home buyers

Mortgage interest rates: good news for home buyers and sellers

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A few weeks ago a potential buyer of a home in The Glen (in Glenview Illinois) told me that he was holding off buying a home until mortgage interest rates improve. I believed that was unwise, so I researched historical 30 year, fixed rate mortgage interest rates using Freddie Mac data. I grouped them into 5 year periods and calculated the averages. What did I learn…that recent mortgage interest rates are roughly half what they were 25 years ago!

The average rate in August (the most recent data available) was 4.12% for a 30 year fixed rate mortgage. This is a smidgeon higher than early months of 2013. Rates, however, have inched downward in each of the last 4 months; and that August rate of 4.12% is actually lower than the same month last year. So it is clear that home financing today is extremely low. While rates may bump along with modest increases and decreases in the short term, there is no evidence that they will become appreciably lower in the foreseeable future. In fact, it is likely that rates will eventually increase to more normal levels.

Interest rates matter…a lot…because they affect a buyer’s monthly payment and the total cost of financing over the period of ownership of a home. Every 1% rise in interest rates reduces buying power by approximately 11%. Obviously today’s low interest rates are beneficial to home buyers, but they are also good for home sellers. If buyers can purchase more house because of low interest rates, there are more qualified buyers for sellers’ homes.

If you are interesting in buying a home in The Glen or greater Glenview, please email me at Margaret.ludemann@cbexchange.com or call me at 847-401-1802.

Margaret Ludemann, Glen homeowner and @properties Realtor

Real estate in The Glen: August lull, September to pick up

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I have a Glen-specific, proprietary website. In fact you may be reading this blog on that site. It provides information about real estate in the Glen (in Glenview Illinois)and allows visitors to search Glen listings. The search engine optimization firm that I employ provides the tech-marketing magic that brings prospective home buyers to the site; and I am provided with numbers of all kinds weekly.  These numbers show a late summer slow down in the Glen, which is seen nationally as well. In the 4 week period in May over 2,000 first time visitors came to my site. (This is a very POWERFUL tool!) The following 4 week periods declined by 7.6%, 6.7% and 10.9%. In the last two weeks alone (August 10 – 24) the number of first time visitors was down 35% from May. Looking at the site’s first time visitors in previous years shows this same pattern.

The good news for prospective home sellers in the Glen is that the number of first time visitors increases in September and then remains relatively even and strong until December. This trend is supported by my site’s prior-years data. So homowners thinking of selling, should be getting their homes on the real estate market soon to take advantage of the increase in buyer interest just around the corner.

But it’s not only buyers who take a real estate time-out in mid-to-late summer. The listings cupboard in the Glen is pretty bare right now, too. Of the 237 single family homes in the Southgate neighborhood, there is only 1 home listed for sale. The same is true in Tower Crossing, the large, 4 story brick townhomes adjacent to Glen Town Center. In that development there are 154 homes, but only 1 is listed for sale. At the Landings (formerly Concord) and Chapel Crossing neighborhoods (with 311 homes combined) there are only a couple of listings.

Spring interest among buyers is matched by sellers who want to take advantage of that peak selling season. People with children want to make their purchases and get moved in before the new school year begins. In mid-to-late summer interest drops as I’ve shown above; and smart sellers know this so many get their homes on the market in late winter/early spring; and conversely there are few new listings in mid-to-late summer or from Thanksgiving until early March.

Margaret Ludemann, Glen homeowner and @properties Realtor

MargaretLudemann@gmail.com   847-401-1802

Home sales surge, prices rise, time on market falls in The Glen

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2013 was the year that Glen homeowners have been waiting for.  The Glen is an upscale residential and retail development in Glenview, Illinois in the Chicago area’s North Shore. The real estate market for its homes was exceptionally strong.  Sales were up considerably, prices rebounded nicely, and the time it took to sell homes fell.  Further, nearly every Glen home listed for sale in 2013 sold.

Broad economic factors positively influenced existing home sales in the U.S. which gained 9.3% for the year.  The U.S. economy gathered strength through 2013.  Job growth continued to climb.  According to the Bureau of Labor Statistics the unemployment rate fell to 7% by November 2013 from 7.9% in January 2013 and from its recent high of 10% in October 2009.  Interest rates remained at historically low levels, though they inched upward during the year.  Low rates and the prospect of higher future interest rates served as incentives for many potential home buyers.  Stocks soared during the year with the S & P 500 gaining 29.6% which no doubt made potential home buyers feel more financially secure.

Years of declining values once again brought many bargain hunting investors into the U.S. housing market.  Pent up demand by trade-up buyers also fueled the increase in home sales. 

As prices rose during the year fewer homeowners found themselves “under water” (homes worth less than the mortgage balance), thereby reducing their incentive to sell.  This resulted in a decline of available housing inventory.  Over the last several years sellers far outnumbered buyers, but that was reversed in 2013 giving sellers the negotiating advantage.  The result…further improvement in home prices.

It was the best year for home sales and prices in years, and you will see that reflected in my future blogs dealing specifically with sales of Glen homes.

Margaret Ludemann

Glen homeowner and @properties Realtor