Real Estate has Changed across the United States
For years we have had a Seller's market fueled by a shortage of inventory, a great economy and record low interest rates.
Today, our market has changed from a 5 year Sellers' Market to a Buyers' Market. Our inventory has increased dramatically, our interest rates are higher and buyer's perceptions have changed in the past year for what their expectations on the market should be. Buyers' previously were not watching cable tv for redoing a house, swap homes, or HGTV to get ideas. Buyers' previously could buy a home with little or no down payment, but now because of the high foreclosure rates, lenders just are not offering these programs. (Thank God)
Our underwriting standards have gotten back to the late 1980's where 3% FHA loans, 5% down-19% down payments required PMI (private mortgage insurance), and people are no longer going for the dangerous bridge loans. Good news about PMI is that as of January 2007, PMI has become tax deductible! PMI, based on the current inflation, could be eliminated from your payment. Please call me to send you an updated record of sales in your area.
With the lack of Buyers who qualify for the more stringent requirements, the Buyer definitely has the power to shop, take their time and gather all the information they need. Be forewarned though, the Buyer also has competition among other buyers. If a seller prices his home slightly below market, it is not rare for dual offers to be presented.
What is remarkable with the entire process in Chicago land is that the ratio of selling price to list price has not changed much this year. In other words, the sellers are listening to the market and reducing their price to fair overall. 94% list to sell ratio is just about normal.
Let me know if I can make sense of the market for you! I have years of training and experiance to offer!