Your Ultimate Guide to Real Estate on Chicago's North Shore

Archive for the 'Selling a home' Category

What To Ask Before Hiring A Listing Agent

“The best predictor of future performance is past performance.”

In the corporate world, if you want to know how well someone is likely to perform in a new job or assignment, the best way to tell is to look at how they performed in their last job or assignment. And it’s pretty much the same when it comes to hiring a listing agent to sell your home.

If you are like most people, you want to sell your home as quickly as possible, for as much money as possible. So the performance measures you should ask your listing agent about are:

  • Average market time for her listings
  • Sales prices as a % of list price
  • Sales price as a % of original list price (i.e., before price reductions)

If the agent has performed well on these measures for past sales, chances are she’ll perform similarly for you.

However, you should keep in mind that context is key! Numbers are meaningless without context.

In other words, how did this agent’s performance compare to the rest of the agents in the market? And what market is she comparing herself to? Is it the specific community where your house is located or is it the greater Chicagoland Metro area? And is it for the most recent 12 month period or all the houses she’s ever sold?

Let’s say an agent tells you that sells her listings in 100 days on average.  That sounds pretty good, doesn’t it? It wasn’t that long ago that houses were languishing unsold for a year or more. In that environment a 100 day market time would be quite an achievement. But not these days. We have moved from a buyer’s market to a seller’s market (at least in some price ranges), and listings are selling more quickly than before. Today the average market time on the North Shore is 107 days, so you probably want to look for an agent who can get the job done faster than that.

Similarly, an agent may have an average sale price to list price of 92%, a big improvement over recent years where homes sold for 90% of list price (after several price reductions). But today North Shore homes are selling for 94% of list price, on average. You want to hire an agent who can get you at least 94% of list price, if not more.

Here’s the performance data for the Come Home North Shore real estate team:

performance stats for Come Home North Shore real estate team

Our team’s average days on market is 30. Our sales price is 96% of list price. That means we sell our listings over three times faster than the market average in the communities we serve and get our clients 2 percentage points closer to their list price.

Wow. Based on this data you may want to interview Come Home North Shore to list your home!

If you do (or even if you don’t) you will want to drill down even further and ask the agents you are interviewing  for their track record in your home’s specific price range and location, since market dynamics can differ dramatically.

Bottom line, make sure you are getting data and comparisons relevant to your own situation.

We are North Shore real estate specialists and one of the top Realtor teams in the area. If you would like to consult with the Come Home North Shore team about getting your home sold, please call 847-881-6657 or send us a note here.

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To FSBO Or Not To FSBO?

To sell your North Shore home by owner or not. That is the question many would-be home sellers are asking themselves these days.

That’s because they’ve noticed that inventories are low and good houses are selling quickly. So why not try and save on the real estate commission by going the For Sale By Owner route. After all, saving the whole commission on a $600,000 house could be as much as $30,000. No wonder it’s so tempting.

But before you go down that road, consider the following:

1. The data shows that the typical price a FSBO sells for is, on average, $40,000 less than a home sold by an agent.

FBSO price

Although the “typical” price is actually the average price in the survey, studies have shown that people are more likely to FSBO in markets with lower-priced homes. However, the fact remains that agents get more money than FSBOs for the same house.

2. Another thing to consider is that 89% of buyers use an agent to purchase a home. Which means that as a FSBO 9 out of 10 potential buyers will never see your house. Even if you agree to cooperate with (i.e., pay a commission to) the buyer’s broker, you’ve now cut your commission savings in half.

Nowadays over 90% of buyers use the internet to search for homes. Even if you put an ad on Craig’s List or even on the MLS, without an agent representing you your listing will never get syndicated on the hundreds of sites that buyers use in their home search. And forget advertsing in the newspaper. Only 28% buyers use newspapers in their home search. Most of the people looking at real estate ads in newspapers are other home sellers and real estate agents.

3. Finally, you should know that FSBOs have declined from 19% of home sales in 1991 to 9% today. There’s a good reason for that. The home sale process is much more complex these days and fraught with pitfalls. Many deals fail to close for a whole host of reasons: Buyers can’t qualify for a mortgage. Appraisals come back low. Inspections have become more contentious. Disclosure problems lead to litigation. And on and on.

Decline of FSBOsEven if you’re pretty sure you want to try selling on your own, you should probably interview a couple of agents first, so you are fully aware of all of the services, expertise and marketing exposure you will be foregoing as a FSBO.

graphs courtesy of KCM

We are North Shore real estate specialists and one of the top teams in the area. If you would like to schedule a buyer or seller consultation with the Come Home North Shore team, please call 847-881-6657 or send us a note here.

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Don’t Fall For Illinois Deed Provider Scam

IllinoisDeedProviderThis week area residents got an official-looking letter (like the one on the right) from an outfit called Illinois Deed Provider.

The letter stated that the U.S. Government website recommends that property owners should have an official copy of their deed. Illinois Deed Provider (which has no affiliation with the State of Illinois) offers to provide a copy of your deed for $79.50.

Now there is actually nothing illegal about this service, assuming they actually deliver the deed. (I’m certainly not going to pay them to find out).

However, did you know that you can EASILY get a copy of your deed in less than five minutes by going to the website of the Recorder of Deeds for your county? For example, if you go to the Cook County Recorder of Deeds site, you will see that you can downlaod a copy of your deed for only $2.50 by simply entering your property’s 14-digit pin number (which can be found on your tax bill). If you’d like a paper copy mailed to you it costs $10.00.

Most people don’t realize they can do this, which I guess is why outfits like Illinois Deed Provider can dupe so many people into paying $79.50. I just don’t want it to be you!

Thanks to Kenan Stevens of Burnet Title for this valuable tip.

We are North Shore real estate specialists and one of the top teams in the area. If you would like to schedule a buyer or seller consultation with the Come Home North Shore team, please call 847-881-6657 or send us a note here.

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How NOT to Find a Buyer For Your North Shore Home

An agent in my office told me a story the other day about a listing presentation she went on that highlighted one of the misconceptions North Shore homeowners have about real estate advertising.

She was talking to the homeowner about her marketing and about the benefits of listing with Coldwell Banker. The homeowner pulled out the local newspaper and opened it up to several consecutive pages of ads from a competitive brokerage and said, “Look at them. They do more advertising than your company. Why shouldn’t I list with them?”

My agent friend proceeded to show him the NAR (National Association of Realtors) research about where home buyers search for properties: 90% of them search on the Internet, while less than 30% look at print ads.

Use of Internet to search for homes

 

Then she showed him the graph from Compete.com, an independent source that tracks website visits across the industry. The graph shows that ColdwellBankeronline.com is far and away the most visited site by home buyers in our area (blue line in the graph). That other company’s numbers were way below, with only 6% of the traffic of Coldwell Banker’s local site.

Compete.com_May

She asked him whether he would rather his home be where buyers are searching or where other home sellers are looking.

He got her point.  And she got the listing.

You see, there are two main reasons why real estate agents advertise their listings in local newspapers and magazines, and neither of them have anything to do with selling your house.

One reason is to appeal to their client’s ego. I mean, who doesn’t want to see a picture of their home in print? It’s almost as gratifying as seeing your child’s picture in the paper. And, besides, a print ad is tangible evience your agent is doing something to market your house.

The other reason is self-promotion for the agent. She advertises her listings in the local paper. Other homeowners see the ads and think, she must be successful. I should list my house with her. There’s nothing wrong with self-promotion. Realtors have to eat too.  But that kind of advertising is doing nothing to sell your house.

Because the people who are NOT seeing those ads are the people most likley to buy your house.

So, if you want to sell your home, make sure you hire the agent that markets it to home buyers, not to other home sellers.

We are North Shore real estate specialists and one of the top teams in the area. If you would like to schedule a buyer or seller consultation with the Come Home North Shore team, please call 847-881-6657 or send us a note here.

 

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Marketing vs. Pricing: What’s More Important When Selling Your North Shore Home?

home-aloneOne of the first questions homeowners will ask when we sit down to talk about listing their house is, how are you going to market my home?

Now, being an ex-marketing executive, that’s music to my ears. I love marketing, and Paula and I are always looking for the best ways to maximize exposure for our clients’ homes and make them stand out from the competition. Marketing is critical.  The more exposure a property has, the the better its chance of getting top dollar.

BUT…all the marketing in the world won’t work if the house is not correctly priced.

The best example I can think of is the “Home Alone” house, the house that starred in  the 1990 hit movie.

The house, a gorgeous Georgian located on Lincoln Avenue in Winnetka, came on the market in May 2011, at a list price of $2,400,000. The owners knew they were selling in a bad market, but said that the house’s celebrity status would get them exposure. And boy did it!

When the house hit the MLS it was THE story on every TV and radio station and every newspaper in the greater Chicagoland area. Real estate bloggers and Hollywood bloggers wrote about it. The house got more exposure than any normal home could ever hope to get.

But it didn’t sell.

By August the price had been reduced to $1,950,000 and in November it was taken off the market.

It came back on the market in March of 2012 and sold for $1,585,000, 33% below the original list price.

A word to the wise: get the price right first and then worry about the marketing.

Now that we are (finally) starting to see prices appreciate again, are you wondering what your North Shore home is worth? You can get a quick and easy over-the-net home valuation by just giving us some basic information about your house. Just go here to submit your info and we’ll send you your home valuation within 48 hours.

 

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Now You See It… Now You Don’t!

1025 Green Bay Rd, Glencoe…

image

There is something magical about the way the
Come Home North Shore Team gets the job done!

With two offers in three days this charming
stone home is under contract. Results like this are no illusion.
With magnificent expertise in marketing, the Come Home North Shore Team will capture the attention of the buying audience. Another trick that is not new to this team is the importance of power pricing.

Give us a call & find out what tricks we have in store for you…

Now that we are (finally) starting to see prices appreciate again, are you wondering what your North Shore home is worth? You can get a quick and easy over-the-net home valuation by just giving us some basic information about your house. Just go here to submit your info and we’ll send you your home valuation within 48 hours.

 

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The Truth About Pocket Listings

pocket listingsA couple of weeks ago a local brokerage here on the North Shore ran an ad in the paper with the following headline:

“Don’t Let Your Agent Hide Your House in His Pocket”

What they were referring to is “pocket listings”: the practice of brokerages selling listings without putting them into the Multiple Listing Service.

This practice has been around forever, but has traditionally been used mainly for ultra high-end or celebrity homes, where privacy is a key concern. But recently there has been a dramatic increase in the use of pocket listings for properties in all price ranges.

Why? Because the market is so hot right now that that there are many more buyers than there are homes for them to buy, resulting in multiple offers and bidding wars. Since it is so easy to sell a house in this environment, this no-muss, no-fuss approach to getting their home sold is appealing to sellers. They don’t have to have hordes of people traipsing through their home, they can forgo staging and constant cleaning and haggling with potential buyers.

And apparently some brokerages and agents are encouraging their sellers to do this. Read the rest of this entry »

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Closing Cost Credits – What Can I Ask the Seller to Pay?

closing costsEver since the housing market meltdown, it has become fairly typical for home buyers to ask sellers for closing cost credits. This is just a way of getting a “discount” from the seller and reduces the amount of cash the buyer needs to bring to the closing table.

Today at our weekly office meeting, Betsy Hanrahan from PHH Home Loans helped clarify how much of a buyer’s closing costs a seller can pay. The amount that is allowed depends on the type of financing the buyer is getting. However, in every case, the total of the credit cannot exceed the total amount of the buyer’s actual closing costs:

Conventional financing with less than 10% down payment

  • The maximum amount of closing costs a seller can pay is 3% of the purchase price.

Conventional financing with 10% or greater down payment

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Home Buyers: Here’s Why You Can’t Find a House to Buy on the North Shore

CB sold signJanuary home sales on the North Shore were down 7% from a year ago after a year where home sales rose 17%. What’s going on? Is the recovery stalling again?

Probably not. One month of data does not a trend make. Lower sales activity could have to do with the fact that we had a colder January this year than last, keeping some potential buyers indoors.

But more likely it is because there are so few homes for sale. The months supply of homes for sale is at its lowest point in more than three years and good houses are selling quickly, often with multiple offers. Would-be home buyers are scratching their heads in confusion. Wasn’t this supposed to be a buyer’s market?

Not any more. A recent article in the Wall Street Journal explained why willing and able home buyers are walking away empty-handed and frustrated because they can’t find a home to buy. In a nutshell, here’s what’s going on:

1. A lot of homeowners who bought between 2002 and 2008 are underwater on their mortgages. For all intents and purposes they are trapped in their homes until prices rise above what they owe on their mortgage.

2. Even those who are not underwater have lost significant equity on their homes with the decline in prices. That equity is what would have enabled them to put a down payment on a bigger house. They, too, are stuck until prices rise. Read the rest of this entry »

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How Long Does It Take to Sell a Wilmette Home?

The other day when we were on a listing appoitment in Wilmette, our client asked “How long does it take to sell a home in Wilmette?”

That’s a question we get asked a lot.  The best indicator of how long it will take is to look at average days on market in your town or neighborhood for the past few months. In a “normal” market the average days on market is 180 days, or six months. If the number is significantly higher than that, you are in a market that favors the buyer. Less than that means it’s more of a seller’s market.

The market’s been so bad for so long that people are surprised by the numbers we show them. The average market time is 137 days, or 4.5 months for homes sold in Wilmette in the past three months, indicating that we are no longer in a buyer’s market.

You can get an even better idea of what to expect when you sell by looking at market time for houses in the same price range as your home. The numbers can vary alot depending on the price. Right now in Wilmette houses are selling in well under 100 days for for homes priced below $2,000,000. If a home is priced in the “sweet spot” for this area ($700-999,000) the average market time drops to 30 days or less. However, once you get over $2,000,000 the market time jumps way up to 256 days, or eight and a half months.

Source: MRED LLC – Wilmette single family homes. July – Sept. 2012. Deemed reliable but not guaranteed.

While looking at average days on market is a good way to get a general sense of what’s going on out there, averages can also be misleading. Some houses sell in days, while others languish unsold for months. How quickly YOUR house sells will depend on its location, its condition, how well it shows and whether you set the list price correctly at the outset.

We are North Shore real estate specialists and one of the top teams in the area. If you would like to schedule a buyer or seller consultation with the Come Home North Shore team, please contact us at 847-881-6657 or send us a note here

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