In many neighborhoods across Chicago, we have extremely low inventory and incredibly high demand. Chicago is experiencing an ultra-competitive seller’s market, which means buyers typically compete against multiple offers for their dream house. How do you make your offer stand out? 

First of all, consider the price. When Chicago was in a more balanced market, you might have been able to start off with a lower offer knowing that the seller would counter. You can’t do that today because the seller won’t even consider your offer. You need to start off very close to listing price. In certain neighborhoods, you may even want to offer above asking price.

Earnest money is also important. Typically, earnest money caps out at about 5%. I recommend putting down 10% in earnest money in order to prove that you’re serious and financially responsible enough to buy the home.

Finally, pay attention to closing terms. If you can close quicker, that could make the difference in winning the bid, especially if you are up against a contingent buyer who needs to sell their property first. If you can close sooner, by all means, make that clear to the buyer. 

Of course, these tips will only be successful if you are pre-approved. If you need to get in touch with a lender, or if you have any questions about today’s video, just give me a call or send me an email. I would be happy to help you.

Whether you're

putting your home on the market this year or in the next five years, it is a

smart decision to start building your home's resale value now. Here are some

ways to create a comfortable home while making it easier to put more money into

your bank account on closing day.

If you think that home

maintenance on the weekends waste your time and energy, think again. The small

chores you do around your home prevents it from losing value. Neglecting small

maintenance and repairs causes 10% of your home's value to walk out your door

and slip through your windows. Most appraisers claim that homes showing little

to no preventative maintenance can depreciate from $15,000 to $20,000.

A study conducted by researchers at the University

of Connecticut and Syracuse University shows that regular maintenance boosts

your home value by about 1% per year. However, ongoing maintenance costs offset

that value, which means that regular maintenance actually slows down your rate

of depreciation. Furthermore, because home buyers generally notice any repairs

needed upon buying a new home, proactive maintenance lets the home buyer know

that he or she will not have to spend extra money to maintain the basics. This makes your

home more attractive, and thus more likely to get higher priced offers.

Maintaining the basics can cost

you little money and certainly some effort, but there’s a way to accomplish

this very important activity smartly. This article by HouseLogic,

for example, shows you

how to keep home maintenance below $300 a year. 

Planning ahead will also help make maintaining your home easier. Most

professional appraisers and real estate agents recommend a proactive

maintenance schedule that includes:

·        

Keeping

enough cash on hand to replace systems and materials

·        

Creating and

following a maintenance schedule

·        

Planning a

room redo every year

·        

Keeping a

notebook of all your maintenance and repairs

The Virginia Cooperative

Extension at Virginia

Tech published a study that shows

landscaping can increase a home's value by 15%. 

The study claims that a home valued at $150,000 could increase its value

between $8,300 and $19,000 with the addition of landscaping. Particular

landscape elements add different value. For instance, landscape design can

increase your home's value by 42%, plant size can increase your home's value by

32%, and diversity in plants can increase your home's value by 22%.

If your entry doors are wood,

consider switching them out for either fiberglass or steel doors. Steel doors

add style and architectural interest to your home while improving security; you

can add a deadbolt and electronic keypads to keep out intruders. Unlike wood

doors, steel doors do not rot or splinter.

Alternatively, fiberglass doors

can be designed to look like wood doors and give your home a modern look.

Fiberglass doors conserve more energy than steel doors.

Price-wise, a steel door will cost

you $1,335 with a 91% return on investment whereas a fiberglass door will cost

you $3,126 with an 82.3% return on investment.

At first, you might not think

that your garage door increases the value of your home. However, your garage

door distinguishes your home from the other homes on your block. As the largest

entryway of a house, garage doors get noticed first because they're the focal

point of your home. If you want to quickly increase the resale value of your

home, you need to make the most of this space.

Some interesting things being

done with garage doors include:

out more.

complement the color of your home, or you can build a concept around the

color of your home.

garage doors that look like wood garage doors. This gives your home a new

level of sophistication.

improve the aesthetic of your home, and provide light into your garage so

that it's no longer a dark space.

More importantly, a garage door

replacement will cost you $1,652 and add $1,512 to the value of your home;

that's a return on your investment of 91.5%.

While energy efficiency is still

not the sexiest selling point of your home, installing fiberglass attic

insulation saves energy and garners a big payback on your investment. According

to Remodeling Magazine's 2016 Cost vs. Value top trends report, fiberglass attic insulation gained

the top return on investment among the 30 projects in this year's report. Using

Remodel/Max as the cost source, a fiberglass attic insulation project cost

$1,268 nationwide.  Real estate

professionals surveyed estimated that the work would boost the price of a home

at resale, within a year of its completion, by $1,482. That's a 116.9% return

on investment.

Replacing your windows is another

way to save energy and increase your home's resale value. Replacing your old

windows with energy saving models will beautify your home, keep it comfortable,

and ease the workload of your HVAC system. According to HGTV, you'll see a reduction in your utility bill

by 7% to 15%. However, if you're selling your home, you could expect a 60% to

70% recoupment of your investment. The two types of replacement windows that fetch the

best return are vinyl

and wood. 

Kitchen remodeling can get

expensive, but small renovations can make your home more buyer friendly.

Changing your kitchen's texture and color using a matte finish and neutral

colors such as putty or grey enhances your home's resale value. Because matte

finishes have transitional qualities, your potential homebuyer can easily match

his or her stainless steel or black and white appliances. Also, refinishing

cabinetry, or switching to Energy Star™ appliances provide comfort you like and

pizazz buyers adore.

Flow is important to any interior

design of a home. If you feel that your kitchen hinders a good flow, change it.

A small investment to knock out a non-structural wall or remove a kitchen

island creates space and provides flow that buyers love.

A minor kitchen remodel can cost

you $20,122 while putting $16,716 of resale value into your home; that's an 83%

payback on the project. If you want to do a major kitchen model, this can cost

you about $60,000 and put about $39,000 of resale value into your home, which

is only about a 65% payback on the project. Therefore, consider a minor kitchen

remodel first.

Likewise, carefully consider

adding a bathroom or remodeling your bathroom. Switching out your frosted glass

shower doors for glass doors, cleaning the grout, replacing the shower and

floor tiles, switching out your sink or toilet, or replacing your sink and

shower fixtures can cost you little money.

Adding a bathroom can get

expensive, but it can reduce congestion during hectic times and provide your

guests with a bathroom. Consult with your real estate agent or a local

appraiser before deciding whether a full remodel or addition is right for your

situation. While a bathroom remodel will cost you about $18,000 with a return

on investment of about 66%, a bathroom addition will cost you about $42,000

with a return on investment of about 56%. Therefore, it's best to do your due

diligence before working on your bathroom.

Buyers' Wants

On that note, if

you need to renovate your home, be sure to consider how those changes will

affect its appeal to future buyers. Knowing design trends will give you the

opportunity to make changes to your home based on where your needs

and your potential buyer's desires intersect, thus increasing your property's

resale value drastically.

Designers and

design websites provide great ideas when you’re brainstorming home renovations.

Keep in mind as you research, however, that you don’t want to sacrifice your

needs for a comfortable home just for the sake of what you think a future buyer

will want!

Therefore, before

you begin making any changes to your home, consult your real estate agent. Real

estate agents, because we are constantly working with new buyer clients, have

insider insight into what homebuyers are looking for now and in the

future. We’ll be able to help you make smart choices when remodeling or

renovating your home.

If you think you

might want to remodel or renovate your home in the near future, or if you are

just curious about other ways you can increase its resale value, please reach

out to me! 

I’m honored to have my attorney partner, Kevin Mitrick, with me today to discuss the importance of having an attorney on your side when buying or selling a home in Chicago.

In general, attorneys charge anywhere from $595-695 for real estate transactions. This is a flat fee, and the attorney will be doing various things from contract to closing.

Primarily, an attorney will review the contracts and maximize the benefits while minimizing the risks to the seller. The attorney will also attend the closing and review the documents a final time before you sign. If your original attorney cannot attend, another will be called in place. In the state of Illinois, it’s very uncommon for a title company to assist in interpreting and signing documents because it borders very closely on providing legal representation, which is illegal for them to do.

If you need to contact Kevin directly, you can reach him at [email protected] or you can reach out to me and I’ll track him down for you. Here is one example of a real estate attorney contract.

If you have any questions about Chicago real estate, then I’m the one to ask. I look forward to hearing from you!

Kevin Mitrick, an attorney with Spain, Spain, & Varnet P.C., focuses primarily on the representation of buyer and sellers in real estate transactions. Today, he joins me to answer the question, “What is a tax proration?”

In Cook County, taxes are billed bi-annually and based off the previous year. The first installment is always 55% of the previous year's full tax bill. When a transaction closes, there will be a period of taxes that have not been paid yet, generally from the day the last bill was issued through the day of closing. At times, that can be a lengthy period. The goal is to come up with a calculation that both the buyer and seller agree with.  

Although that can be difficult, buyers want to maximize the tax credit while sellers want to minimize the tax credit. Generally, the tax credit covers 100% to 110% of the prior year’s bill. That’s the basis for calculating the tax credit.

If you have any questions for Kevin, you can reach him at [email protected] or (312) 788-7684. As always, if you have any real estate questions, give me a call or send me an email. I would be happy to help you!

If you’re thinking about selling this spring, rethink your strategy. There’s a huge advantage to listing your property now before the spring market comes along. Today, we’ll discuss the top three reasons why.

Overall, demand is strong. Although springtime is the busiest selling season of the year, the market still experiences lots of activity during the winter. When you compare this January to last January’s numbers, you’ll see demand is up by 8.4% in the city of Chicago.

There’s less competition now. Inventory is down, and buyers have fewer options to choose from. From a quantitative measure, we’re down by 4.7% in the city of Chicago.

If you’re thinking about buying or selling a home in the Chicago area this spring, please reach out to me at your earliest convenience. Let’s take advantage of low inventory and strong demand right away. Call or email me!

Today I want to talk about selling your home. Specifically, I am going to talk about why you need to sell your home twice in order to reap the benefits. 

The first time you sell your home is when the property is on the market, properly priced and marketed, a buyer submits an offer, and you accept it. That’s the first sale.

Then, unless the buyer is paying in all cash, they will be required to have an appraisal contingency. The appraisal is the second sale. The appraisal must meet or exceed the contract price in order for the financing to go through. If the appraisal does not come in at or above the contract price, I always advise my sellers to fill out an appraisal questionnaire online whenever there is doubt. The questionnaire is detailed and will cover all the figures that go into your home’s price. We will then send this over to the appraiser.

So remember, the sale of your home is not complete when you come to terms. It also has to pass the appraisal test and if it doesn’t, the deal will fall apart. If you have any questions for me, don’t hesitate to give me a call or send me an email. I look forward to hearing from you!

Today I have Rick Pantoga with me, my local mortgage lending expert here in Chicago. He's going to be explaining some important changes that the real estate market will be experiencing this year. He's been in the business for 29 years, so he's seen both the good and the bad.

On October 3rd of this year, the real estate market saw some big changes. What exactly happened?

It's because of the recent changes that came to the TILA-RESPA Integrated Disclosure (TRID), and this will affect everyone involved in real estate, from consumers to Realtors to lenders. The Consumer Financial Protection Bureau (CFPB) issued a final rule amending regulations the Truth in Lending Act as well as the Real Estate Settlement Procedures Act.

So, what does this mean for you? The TILA-RESPA rule consolidates four disclosures for closed and credit transactions secured by real property into two different forms.

One of these forms is a loan estimate that must be delivered or placed in the mail no later than the 3rd business day after receiving the consumer's application. A closing disclosure must be provided to the consumer at least three business days prior to consummation.

The TILA-RESPA rule includes some new restrictions on certain activity prior to consumers receiving the loan estimate. These restrictions include imposing fees on a consumer before the consumer has received the loan estimate, or requiring submission of documents verifying information related to the consumer's application before providing the loan estimate.

Please don't hesitate to contact us with any questions about this issue. We understand that it may seem a little confusing or overwhelming. We would be happy to clear up any misconceptions that you may have!

Today I want to talk about the importance of staging your home when you sell it in Chicago. It's a very easy way to maximize your sale price in Chicago.

I had a 3 bedroom duplex property in Humboldt Park, and the owner paid $1,500 to have it staged. This included consultation and the design elements such as the furniture. This particular client was even staying there while it was staged, and he said that the stagers were very courteous and stayed out of the way as much as possible.

As you can see, the staging really makes the unit pop, and the buyers commented on the design elements. This leads me to believe that it played a significant role in their decision to purchase the property.

So, what was the return on the investment?

Well, a similar duplex nearby sold for $335,000, but my client's apartment managed to sell for $362,500. That's a difference of nearly $28,000. My property sold for 94% of the list price.

My client spent $1,500 and got $28,000 back. I'd say that's an investment worth making!

If you want to get the listing or staging process started, please don't hesitate to contact me! I know a wonderful stager and would be happy to put you in contact.

I look forward to speaking with you!

Today, I want to share a quick marketing tip with you to help you attract attention to your home when selling. There are many strategies we can utilize to get your home the broadest possible audience, but today we want to focus on the 10 tips for marketing your home before listing it on the MLS!

Note: written permission is required to market your home Pre-MLS. This is known as the exemption period. I just want to properly disclose that this specific marketing requires written permission for homeowner. 

If you have any questions about the techniques we use to get your home sold fast and for top dollar, don't hesitate to give us a call or shoot us an email. We would love to hear from you!

Today, we'll discuss buying versus renting. There are three main points that I want to make about buying and renting in Chicago's current market.

The first thing to consider is rental affordability. A recent Zillow survey published in Crain's magazine revealed that in Chicago, renters typically pay 31% of their total income, while homeowners pay 14% of total income. Rental demand is skyrocketing, but percentage-wise, the monthly payments are considerably higher than mortgage payments.

Next, think of real estate as a financially leveraged instrument. That means that for a relatively small down payment, you acquire a very large asset when you buy a home. You do not need to put 20% down on a home; we will work with you to come up with a manageable down payment, such as 5% or 10%.

Finally, whether you're renting or buying, you are paying a mortgage anyway. Renters pay the mortgage by paying a landlord. If you're going to pay a mortgage, it might as well be your own. That way, you can build wealth and reap the tax benefits.

As you can see, there is an advantage to owning a home here in Chicago. If you have any questions on today's video, give me a call or send me an email. I would be happy to help you!