Chicago Real Estate Podcast with The Z Team

Buying a new home while selling your current one is a difficult thing to do. Luckily, we have some tips that will help. Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation How do you make an offer on a property when you haven’t sold your home yet?  This is a question many people have, especially in today’s real estate market. The task may seem daunting. However, there a few things you can do to make balancing the work of buying and selling simultaneously easier.  One of the first options I offer to people who are trying to buy and sell at the same time is to submit an offer that is contingent on the sale of your current home.  In my experience, the downside to this is that the seller will oftentimes reject this kind of offer. In today’s market, sellers may be unlikely to hinge the sale on circumstances beyond their control. If this is the case, there are two things that most often happen. Either the seller will ask you to drop the contingency or will ask to sell their home first.  The second option to try if you are buying and selling concurrently is to list the home you are selling at a price that is geared toward a quick sale. We will buy your home in the event that it doesn’t sell within a specific period of time Pricing your property correctly is one of the best ways to move it off the market as fast as possible and get you a contract as soon as possible. If this happens, then you may submit your offer contingent on closing the current home. In this case, the seller is more likely to accept the contingency than they might be in the option we discussed previously.  Finally, the third option is to use a guaranteed sale or trade-in program. In this option, we will buy your home in the event that it doesn’t sell within a specific period of time, at a certain price point, so that you can submit your offer on the home you want.  To learn more or if you have any other questions, give us a call or send us an email. We look forward to hearing from you.

Today we’re talking about strategies that you can employ to help win in a multiple offer situation. Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation Today I wanted to talk to you about some strategies that you as a buyer can use to win in a multiple offer situation. 1. Minimize your contingency amounts in the offer. Most of the time you’re going to have mortgage and inspection contingencies, and if you can minimize those amounts then your offer will stand out. 2. If you’re comfortable enough to buy the home as-is, then that’s a great idea, but only if you’re comfortable. It will still allow you to do an inspection and back out from the contract if there is something wrong with the house, but many sellers will favor that type of offer over others. 3. Put together a letter to include with your offer to the seller that tells the seller why you love that home and why you want to buy that home. Most sellers spent a lot of time in that home and put a lot of heart into the home, and they want to pass the home onto someone who will take care of it as well. 4. Find out what the best terms are for the seller for closing on the home. This means what time frame and how long they want to live at the home before closing. If you can’t find that information, the best idea is to put in at the closing date, “per seller choice.”  5. Use an escalation clause. If you’re not sure how much you want to offer as a maximum bid, you can include that clause that says you’ll pay a certain amount more than the second-highest offer up to a maximum amount. It includes the condition that they have to disclose that offer if you are the winning bidder.Sometimes you’ll be surprised that the best price is not always the determining factor. Sometimes you’ll be surprised that the best price is not always the determining factor. For sellers, in this situation you will typically get the best price for your house. Sellers want to keep the urgency in multiple offer situations. They should keep a 12- to 24-hour deadline when asking bidders for their highest and best price.  You will see that when the buyers submit their best offers, they will offer a price that is above comparables. That’s usually an indication that the home will not appraise. So a good idea as a seller is if you accept the highest offer, you include the condition to the buyer that if the home does not appraise, they are willing to pay the difference and you don’t have to reduce the price. If you have any questions about this or any other real estate topic or you’re looking to buy or sell your home, give me a call. I’d be happy to help.

I’m back to answer another one of your great questions This one has to do with school districts. Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation I’m back to answer another one of your great questions. This week’s question is, “I want to move to a better school district for my children, should I wait for the market to improve first?” This is actually a two-part question. The first question is if you should move to a better school district. If that’s something important to you, the answer is absolutely yes. I don’t think anyone should rely on the market when making this decision. If there is a way to make it happen, I think you should.Don’t rely on the market when making this decision. Now, the second question is “What do I do with my existing home?” If you bought it at the peak of the market and its value isn’t quite where you want it to be yet, you have a few options. The first is to check the property’s cash flow. If you rented it out, would you be able to cover all of its expenses and create a positive cash flow? If there is, then it might make sense to rent out the property and buy or rent another one. Then you can sell once the equity is back where you want it to be. If the existing home won’t give you a positive cash flow, I think you should bite the bullet and sell. Buy another house in your new school district and start building equity there. If your goal is to set up your kids for success in the future, I wouldn’t wait. Make the move now. Each case is different, however. If you have any questions for us about your individual case or anything else relating to Chicagoland real estate, give me a call or send me an email. I would love to hear from you.

Determining whether a property is better off sold or rented out takes time. You’ve also got to answer a few questions about the property. Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation When upgrading to a new home, should you sell your old home or simply rent it out instead?  I think the better question is, “Is this a good investment for your particular situation?” To keep your existing home as a rental property, there are a number of things you should consider in advance. Here is my blueprint for determining if a property is better suited for selling or renting out. The first question I ask is, “Will it generate cash flow?” If you decide to leave your home as a rental, what will the rent be and how much are your expenses? Factor in mortgage taxes, insurance, and property management fees if you’re going that route. If there is cash left over after all that, that’s a good start.Will it generate cash flow? The next thing will be to determine the actual rate of return on the investment. Every investor has a different appetite for ROI. My rule of thumb for single-family homes is a ratio of 1:1. In other words, if I buy a home for $200,000, I want the rent to be approximately $2,000 per month. If you buy a home for $300,000 but the area only commands $1,200 in rent, it’s not a great investment.  Finally, you need to see if you can qualify for another mortgage. If you can’t, you’ll likely be forced to sell. If you can, however, and the property passed all the previous tests, I would call it a very sound investment. If you have any more questions for me, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.

In a seller’s market, getting the highest price possible isn’t simple. It involves morphing your traditional home sale into an empowered one. Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation How do you get the best price out of your home in a seller’s market like Chicago? This is a great question, but I think the better question is “How do I switch my traditional home sale to an empowered home sale so I can get the maximum amount of money for my house?” The way to do that is to change the way homes are sold in that particular market. Traditionally, agents create marketing that focuses on bringing in one specific buyer who will come in, schedule a showing, and possibly bring you an offer. When you get into negotiations with that buyer, it can sometimes leave you wondering if you left a better offer on the table. I think every seller in the market should use this strategy. Empowering your marketing approach involves switching your focus from one buyer to many. Instead of trying to bring one buyer on the market to the home, you want to bring the entire market to that home. By doing that, you can create competition and urgency among buyers. This all but guarantees you to get the best price possible. I think every seller should use this strategy in a seller’s market like this. Making the switch to an empowered home sale involves a lot of strategy. A solo agent can’t do it on their own; you need an entire team. If you have any questions for us or are interested in learning about how we can make your home sale empowered, give us a call or send us an email. We look forward to hearing from you.

How can you make your home more appealing to millennial homebuyers when selling? I have a few tips to share. Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation What's the best way to sell a home to millennial homebuyers? Millennials don't really care about square footage, unlike the baby boomers. They're generally OK with ranch-style homes as long as it has an open floor plan, as well.  Millennials also value their neighborhood very highly. In fact, neighborhoods are more important to millennials than the houses themselves. My colleague has a joke that all millennials need are Wi-Fi and a great common place to hang out.There's a joke that all millennials need to buy a house is Wi-Fi and central hangout spot. Environmental features are also very important to millennials. This includes things like LED lighting or solar panels because millennials want to have an impact on the world. As for home designs, millennials tend to look for clean, bright, and modern home designs. They don't care as much about big furniture and big spaces. Finally, you want to reach out to millennials online to sell your house. They won't drive through neighborhoods to pick up fliers or look through the newspaper. You want to appeal and communicate the features that they like on the Internet. If you have any other questions about selling your Chicagoland home, you can always give me a call or send me an email. I'd be happy to help you.

What’s going on in the Chicagoland market? We have a healthy market with inventory levels that benefit people selling their homes. Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation How’s the Chicagoland market doing right now? It’s doing great. There are three numbers that tell us this: inventory, days on market, and the list-to-sales price ratio. We currently have 44,000 homes on the market right now, which seems like a lot. It’s actually not many compared to three years ago when we had up to 70,000 homes on the market.  We currently have 4.2 months of inventory, which is a healthy market that’s good for people selling their home. Throughout the Chicagoland market, there are more people looking to buy a home than there are home sellers. A truly balanced market has about six months of inventory. Our current market has a healthy level of inventory, but it also favors sellers. Our average days on market is about 90 right now. It’s higher in some neighborhoods and lower in others, but on average, homes are staying on the market for about three months before selling. Some neighborhoods have a higher average number of days on market because sellers there add too much of a cushion to their list price and expect buyers to negotiate them down, but it never happens.  The list-to-sale price ratio is at 97.1% in our market currently. Basically, buyers are negotiating the list price down about 3% on average.  These are the numbers that paint the picture of our market, and they’re very strong. I certainly hope they stay that way in our market this year. If you have any questions about this topic or you’re thinking about buying or selling a home in the Chicagoland market, give me a call or send me an email. I’d be glad to help!

When is the best time to sell in 2017? Right now, actually. Here’s why.  Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation We’re answering another great question today. This one is particularly relevant to our current market. The question is, “When is the best time of year to sell a home?”  The best time of year to sell a home, at least in 2017, is right now. I’m actually selling my home right now because I believe the market is that good. In Chicagoland, everyone thinks summer is the best time to sell, but that’s not really true. Some years, summer is better and some years, winter is better. In the summer, we definitely have more sales. At the same time, inventory increases greatly during this time as well.  Right now, we have record-low inventory levels in most neighborhoods, and we have more buyers than sellers on the market. I wouldn’t be putting my home on the market right now if I didn’t think it was such a good time. I don’t think conditions will be this good in the summer. We’ll have more sales, but the increased inventory lowers your chances of selling for top dollar.I’m actually selling my home right now. I recently came across a report from Redfin, who did a study that showed that listing in the winter gives you a 9% better chance of selling. It also said homes sell faster and for more money on average than other times of year. Most economists are saying that mortgage rates will increase this year. When those increase, it reduces demand for real estate. This is yet another reason why I don’t think this summer’s market will be as good as the one we are seeing right now. If you have any questions for us or are thinking about buying or selling in the near future, give us  call or send us an email. We would be glad to help out in any way possible.

We’ve got another great question from our viewers to answer today. This one is about property taxes. Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation We’re back to answer another one of your great questions, “How are real estate taxes calculated?” In Illinois, our real estate taxes are calculated based on the property’s assessed value, which is reassessed every two years by the county assessor’s office. When they have the value, they take a percentage off of that value toward taxes. On average, it’s about 2.13% of the home’s value that you’ll pay in property taxes. On average, property taxes are about 2.13% of the home’s value.The precise number varies from county to county, however. It also depends on a number of other factors, including your county’s budget for schools and law enforcement. If you have any questions or would like some more specific info on your property taxes, don’t hesitate to give us a call or send us an email. We would love to hear from you. Remember, if we answer one of your questions in a video, a $25 gift card is coming your way! We look forward to hearing from you soon.

What’s the best pricing strategy? We’ll go through your options today.   Buying a Chicago home? Get a full home searchSelling your Chicago home? Get a free Home Price Evaluation Today’s question comes to us from our friend, Tim. He asks, “Is it better to price your home high or more competitively?” Here’s my opinion. I personally like to price the home so that it sells within the first 30 days it’s on the market and we don’t have to go through any price reductions. According to nationwide statistics, a home that sells within its first 30 days on the market will get you optimal price without a reduction and you will sell for 99% of the asking price on average. “ Selling within the first 30 days is ideal. ” If you sell the home between 30 and 60 days on the market, that number dips to 96% of asking price. If you sell between 60 and 90 days on the market, it drops even further to a 92% average. After 90 days, 71% of sellers take their homes off the market.  Looking at those numbers, you can see that selling within the first 30 days of listing is ideal. So to answer your question, yes, I suggest pricing competitively right away so you don’t have to go through price reductions and won’t miss out on getting your price later on. If you have any other question about pricing your home in the Chicago market or you're looking to buy or sell a home, give me a call or send me an email. I look forward to hearing from you.