There's been much talk (chatter by the national talking heads) in the media about our Northwest Suburban and Hoffman Estates home values returning to a previous level. I read these reports constantly, day in and day out and wonder to myself 'How do they know this stuff when I don't even know it!'
Real estate is unique in that it is very local in nature. In fact, real estate is so unique it can even be broken down further to say that neighborhoods even in the same town will been effected differently. What happens in one subdivision doesn't necessary happen in another. What effects one subdivisions appeal doesn't effect another that's even similar. So 'painting with a broad brush' is not possible in our Hoffman Estates neighborhoods.
Any Hoffman Estates real estate professional I will challenge because they cannot say with absolute certainty that market prices have fallen 10% or even 20% (you pick the number here). 'Painting with that broad brush' just cannot be done. Many variables have effected your home's values and each subdivision should be considered on it's own merit.
How many short sales have been in the area?
How many foreclosures have decimated prices?
One constant that I will say with certainty is that the more homes for sale in a particular subdivision essentially effects the overall sales prices. The more sellers that compete for the smaller buyer pool effects the sales prices. Each seller is eager to obtain their own goals whether a transfer, death, birth or divorce. It's the economic market standard of supply and demand.
The graph that I present is for the average sales prices per year for Hoffman Estates homes. I've given you a 10 year sampling of prices (MLS closed only) so you can actually see the rise of the market and also the fall. According to this graph, 'prices have corrected themselves' to 2002 sales levels.
We need less homes on the market to create the equilibrium for prices to increase in the future.
Market Update
Disclaimer: NAR (National Association of Realtors) does not provide these numbers to their members. MRED, the area MLS, does not provide this figures which I had to compile for this presentation. I feel confident in their accuracy to report to my readership.
Good Morning Lyn, as we head into the new year, I wish you much success and happiness . ~Captain Wayne Rowlett~
Thanks Captain Wayne, prosperity to you & yours in 2012.
In my market there are 30% less homes on the market then in 2010. We are seeing an increase in home sale prices and a significant decrease in supply. I am still a little scared of shadow inventory in 2012. What percent of homes in the Hoffman Estates Neighborhoods are in the process of foreclosure or foreclosed upon and not listed?
Lyn -- you are exactly right -- generalizations in real estate can be very dangerous. In nearly every community there are nuances in the market that can seemingly change a market. It's really about knowing those nuances and being able to explain them to a buyer or seller so they can know how to better make their decision.
Best of success in 2012 - Happy New Year.
Lyn - Great information for buyers and sellers to have. Knowing what is going on in your local market is the key to success.
This is why it is so important to choose and work with a local agent - one who knows these statistics inside-out.
Lyn: Great report, presented very well. My father-in-law, a farmer, used to say it could rain on one side of a road and be completely sunny and dry on the other. True ... and real estate is very similar. You point that out clearly in your post. You also make a great case for seeking a local, perhaps even subdivision-centric professional agent to assist you in your home search. Yes, real estate has become that detailed and local ...
Congrats on the Feature!
Gene
Congrats on the feature! Great post, loved the graph. Those talking heads sure do make some interesting reports don't they. Thanks for sharing and have a great weekend.
Hi Lyn,
Beautiful graph and good post.
You would be my realtor if I relocated to your area.
Phil
Lyn, another great example showing where real estate is local. Its these generalizations that hurt the overall market.
Hy Lyn, great information presented well, with a nice graph too. I'vee wondered the same thing and have usually found that the basis for my information is more sound.
Sandy: We each have to find out about our own local areas & just work with those numbers.
Michael: Media offen paints with a broad brush on many topics.
Phil: Thanks!
Angel: Sometimes yes, in this case no.
Gene: You have a wise father-in law.
Margaret: Couldn't agree with you more, you're area even though close, will be totally different.
That is why I break it down by micro neighborhoods rather than the entire city. Each area was hit very different, some areas saw 25% decrease, while others saw almost a 50% hit. If you look beyond a neighborhood for a number, you are setting yourself up for failure.
Todd: Can't judge each subdivision by a broad statement as you say. It's not correct or professional for that matter. The national media doesn't care.