SELLING A HOME IN TODAY'S CHICAGO REAL ESTATE MARKET - NOT AN EASY AFFAIR!
Spotted a syndicated article in last Thursday's Chicago Tribune, written by Ellen James Martin of the Universal Press Syndicate. It had some relevance to me, as a Real Estate Team Leader here in Chicago and in the suburbs. In fact, it was the subject of a lengthy discussion among several of us in our Business Networking "Mentor" Group the other morning.
She relates the story of a 45-year-old sales professional who purchased a custom-built Executive Style home, and felt extremely confident, several months ago, that his home would sell quickly, for his price. Now, considerable time has passed, and his new house is almost ready for delivery.
Panic is setting in!
He seems to be blaming his ReMax Listing Agent for "not doing enough." In reality, the seller is avoiding the issue - HIS PRICE IS TOO HIGH FOR TODAY'S MARKET!
In many neighborhoods here in Chicago, and in most suburbs, there is a large inventory of available homes for sale. Our Team just ran the numbers for a client of ours in Skokie IL - theoretically, it would take nearly 18 months to sell all existing inventory - not only in this middle-upscale village, but in the slightly-more-upscale Chicago North Shore Communities of Glenview and Northbrook as well! This "Absorption Rate" has increased from 12 months in November, 2006, to just under 13 months in June of 2007. Historically, six months represents a balanced supply/demand situation. During the stronger real estate market here in 2004 and early 2005, the then-calculated Absorption Rate was about 4.5 months!
We calculate another predictive number - the "Odds of Selling" a given property, in a specific area, within a six month marketing window. These odds, in the same Chicago North Shore Suburbs of Skokie, Northbrook, and Glenview IL, indicate a 39% chance of completing a residential home sale in six months if the house were listed today. In other words, on average, there is over a six out of ten chance the home won't sell. This fact alone makes PRICING right not only important, but CRITICAL!
Here are four suggestions from ReMax Agent Kathy Zimmerman, who was interviewed in the article. Our Team heartily concurs with all of these -
Don't count on Open Houses to produce a qualified home buyer! Docras Helfant, the former president of the National Association of Realtors, reminds us that Public Open Houses rarely attract serious, qualified buyers. Most visitors are nosy neighbors, looking for decorating ideas, and to justify, in their own minds, that their own house could go for far more money than yours - if they ever decided to sell, that is! Here at Dean's Team, we use Broker's Open Houses - inviting Licensed Brokers and Realtors during the business week, to get their perspectives on how the house shows, and the correctness of its price level.
Don't place undue pressure on the Real Estate Professional you retained to sell your house! If you were to talk to successful Real Estate Practitioners today, most will tell you they feel they are under a magnifying glass - any lack of activity is their fault, in the minds of their clients. In a strong market, the agents were kings, gods - now the opposite is true, it appears! Everyone has friends, or family, or other real estate people, that often put their two-cents in. Problem in, most often, these spectators only know what they read in the newspapers or online - they don't live the market, all day long, like the professionals do. We often consider retiring clients who refuse to listen to our suggestions about pricing and marketing - we've done so, here at Dean's Team, a half-a-dozen times in 2007, unfortunately.
There is no such thing as a "scientific asking price"! Understand that comparable sales, pending, and active data is a mere INDICATION of projected sale price. The only way to truly determine the market value of a specific home is to place it on the market, apply effective, proven marketing techniques, gauge response, and adjust the price if necessary to generate a sale. Home sellers delaying price adjustment decisions, in today's market here in Chicago, often find themselves chasing a roller coaster down the next hill.
Clean, clean, clean! The old salt predicting how much a home will eventually sell for - "location, location, location" has changed a bit. Even a house in a less-than desirable location will sell, if the PRICE is right, and it is STAGED correctly. We're talking "toothbrush clean," folks. Furniture organized properly, and all clutter removed. If not, with inventory levels very high, the seller will walk to the next house that looks better in their eyes.
Hope this helps, folks! Keep the faith, but, please, listen to your Real Estate Professionals - they don't earn a penny, until they help you reach your home-selling goal!
DEAN MOSS & DEAN'S TEAM CHICAGO
