Real Estate Market Trends: What You Need to Know

SLT · Real Estate Market Trends: What You Need to Know The real estate market is constantly evolving, and if you’ve been keeping an eye on interest rates, you’ve likely noticed the big shift recently. After months of rates hovering in the 7% range, we’re now seeing the market solidly in the 6% range for a 30-year fixed mortgage. So, what does this mean for both buyers and sellers? Let’s dive into the current trends and how you can take advantage of the opportunities! Interest Rates Have Stabilized – What Now? Just a few weeks ago, we were flirting with interest rates in the 7% and 8% ranges. Now, we're seeing a trend towards stabilization, with rates sitting in the low 6% range. This has had a significant impact on the market, making home loans more attractive and boosting buyer activity. Buyers are starting to realize that this is an ideal time to get back into the market. Homes are more affordable than they were just a month ago, and rates are no longer the monster they appeared to be. The shift has happened, and with stability in sight, it’s time to seize the moment. Buyers Have More Leverage – Inspection & Negotiation Power One key takeaway from recent market activity is that buyers are now in a stronger position. Gone are the days when buyers waived inspections or skipped negotiating credits. We’re seeing a more balanced market where buyers are asking for things like closing cost credits and negotiating repairs. In fact, buyers who had shied away from FHA or VA loans are now returning, as sellers become more receptive to various loan types. This normalization is creating a healthier market where both buyers and sellers have options, reducing the pressure of rushed decisions. Pricing Strategies Are Changing – Here’s What to Do Sellers at higher price points are making price reductions, which means buyers have the opportunity to secure homes for less than list price. But here’s a tip—don’t leave money on the table! When negotiating, consider asking for a closing cost credit rather than reducing the offer price. For example, if you’re looking at a $736,000 home and planning to offer $725,000, consider offering the full price but ask for $11,000 in closing cost credits. This way, you can cover your costs like attorney fees, and insurance, or even buy down your interest rate. Inventory is Increasing – More Choices for Buyers Another positive trend is the increase in available homes. With more inventory coming to the market, buyers can take their time to shop around, and sellers have a better chance of finding their next home after they sell. The frantic "fire drill" of buying a home has lessened, giving both parties more breathing room. This boost in inventory is especially great for those who sold their homes at peak prices but held off on buying due to uncertainty. Now, with more options, sellers are more likely to find a place to move without the stress of paying to move twice. Addressing Buyer Anxiety – The Truth About Commission Lawsuits One topic causing anxiety recently is the impact of the real estate commission lawsuits. While there were concerns about how this would affect the market, the changes are relatively minor. Now, buyer agents must have a signed buyer agency agreement, and commissions are no longer listed in MLS for public view. However, commissions are still very much a part of the transaction. Buyers will continue to have representation, and the paperwork involved hasn’t significantly affected the process. Real Estate Never Takes a Break – Even During Holidays A common misconception is that real estate grinds to a halt around Thanksgiving or the Super Bowl. In reality, people are still actively buying homes during the holidays. We’ve seen buyers trudging through snowstorms to view homes, and pre-approvals are still being written during these periods. If you’re serious about buying or selling, don’t wait for the "perfect" time—because that perfect time is whenever you're ready to make your move! Highlight: Meet Sarah Leonard, Your Trusted Real Estate Expert As the voice behind this insightful discussion, Sarah Leonard brings years of experience and a deep understanding of local trends to the table. If you're looking for a trusted guide through this evolving market, Sarah is here to help you navigate your buying or selling journey effectively. Don’t miss out on the opportunity to make informed decisions with her expert guidance! Contact Sarah LeonardPhone: 224-239-3966Email: sarah@sarahleonardsells.com

Real Estate Trends: Sarah Leonard's Insight

SLT · Real Estate Trends: Sarah Leonard's Insight Real estate goes beyond just transactions—it's about understanding people, timing, and finding the perfect fit. Whether you’re an experienced homeowner or venturing into your first purchase, navigating today’s market can be daunting. Recently, on Home Sweet Home Chicago, I had the chance to dive into the latest trends, surprising insights, and what lies ahead for buyers and sellers. Is it a Good Time to Buy? A listener called in, worried about whether his son should wait to buy a home. His advice had been to save 20% down and wait for better market conditions. Sarah had a different take, stressing that there’s no one-size-fits-all approach to buying a home. She explained that buyers could secure a home with as little as 3% down through FHA loans or even explore other options like USDA loans. In today’s market, the pendulum has swung toward buyers, meaning that holding off might not be the best advice for everyone. Sarah's message? If you're ready to buy, don’t wait for perfection—act while opportunities are still within reach. Why Waiting Might Not Be the Best Idea Waiting for "the perfect time" can often lead to missed opportunities. Over the past few years, buyers who chose to wait may have seen home prices rise and interest rates fluctuate. While hindsight is 20/20, Sarah emphasized that securing a home now could be the smarter move. As she mentioned, you can always refinance your mortgage rate when it improves, but you can’t always lock in the same home price. The Current State of Pending Home Sales Pending home sales have been trending downward for 23 months, and Sarah pulled up some eye-opening data. In Schaumburg, Illinois, a large Chicago suburb, there were 76 pending homes at the time of our discussion, compared to 137 the previous year. That’s a significant drop. But it’s not due to a lack of demand—it’s a lack of inventory. Simply put, buyers want homes, but there aren’t enough available. Why Are Sellers Holding Off? Many potential sellers are holding back because they secured low mortgage rates during the past few years. With rates now hovering around 7.25%, homeowners with 3% rates are hesitant to move, even though they have significant equity in their homes. But Sarah predicts that if rates stabilize in the 5% to 6% range, it could push sellers to make a move. For every 1% drop-in interest rates, homeowners can save significant amounts on their monthly mortgage payments, which could be the push they need to list their homes. The Role of Adjustable-Rate Mortgages (ARMs) In the past, adjustable-rate mortgages (ARMs) were a popular option for buyers, but they've fallen out of favor in recent years. However, Sarah believes ARMs could make a comeback as rates become more favorable. When homeowners realize they can lock in a rate at around 5.5% on a 30-year fixed mortgage or even lower with an ARM, we could see a surge of new listings hit the market. What Rate Will Get You Off the Couch? One of the big questions of the day was: What will it take to get homeowners to sell? With 70% of homeowners in the area locked into rates under 5%, what kind of rate would entice them to sell and buy another home? Many are waiting for that "magic number," but as Sarah pointed out, it might only take a drop to the high 5% range for the floodgates to open. For every $100,000 borrowed at 7.25%, homeowners are paying roughly $682 per month. But if rates drop to 6.25%, that payment goes down to $615. Over a year, that adds up to significant savings. Looking Ahead: A Market on the Verge of Change As we look to the spring of 2024, there’s hope that interest rates could fall to the 5% to 6% range, creating a more favorable environment for both buyers and sellers. The key takeaway? The market is always shifting, and while it’s important to be financially prepared, timing your move can be just as important. In real estate, staying informed and knowing when to act is key. Whether you’re buying or selling, Sarah Leonard's expertise can guide you in making the right choices for your situation. Are you ready to make your move? Let’s chat! Contact Sarah LeonardPhone: 224-239-3966Email: sarah@sarahleonardsells.com

Home Ownership Insights: Sarah Leonard

Sarah Leonard, a real estate expert from Legacy Properties, offers valuable insights into the complexities of home ownership, especially when intertwined with relationships. In today's market, where both economic factors and social dynamics are influencing buyers and sellers, understanding the nuances of property ownership has never been more important. Key Considerations for Buyers and Sellers 1. The Risks of Co-Owning Property with Unmarried PartnersOne of the most critical aspects of home buying involves understanding the risks of purchasing property with a partner without being married. Sarah Leonard highlights that nearly 50% of marriages end in divorce, a statistic that underscores the potential complications of co-owning property without the legal protections marriage provides. In one example, a couple who had purchased a home together faced difficulties when they broke up. Even though the home was in the girlfriend’s name, the boyfriend was still responsible for the mortgage, creating a complex and contentious situation. To avoid such complications, Sarah advises couples to either marry before buying property together or put clear legal agreements in place. 2. Market Dynamics and Buyer MotivationThe housing market has experienced significant shifts, particularly with fluctuations in interest rates. Rising rates initially caused many potential buyers to hold back, but as buyers adapted to the new normal, there has been a renewed interest in open houses and market engagement. According to Sarah, external factors, like major events such as the Super Bowl, can even spark an uptick in buyer activity. These cyclical market trends are important for buyers and sellers to be aware of, helping them to time their decisions more effectively. 3. Emotional Factors in Estate ManagementManaging inherited properties often brings emotional challenges, especially when families gather during holidays and tensions around ownership or selling can surface. Many people struggle with the sentimental value of inherited belongings versus the practical need to sell. Sarah Leonard stresses the importance of seeking professional assistance in estate planning and real estate matters to ease these emotional burdens and ensure that families navigate these situations smoothly. 4. The Role of Real Estate ProfessionalsA recurring theme in real estate is the vital role that professionals play in guiding clients through the buying, selling, and managing of properties. Sarah emphasizes the importance of relying on knowledgeable agents who can help clients make informed decisions and avoid disputes with family members or partners. Conclusion: Making Informed Real Estate Decisions Sarah Leonard's insights reveal that home ownership, particularly when relationships are involved, comes with its own set of challenges. Whether buying as a couple, with family, or as an individual, understanding the emotional, social, and practical implications is key to making smart real estate choices. For those considering entering the real estate market, consulting experienced professionals like Sarah Leonard can provide clarity and peace of mind. Being well-informed can make all the difference in achieving long-term success in property investments. Call to Action If you're thinking about buying a home or navigating complex real estate situations, reaching out to a trusted real estate professional is essential. They can provide expert guidance to help you manage these challenges and make decisions that are in your best interest. For more information, contact Sarah Leonard at Legacy Properties by phone at 224-239-3966, or visit her website at sarahleonardsales.com.

Foreclosure & Short Sales Tips by Sarah Leonard

Understanding the Situation: Short Sales vs. Foreclosure Before diving deeper, it's essential to understand the distinction between a short sale and a foreclosure. As Sarah Leonard explains, a short sale occurs when a homeowner sells their property for less than the remaining balance on their mortgage. A foreclosure, on the other hand, is when the bank takes possession of a property due to the homeowner’s inability to make mortgage payments. Many homeowners today find themselves in financial distress, despite having significant equity in their homes due to the rapid appreciation of property values since the COVID-19 pandemic. For those in such a situation, Sarah Leonard stresses the importance of taking action sooner rather than later. Don’t Let Your Home Equity Slip Away "Would you agree or disagree," says Sarah Leonard, "that to let late mortgage payments, late fees, and credit-crushing debt pile up without taking any action is a debilitating decision?" Leonard points out that doing nothing can severely damage your credit score and diminish your home equity, which could otherwise be a financial lifeline. For instance, if you bought your home for $250,000 in 2008 and it's worth $400,000 today, but you find yourself unable to make payments due to a job loss, sickness, or divorce, the financial burden can quickly escalate. Sarah Leonard explains that late fees, unpaid taxes, insurance delinquencies, and other expenses can accumulate rapidly, eroding your hard-earned equity. "The key," she advises, "is not to let things get so far out of hand that you lose most of your equity by waiting too long to address the problem." The Real-Life Scenarios Sarah Leonard shares stories from listeners and clients who face similar dilemmas. One listener, who went into forbearance during COVID-19, has not made a mortgage payment in six months. Rather than allowing the situation to spiral into foreclosure, she worked proactively with her servicer to enter forbearance again. This move prevented her credit score from taking a hit and gave her a chance to catch up financially. But, as Sarah Leonard highlights, this situation is still precarious. If the listener cannot get an extension or fails to make the necessary payments, she must decide whether to let the mortgage fall further into delinquency or sell the property and retain the equity that remains. The Critical First Step: Communication Sarah Leonard emphasizes the importance of communication: "The first thing you need to do is call your servicer – the company you write your mortgage payments to – and tell them you're having hardships. Have documentation ready to show your hardship." Whether it’s due to job loss, sickness, or another life event, documenting the situation is crucial for negotiating with lenders and making informed decisions. Why a Short Sale Might Be the Best Option For some, selling the home and starting over might be the best way out. Sarah Leonard explains, "Sometimes, the weight of carrying around a heavy financial burden is too much, and selling can be the answer. If you have equity in the property, don't let the bank take those fees and strip that away from you." She also points out that if you bought a home in 2021, when prices were high and mortgage rates were low, but are now facing job loss or another hardship, a short sale could be a viable option. "If the home is worth less than what you owe, and you don't have the money to cover the shortfall, a short sale might allow you to walk away from the property without further debt," Leonard advises. What Defines a Hardship? According to Sarah Leonard, qualifying for a short sale requires proving a genuine financial hardship. Common hardships include: Divorce Death of a spouse or partner Job loss or significant income reduction Major medical expenses If you're uncertain whether your situation qualifies as a hardship, Sarah Leonard encourages reaching out for guidance: "Call, and I'll be happy to talk you through what might qualify." Rebuilding After a Short Sale While a short sale can be an emotional and financial setback, Sarah Leonard reminds listeners that it’s not a permanent mark on your financial record. "If you do a short sale, it’s typically three years before you can buy another home," she notes. "It's like having a temporary setback but being able to start fresh after some time." She continues with an analogy: "It's like having terrible acne in high school. You graduate, see a dermatologist, and after three years, your skin is clear again. Time heals all wounds." Moving Forward: Proactive Steps to Take Now To avoid foreclosure and maximize your options, Sarah Leonard advises: Call your mortgage servicer: Discuss your situation, and explore your options. Consider a short sale: If keeping the property isn’t feasible, selling it before foreclosure might be the better option. Stay informed: Learn about the alternatives and what makes the most sense for your unique situation. If you’re feeling overwhelmed or unsure of what to do next, Sarah Leonard reassures, "There's no reason to be uncomfortable or embarrassed talking about it. It happens to good people all the time. If you're in a situation where you just don't know what to do, call us. We're happy to help." If you need further assistance or want to discuss your options, Sarah Leonard is here to help. Call her at 224-239-3966 or visit her website at sarahleonardsells.com.