During these uncertain times, many buyers and sellers are feeling unsure about how to proceed. Some have ceased looking for homes or taken their homes off the market, while others feel unsure of what to do. All completely valid choices and feelings in the light of current events. However, if you’re one of those people who feels unsure or truly need to buy or sell as soon as possible, we want you to know there is still an active real estate market ready for you.

Local Insights

At a local level, things have slowed down and while it is not the typical Spring market we’re used to, the market is still active! For example, in the first two days of April, 15 new homes came on the market and 11 sold in Naperville. And, at jgR, we’ve still had 60 homes go under contract since the shelter-in-place order was given on March 21st.

We are experiencing a strong desire of many of our clients to press on. For many of them, this is as basic as the need for shelter. People have expiring leases. They are being transferred. In many cases, they are in between homes, and actively looking to find something more permanent.

This is Different from 2008

As we face the undeniable economic impact of the pandemic, there are many rumors and concerns about the possibility of another housing crash. While we are facing what is predicted to be a short recession, the fundamentals in housing are significantly different than they were in 2008. Housing was the key factor that caused the last recession as a bad combination of sub-prime lending, low amounts of equity and falling home values caused an unfortunate amount of short sales and foreclosures that required several years of recovery. Luckily, that is not where we are today. After a decade of steady appreciation and tighter lending guidelines, homeowners have much more equity in their homes and cashing out that equity significantly less and the mortgage default rate is historically low. See graphs below from www.keepingcurrentmatters.com.

People are watching home affordability on a national level really closely. The good news is that the local data for Chicago show that we are one of the more favorable markets in the country for home affordability. In the last decade, Chicago-area home prices have appreciated at much more modest rates than other parts of the country, and they have appreciated at a similar pace to income, inflation and the cost of living in our local market.

It is also important to note that a recession in and of itself does not equal a housing crisis. In the past 5 U.S. recessions, home values actually rose during 3 of them and only took a slight dip of less than 2% in another.

So, Should You Still Try to Buy or Sell Right Now?

While that is up to you based on your individual needs and concerns, it is still completely possible. Each sector of the industry has worked to make process modifications to help ensure the health and safety of everyone involved.

Some of these modifications include limiting the number of people at closings or showings, even doing mobile or curbside closings. Many sellers and their agents are allowing virtual tours of the property or creating 3D interactive walkthroughs of the home which are almost like being there in person. Meanwhile, contracts can be signed virtually and in-person meetings can be switched to FaceTime or Zoom calls very easily.

We have been pleasantly surprised by how well the market has adapted to these new rules, and in many cases, we expect that these practices will be adopted long after we have this pandemic under control.

It is very much possible to find your next home while in the comfort of your own home. At the very least, these virtual resources should be a great aid in helping you narrow down which homes you’d like to see in person.

It is also important to note that mortgage rates are still historically low. So if you have the funds and your employment is stable despite the current downturn, it could make sense to move forward. If you buy now, you may be able to afford a larger or more updated home than you would if interest rates rise.

Consult Your Agent

Your real estate agent will be there to guide you every step of the way. They can provide you with real-time market insights both locally and nationwide to help you make the best decisions for you. Agents also have access to a private network of properties that you won’t find on Zillow. They may be able to find you something that is not officially on the market but still accepting showings and offers.

From a seller’s perspective, our agents can provide you with a proprietary Buyer Market Analysis which can give you an idea of the level of online search activity in your area for homes like yours. If you would like a BMA on your home, click here! They can also put together a Comparative Market Analysis for you to help you see market activity in your area and where your home falls in the mix.

We are here for you no matter what. If you have any questions, please do not hesitate to contact us and we would be happy to connect you with an agent who can help you as you decide the best way to move forward.

Be well!