Market profile: Sales and prices fluctuate between neighborhoods

Real estate is so incredibly local that you cannot equally compare markets between two neighboring towns and, in some cases, different areas of the same town, said Christine Chase, president of the Mainstreet Organization of Realtors and vice president of relocation for Ryan Hill Realty in Naperville.

“There are 135 different towns in the Chicago area and at Mainstreet we track numbers within DuPage County and parts of Will, Kane and Cook counties on a monthly basis,” Chase said. “The difference in those stats from town to town is amazing. In some towns, prices are down 85 percent and in others, prices are up 60 percent.

“So when people see national real estate data, it has such a confusing affect on consumers. It is critical that prospective buyers and sellers talk to someone who is knowledgeable about their local market.”

What are your general impressions of the market you are seeing now?#147;Spring has always been a busy time for the real estate market. It would start after the Super Bowl. But for the last couple of years there has been no spring market to speak of.#148;However, this year real estate professionals are seeing a more typical spring uptick with more listings and more buyers, she said.#147;Sellers have finally become acclimated to the new pricing. It was a bitter pill to swallow. Buyers, on the other hand, caught on quickly.#148;Chase and her colleagues see more realistic pricing and, as a result, are hearing anecdotes about multiple bids on homes again.Can you give an example of how neighboring communities#146; markets can widely differ?Chase said the number of residential units sold in Naperville this year, through the end of March, was up 31 percent over the same period last year, with homes spending 10 fewer days on the market, on average. But the average price was down 2.5 percent and the median price was down 11 percent over that same period. In fact, the average sale price was less than $200,000.In neighboring Bolingbrook, on the other hand, closings were down 54 percent, year-over-year, and the average sales price was down 32 percent. Plainfield saw sales drop 37 percent over the same period in 2010, but the average sales price was 4 percent higher.So there is no consistency between the three neighboring markets.#147;That is why it is so important to watch this volatile market so closely. I now track it on a weekly basis with my sellers and a 30- to 45-day cycle for price adjustments is now typical.#148;Do you see any differences between the single family and multifamily (townhouses, duplexes and condominiums) markets?#147;Single-family homes are definitely moving better than condos and townhouses are and there is a huge inventory of those types of units. But the investors are getting back into the market and that is a good sign. They recognize that there is some very attractive pricing out there, so if a multifamily complex allows rentals, we are seeing some good activity from investors.#148;Is the price of gasoline having an effect on buying decisions?#147;Gas has been at the top of buyers#146; consciousness the past 18 months and that is even more true recently. Travel time to their job is also very important. No one wants a long commute.#148;Chase gets more questions now about various properties#146; proximity to Metra and public transportation than she has ever gotten during her 20 years in real estate.Are first-time buyers stepping into the market and taking advantage of the lowered prices and low interest rates?#147;The nervousness factor seems to have decreased recently. We have never seen a decrease in the number of people who aspire to own a home. There was just a reluctance for a long time to buy now. They kept wondering if we were at the bottom of the market yet.#148;Chase is not at all worried that homeownership will significantly decrease in coming years. Recent surveys show 80 percent of people between the ages of 20 and 35 still believe purchasing a home is a better decision than renting one in terms of finances, safety and overall environment.What still needs to happen for the residential real estate market here to rebound once and for all?#147;Employment in Illinois needs to increase. A stable job is the leading factor for making people confident to go ahead and purchase a home. They want to feel comfortable that they will continue to be able to pay their mortgage.#147;We need better economic development in Illinois and all the talk about taxes and other things giving Illinois a black eye are not helping.#148;Are you still seeing so many short sales and foreclosures?#147;Half or more of the homes currently on the market are bank-owned foreclosures or short sales, and in some places that figure is even higher. In fact, if you can say that your home is not a short sale, that fact can be used as a marketing tool on the listing because any Realtor looking at that listing will know they won#146;t have to deal with waiting up to 90 days for an answer on a short sale offer, for instance.#148;Chase said banks have streamlined the short-sales process a bit recently, #147;but that is not saying much. It is still dreadful.#147;Buyers see a short sale as a good deal, but they often don#146;t realize that their mortgage approval lock can often run out before they ever get an answer on their offer, and during that lengthy process their earnest money is tied up and they cannot make decisions about whether to continue renting, for instance.#147;In addition, as prices were falling, they found out the deal that looked so sweet 90 days ago may not look so sweet by the time they get a response.#148;What do you suggest to homeowners who find themselves in trouble on their mortgage?#147;First, don#146;t ignore the mailings you are getting from your lender. Call their loss mitigation department immediately. Next, stay in your home. If you move out, that can be seen as abandoning your property and can make you ineligible for assistance.#148;Then get a realty agent to tell you what the current market value of your home is. If that value is less than what you owe, you should seek help from one of the federal government#146;s loan modification services. Visit www.makinghomeaffordable.gov or www.HUD.gov for more information. You can also seek legal advice from www.IllinoisLegalAid.org.