be buying in the spring market, it’s a good idea that you know your game plan today. That you know the whole process, and you have your dream team beside you: Lender, Broker, Attorney, and Inspector.
Check out this roadmap which outlines the steps involved in purchasing a home. Are you familiar with all of them?
Even if you may not be purchasing your home until spring, as you can see there are a couple steps to take before even touring properties. The first and one of the most important steps is engaging with a mortgage lender. They will help you get pre-approved for a loan, which is essential to have ready before you tour that dream property, so that you can submit a compelling offer quickly and confidently.
With a few months until spring, now is a great time to start having these conversations. Then with a better understanding of your entire budget, begin the process of touring properties. It will help you get a better feel for what is out there, and what you may like and/or dislike in your future home. Checking things out in person with an experienced broker provides a lot more insight than simply looking at listings on Redfin, for example.
Looking to Buy?
Contact us to start your search! We will immediately put you in touch with one of our brokers who can talk to you more about the process. We can even connect you with Lenders and Inspectors to help build your dream team.
Looking to Sell?
We can help you take advantage of high prices in the market right now and/or help you build a listing game plan for the spring! Contact us here to talk to a listing specialist.