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The Top Notch Realty Team
at Keller Williams Success Realty
presents the Illinois Housing Market,
courtesy of the
Illinois Association of Realtors
Housing Is a Hot Topic
• 2007 was a year of challenge!
• Negative headlines
• 2008 is a year of OPPORTUNITY for
serious buyers.
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REALTORS® Are Market Experts
• 60,000 Illinois REALTORS®
• REALTORS® track median
home sale prices using
Multiple Listing Data
• REALTORS® advocate for
private property rights
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Positives in the Market
• 2007 – 5th highest year on record for
home sales in the United States
• Still historically high level of sales
• Off from unsustainable peak in 2005
(National Association of REALTORS®)
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Positives in the Market
• 1 out of 16 American
households bought a
home in 2007
• Speculators are gone
• Mortgage interest rates
to average 6.4% in 2008
(National Association of REALTORS®)
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Real Estate = Best Investment!
Buying a home is the single best
investment people can make!
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Shelter
Security
Wealth accumulation
A good long-term
investment
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Real Estate = Best Investment!
• On average the value of a
home nearly doubles
every 10 years.
• The average renter’s net
worth is $4,800. The
average homeowner’s is
$171,700.
(National Association of REALTORS®)
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Real Estate = Wealth Builder
• A homeowner whose home
appreciates at a typical annual rate of
5% with cash down payment of 10%
generally will receive a 94% return on
that cash after owning the home only
three years.
(Harvard Joint Center on Housing)
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Housing - Impact on Illinois Economy
$5.5 billion or 1% of
Illinois Gross State
Product (GSP)
comes from:
Residential Property
Transactions and the
related expenditures
from buyers & sellers
(RCF Study 2007)
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Housing - Impact on Illinois Economy
$28,413 – direct expenditures related
to a housing transaction
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Housing - Impact on Illinois Economy
$11.9 Billion
Total effect of Illinois output
(purchases and sales between industries
throughout the process)
(RCF Study 2007)
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Illinois Housing Market
• Median price holding in a
steady range
• No steep declines like the
coasts
• Affordable prices
$203,000 Illinois median
$254,500 Chicago median
(IAR Market Stats, YTD Jan-Nov 2007)
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Illinois Housing Market
• Sales are lower comparing
2007 to 2006
• Illinois -16.3 %
• Chicagoland -19.6%
(IAR Market Stats, YTD Jan-Nov 2007)
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Local Housing Market
[add 1 or 2 slides on:]
• local market median
price and sales data
• positive factors for
local market in 2008
• RCF study results for
local MSA
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Housing Follows Jobs
• “The slower growth rate for jobs in Illinois,
especially outside of Chicago, continues to be
a drag on the state’s recovery from the 2000
recession.”
• It will be well into 2009 before the state
recovers its prior employment peak of
November 2000.
(University of Illinois Regional Economics Applications Laboratory 2008 Forecast)
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Homeownership Rates
• 70.4% Illinois
• 71.9% Midwest
• 68.2% United States
(U.S. Census, 3Q07)
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Mortgage Interest Rates
• 6.40% - U.S. forecast for
2008
• 16.63% – 1981 (High)
• 5.90% – 2003 (Low)
(Freddie Mac, NAR)
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A First-Time Buyer’s Market
• If you’re a first-time
homebuyer, this is one of
the best markets in years!
• Housing stock is
plentiful and there are
good mortgage rates
available for those with
good credit histories
seeking conventional
mortgages.
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Underlying Factors Support Housing
• Strong household formation fueled by
population growth.
• Immigrant homebuyers.
• Gen Y “Echo Boom” (2nd largest
generation in U.S. history)—just entering
home-buying years.
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Underlying Factors Support Housing
• The Baby Boomers remain in peak
earning years and are investing in real
estate as they near retirement.
• The economy is stable.
• Low mortgage interest rates.
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Changing Market – Local Is Key
• “Local market conditions are different from
what’s happening nationally, so it’s best to
work with a local real estate
professional to determine timing, pricing
and the best value.”
• “Homes that are priced to reflect the
realities of today’s market will sell.”
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2008 U of I Housing Forecast
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Oil prices
Consumer confidence
Presidential election
Job gains expected
for late 2008 & 2009
• Subprime effect
lingers
(University of Illinois Regional Economics Applications Laboratory 2008 Forecast)
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2008 U of I Housing Forecast
• Median price to
modestly decline in
2008 (-0.34 to -1.58%)
• Chicago market
expected to be more
buoyant than the
state (up 2.24% to
5.16%)
(University of Illinois Regional Economics Applications Laboratory 2008 Forecast)
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Top Notch Realty Team website
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Tips for buying a home
Tips for selling a home
Illinois market facts
Financing options
Free Home Valuation
Market Snapshot
Buyer & Seller
resources, and coming
soon MAP IDX
technology for buyers.
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Mortgage Lending Trends
• Credit tightening has occurred
• National REALTORS® October forecast mortgage markets are improving
• New and existing homeownership
programs help
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First-Time Buyer Programs
• NEW! Assets Illinois Homeownership
Project, www.dhs.state.il.us/assets
• 850 homeowners across the state
• Required financial and homeownership
education
• $2,000 match toward first home
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First-Time Buyer Programs
Illinois Housing Development Authority,
www.ihda.org
• I-Loan 30 - below market, 30-year fixed
rate mortgages
• NEW! I-Loan 40 - below-market, 40-year
fixed rate mortgages
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Subprime Refinance Program
NEW! FHA Secure www.fha.gov
• Allows people to avoid foreclosure and
refinance with an FHA-insured loan
• Some eligibility requirements
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More Buyer Programs
• Partnership for HomeOwnership, www.pfho.org
• Our Own Home, www.ourownhome.net
• FHA Loans, www.fha.gov
• USDA Rural Development,
http://www.rurdev.usda.gov/il/
• VA Loans, http://www.homeloans.va.gov/
• Local, state, federal programs
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Yes, the Market has Changed
• You need the
expertise of a
REALTOR®
• It’s a very good time
to buy and invest!
• Low interest rates,
high inventory!
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How a REALTOR® Can Help
• Comparable market analysis
• Set the right price
• Negotiate the best deal
• Mortgage & finance options
• Market the home
• Prepare the home for sale
• Navigate the paperwork
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Don’t Go It Alone!
• FACT: Sellers who use a real estate
professional make an average 16% more
on the sale of their homes than sellers
who go it alone.
• It’s no surprise that only 12% of sellers
chose “For Sale by Owner” in 2006.
(National Association of REALTORS®)
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Don’t Go It Alone!
• Buying or selling a
home is one of the
most important
decisions – and
largest financial
transactions –
anyone can make!
• Choose a
REALTOR® from the
Top Notch Realty
Team at Keller
Williams Success
Realty!
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