Realtors See Signs Of Life In Chicago Market
CHICAGO (CBS) -- Realtors meeting downtown say they're seeing signs of life in the Chicago-area real estate market after four lean years, although it's not the ideal time for everyone.
"I just had the best year of my entire career," said Matt Silver of Urban Real Estate says homeowners who have been on the sidelines for five years are moving -- in droves. He said the bulk of the activity has been in the past two months.
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"Supply was really outpacing demand for a while, and that's still the case, but supply has evened out a bit so pricing is stabilized," said Matt Farrell of Urban Real Estate, who says the mid-market buyer has begun to reappear.
Despite those reports, there is a potential problem for some. Although Silver said he has seen no evidence of hesitation because of fears of a double-dip recession, other agents and brokers attending a meeting of the Chicago Association of Realtors this week said they are hearing those fears.
"People are saying the markets are so bad, real estate is so bad, and everyone is concerned that the real estate itself is not going to turn around until the banks can start moving these loans off their books," said realtor Millie Rosenbloom. "Until that happens, you're going to see the foreclosures, and foreclosures hurt the surrounding area."
While Rosenbloom said some are lured into the market by historically low interest rates, others cannot get loans because they don't have the money banked to meet 20 percent or higher down payments.
That's good news to rental specialists, such as Greg Pekarsky, who said business this summer in luxury rentals was two to three times the recent norm. He said that signals a potential shift to a buyer's market by next summer as rents creep up because of demand.
He and others noted that eight new luxury apartment complexes have opened in the downtown area and are doing brisk business.
Pekarsky said some who are renting are merely waiting to find what they want. But he said bank loan requirements are such that even people with good incomes cannot qualify for mortgages.
Silver said that many potential buyers have come to the realization that, although the price they get for their home may be 10 to 30 percent below what it was five years ago, they are also getting good deals when they buy.
"They're not going to make their gold mine right now, but on the buy side they'll do just great," he said.
Not every buyer or seller is created equal, though. Farrell said that those who have owned their homes for 15 years or more are prime candidates to sell, while those who bought at the top of the market in 2006 and 2007 should hold onto their properties. And Rosenbloom said that those who buy now should not attempt to flip their homes, but should be ready to live in them for the next five years.
