Looking at Chicago real estate market trends, buyers and sellers will each benefit this year.
According to economists, we can expect home sales to grow, prices for homes to rise and buyer demand to remain high due to the influx of Millennial and Gen Z buyers (we’ll talk more about that later). For buyers, you’ll continue to see low mortgage rates and more homes for sale due to high homebuilder confidence.
Before we dig more deeply into these optimistic marketing trends and how to plan ahead, let’s talk about two housing market influencers on everyone’s mind: the election and the pandemic.
Housing Market Influencers: the Election & Pandemic
We all experienced a pandemic during an election year. This situation is really one for the history books, but what did that mean for our housing market here in Chicago? Well, while we had to change how we did business by leveraging technologies such as virtual home tours to attract buyers, the market remained strong. But will the presidential changing of the guard impact the market this year? Here’s what the experts think:
Election – The housing market is one economic area where there is a thriving business with the numbers to back it up. For instance, the National Association of Realtors reported that home sales in the US surged in September 2020 to levels unseen in 14 years. Plus, home sales had risen 12 percent in the third quarter of 2020 — the biggest jump in seven years. With mortgage rates at historic lows, economists believe that the housing market will be one of the strongest sectors of the US economy. So, despite election concerns, the consensus seems to be that the housing market will keep growing.
Pandemic – While the pandemic spread through the US, the market remained strong. New home sales jumped 43% in August of 2020 compared to 2019. Why? Millennials are the driving demographic here. Again, lower interest rates, a large population of interested homebuyers, and the realization that owning a home might be the key to work-life balance in this pandemic-impacted environment are the key factors.
In Illinois, home sales have increased 29 percent in November 2020 when compared to the previous November. And in the City of Chicago? That number is 17.6 percent. It’s an impressive increase given these complex housing market influencers and the pandemic recession we’re currently experiencing. There is strength and resilience in the real estate market.
2021 Chicago Real Estate Market Trends: How to Plan Ahead
Now that we know what the experts think and how the election and pandemic will influence (or not) the current housing market, how can home buyers and sellers prepare themselves? Here’s my advice:
For Buyers
1. Take advantage of low mortgage rates before they go up. Realtor.com forecasts the rate will be up to 3.4% by the end of the year. In the long-term, lower mortgage rates save you money and lower your monthly costs. Now is the time to buy if you’re on the fence.
2. With high demands, the buying cycle is faster than ever. So, when you find a property you like, put your offer in quickly and expect a fast pace due to other interested buyers. This being the case, I always work fast with my clients to communicate with the home seller’s agent for quick responses. While rapid-fire negotiations can be nerve-racking, they are sometimes needed to end up with the home. I will do my best to make the process as simple and stress-less as possible.
For Sellers
1. Prepare for Millennial and Gen-Z buyers by marketing your home in 2021. Investopedia calls it “tech-oriented house-hunting,” and they couldn’t be more right. People in their late 20s and 30s have certain expectations when they shop. They want to view properties on their mobile devices, text message agents, and engage in all types of multimedia during their home buying journey. In the past years, I have noticed this trend myself, and this is why I market my clients’ homes through video tours, interactive brochures, and online to create enticing property landing pages that get views.
2. In a pandemic world, expect differences in how business is done. As I stated in the previous tip, you can expect online marketing to go a long way in attracting buyers. You can also expect communication through email and text messaging to avoid face-to-face meetings. Due to local regulations regarding social distancing, you may be asked to leave your home for a period of time while masked prospective buyers view your home. It’s all about managing safety to the level that is comfortable for both buyers and sellers.
Your 2021 Chicago Real Estate Guide
In 2021, we have so much to look forward to and be grateful for. The housing market in Chicago and nationwide is strong. The Chicago real estate outlook gives us an idea of what we can expect this year. Both home buyers and sellers have a lot to gain during their transactions despite the election and pandemic.
This year, allow me to be part of your home buying and home selling journeys. Several of my clients and I navigated 2020’s challenges, and I’m looking forward to bringing that working knowledge with me into the new year. Contact me today to get started.