Navigating the Spring Real Estate Market
As we enter into the real estate spring market (which surprisingly enough, begins in January), the Chicagoland real estate landscape is poised for some shifts. Join me in take a look into the spring 2024 market and explore the anticipated trends in the wake of decreasing interest rates and historically low inventory.
Interest Rates are on the Decline
Back in December 2023, the Federal Reserve (the United States’ banking system who’s responsibilities includes: setting interest rates, managing the money supply, and regulating financial markets), signaled three cat cuts in 2024. After mortgagee rates hit 8% in October 2023, we’ve already seen a decline in 2024 with the average 30-year fixed rate mortgage in the mid/upper 6%s and the average 15-year fixed rate mortgage around 6.1%. This is positive news for our Chicagoland home buyers who have been looking for a home, but who have sat on the sidelines due to the interest rates.
2. The Surge in Buyer Activity
The spring and summer markets have always brought out more buyers due to more favorable weather conditions, especially in the Chicagoland market. As interest rates continue to trend downward, we’ll continue to see buyer activity increase. This could leave homebuyers who were hoping to wait for warmer weather to purchase a home in an unfavorable situation with homes getting into multiple offers, fighting to for the home of their dreams, driving the price further up. If you’re looking to buy a home in Chicagoland in 2024, consider purchasing in the winter months when the buyer pool isn’t as demanding as the spring/summer market buyer pool. If you’re looking to sell in the summer of 2024 in the Chicagoland area, as long as your home is priced properly and in good condition, you can almost expect your home to receive multiple offers.
3. Challenges Amongst Low Inventory
Historically low inventory levels will pose another challenge in the 2024 real estate market, especially as we see interest rates on mortgages trend downward. To put how low inventory levels are into perspective, InfoSpark (an interactive data tool Real Estate Agents use to compare trends and to look at housing data), in January 2008, there were 98,070 homes on the market in the Chicagoland area. Today, we sit at at 16,514. Pair this historically low inventory with lower interest rates and we have a heck of a 2024 real estate market.
4. Strategies for 2024 Sellers
Pricing your home correctly the first time is still extremely important, even in a seller’s market. With the prices of homes being what they are, buyers are looking at value now more than ever. It’s almost impossible to under price your home in the market we’re in as buyer’s will find your home a good value and will naturally bid it up. If you overprice your home, you risk it sitting on the market for longer than the current average 44 days, making you a target for buyer’s to start low-balling you after a certain period of time. (Keep in mind, average time on market is hyperlocal and we can absolutely dive into what the average days on market in your city/subdivision is). Remember, if a home is priced correctly, given the minimal amount of homes on the market right now, the chances of your home getting bid up naturally is highly likely, but pricing IS KEY. As your Chicagoland Realtor, i’ll work with you to determine a customized strategy into pricing your home property, marketing it effectively, and ultimately selling it for a great price. I’ll also provide to you a Net Sheet, which will show you an estimated bottom dollar total of your profit after all fees are paid.
5. Tips for 2024 Home Buyers
Be prepared for multiple offers on “turn key ready” and well priced Chicagoland homes. As your Chicagoland Realtor, i’ll work with you on different proven and effective strategies in order to get your offer accepted without causing you unwanted stress or you paying over a certain amount for a home. Is a good rule to thumb to remember that if a home is going to go into multiple offers, it typically does so within the first week or so of being listed. Please note that this is not always the case, as it varies by the price point of home, but that’s the typical timeframe we see in the market. If you’re not wanting to compete for a home, take a look at homes that have been on the market for 30+ days and aren’t re-listed as “new”. You could also consider new construction homes as many builders don’t participate in bidding wars. Builders also typically offer some sort of move-in incentive such as down payment coverage and/or special financing rates which can drastically lower your monthly payment amount. To avoid bidding wars, you can also consider homes that may take a little bit of elbow grease to customize it to you and your family. The homes that we’re seeing fly off the market are ones that are completely move-in ready, so considering a home that may need some updating can help you avoid the stress of competing. As your Chicagoland Realtor, as we tour different homes, i’ll also talk you through similar homes that have sold in that area to determine is the home is priced well or high for the area which can help us strategize and put together a presentable offer.
