Real Estate Blog

 

 

Disclaimer: This guide is not meant to be a resource for tax advice but instead a resource for basic information concerning only certain aspects of the new tax code and how they may impact the real estate market. You should get tax advice from your accountant or tax preparer who will explain how the entire tax code will affect your personal return.

This information comes immediately after the new tax code became law. Some of the information may be revised as the analysis of the new law evolves.

When the tax code was originally being overhauled by the House and the Senate, there were three major proposals being considered that would have substantially impacted the residential real estate market:

  • Changing the requirements for the
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According to recently released data from the National Association of Realtors (NAR), the median amount of time a home spent on the market hit an all-time low of only three weeks in 2017.

Strong buyer demand, a good economy, and a low inventory of new and existing homes for sale created the perfect storm to accelerate the time between listing and signing a contract. The time needed to sell a home has dropped substantially since its highest mark of 11 weeks in 2012.

The chart below shows the median weeks on the market from 1987 to today.

So, here is what you should consider:

The local Chicago market mirrors the national conditions. If you have been debating whether or not to list your home for sale, know that current market conditions are

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This is a rendering of the proposed 76 story residential tower in River North, as reported by Crains Chicago Business. Estimated to cost more than $700 million, the two tower development would occupy the block just West of Holy Name, at State and Superior Streets, and include 900 apartments and condominiums, a health club and spa and a grocery store. It would be one of the biggest residential projects ever built in downtown Chicago, with one tower rising 76 stories and the other rising 45 stories.

 

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There is no doubt that using the services of a licensed real estate agent when selling your home has many benefits. Among other services, the agent will provide: 

  • Greater exposure to more buyers
  • The skills of a professional negotiator
  • A layer of protection from possible legal liabilities
  • Professional guidance in navigating any pitfalls that may arise
  • A level of safety when showing the home

These services add a definite value to the process of selling - the question is, how much value? Seller who think these services are not providing the value of the fee a real estate agent charges, may decide do sell the home by themselves - For Sale by Owner, or FSBO. 

In most cases though, the services of a professional don't cost the

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Here are five reasons why it makes sense to list your home for sale this Fall: 

1. Demand is strong

The latest buyer traffic report from the National Association of Realtors (NAR) indicates that buyer demand continues to be very strong in most areas of the US. These buyers are ready, willing and able to purchase. Take advantage of the buyer activity currently in the market. 

2. There is less competition now 

Housing inventory is still below the six months supply that is needed for a normal market. Currently, there is still a shortage of houses on the market to satisfy the number of buyers. This could change soon. More homes are expected to come on the market next year as more owners are motivated to sell as home values increase and owners

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Spring is traditionally the busiest season for real estate. Buyers, strategizing and preparing their move all winter, come out in full force in search of their dream home. Homeowners, in anticipation of the increased demand, are motivated to list their house for sale and move on to the home that will better fit their needs.

New data from CoreLogic shows that even though buyers came out in force, as predicted, homeowners did not react to the increased demand and list their home in time to meet the buyers' needs. According to Frank Nothaft, Chief Economist of CoreLogic, the slow down of the sales growth was not due to a lack of affordability, but rather a lack of inventory. Data shows that as of Q2 of 2017, the unsold inventory as a

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According to a recent survey of the National Association of Realtors, 84% of Americans think that purchasing a home is a good financial decision. This is the highest percentage since 2007, which was before the housing crisis. There are five major reasons why people believe it is a good decision: 

1. Build equity, rather than paying rent

2. The opportunity to own a home free of a mortgage by retirement age

3. An investment that builds long-term wealth and increases net worth

4. Stable and predictable monthly mortgage payments

5. Mortgage payments allow for several tax deductions

To find out more about the benefits of purchasing a home this year, Ask Andreas for a free consultation!

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Home values continue to rise nationwide and many are wondering whether we are heading towards another bubble. Zillow recently reported that "National home values have surpassed the peak hit during the housing bubble and are at their highest value in more than a decade."

That is a correct statement but we must understand that just comparing prices of a decade ago does not mean we are at bubble numbers.

Here is a graph of median prices as reported by the National Association of Realtors (NAR).

It shows that prices rose during the early 2000s, fell during the crash and have risen since 2013.

For comparison, let’s assume there was neither a housing bubble or a crash and that home prices appreciated at normal historic levels (3.6% annually)

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If you are thinking of selling or buying a home, the most important decision to make is to hire the right real estate agent. Most agent are familiar with the process and can show you homes, but you should expect much more from them. Truly understanding the market is much more difficult as it seems, as we have all learned from the housing crisis. A real estate agent's job is to educate you so you can make the right decision for your needs. 

Here are a few questions you should ask your agent before you hire him or her: 

How does a change in mortgage interest rates affect buyer demand and seller's supply? 

As home prices are increasing briskly, is there a danger of another housing bubble?

Do you need a minimum of 20% down payment to purchase

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Some experts are wondering wether the number of homes currently being sold can continue at the same rate. The concern is that with a record number of people buying houses, we are heading towards another bubble and ultimately a crash. 

Let's take a closer look at the numbers: 

When you look at the last four years of home sales and compare them with the three years preceding the last bubble, there may be reason for concern. However, if you look further back in history, it is evident that the pace of sales is quite natural and healthy, as shown in the graph below: 

Bottom Line:

The current pace of home sales is normal and appears to be maintainable in the future. 

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