Chicago Market Conditions: Agents vs. The Experts
The Chicago Tribune had an article in the Sunday Business Section called, “‘Bottom’ Proving Elusive” about whether or not now is a good time to buy real estate in Chicago.
There were several examples of people choosing to buy properties now that were priced under 2005 prices. In some examples the buyers were getting 20% to 25% off of asking prices.
The piece is filled with varying advice.
One the one side, you have the agents:
“By the end of December, there will have been 93,000 to 95,000 homes that will close this year in the Chicago area,” said James Merrion, regional director for Re/Max Northern Illinois. “The public has the impression that nothing is selling, [so] they’re surprised to hear that.”
“I seem to be having an end-of-the-year clear-out,” said Chris Grayson, a Glen Ellyn Baird & Warner agent. “I’m not floating my own boat, but I’ve sold five houses in the past two weeks, some listings that have sat there since April. It’s been very unusual.”
Chicago-based Rubloff agent Mario Greco said he returned from a three-week vacation a few weeks ago to find that his staff had sold nine homes, which he described as his busiest December ever. “Is it a sign of a hot spring, pent-up demand releasing, or an end-of-the year rush or all of the above? I think it’s all of the above,” he said.
A “hot spring”? “Pent-up demand”? “End of the year rush”?
On the other side, you have various economists and real estate experts:
“If you’re looking at an area where there is job growth and economic growth and thinking about being there for five years, now may be a good time to buy,” said Mark Dotzour, chief economist at the Real Estate Center at Texas A&M University.
“But if you have some likelihood that you would have to move in one to two years, then I would be nervous.”
“No, it is not a good time to buy a house,” said Susan Wachter, professor of real estate at the Wharton School of Economics at the University of Pennsylvania, who sees further turbulence in the economy.
“I wouldn’t say never, but I am close to never. Prices are going to decline in the next period, by another 5 percent or more,” she said. “Without a recession, 2009, not 2008, could see the bottom of the market; with a recession, all bets are off.”
Who will be right?