The Housing Value of Every County in the U.S.

The Housing Value of Every County in the U.S.

I recently came across this map posted on Twitter by Max Galka of Metrocosm.com.  It shows a map of the U.S. with the land area of each of the individual counties being substituted by the total market value of the housing.  Keep in mind that this is the sum of the values for each county, which is going to be skewed by population; nevertheless, this GIF is way too cool not to share.  


I found this map is really hypnotic.  Several times while typing this post I have found myself zoned out just staring at it.  Anyone else?

Also, I would love to see this type of map that separates out all of the Chicago neighborhoods and suburbs.  My guess would be the North Shore, downtown and Lincoln Park in Chicago, and the Hinsdale/Oakbrook area would be the largest.



Best Time to Buy or Sell Chicago Real Estate

 

I recently read an excellent blog post by Gary Kristensen (click here to read).  I thought I would similarly take a look at the Chicago market and try to graphically depict the best time to buy or sell in the Chicago real estate market.  As we all know real estate is seasonal in most markets with the school year being a big factor, but more so in Chicago due to the blustery winter months.

I exported every monthly data point from the S&P/Case Shiller Home Price Index dating back to 1986 (that’s 336 total data points and 28 monthly data points which should be a large enough of a sample to account for any outliers).  I then averaged each month and charted the results…..

 

Chicago Case-Shiller Chart

 

 

As you can see, it appears as if the worst times to sell would be January through April (all below the yearly average).  Also, keep in mind that these are closed sales which most likely went under contract 1-3 months prior.  So while August appears to the best, those homes most likely went under contract in July and originally listed for sale in April or May (assuming a 60-90 day marketing time).

As Gary astutely points out in his post, most people who are selling a home are also buying a home.  Therefore, in these cases, trying to time the market isn’t necessary.  For those who are only selling, it looks like listing in May or June would be best (assuming we add 60 day marketing time and 2 months to close).  I have also heard an interesting thought from one Realtor who said he loves to list a home and have an open house the Sunday in February after the Superbowl.  He said he does this to get ahead of the market and also he gets a tremendous amount of traffic.  He thinks it is because many women who want to get a head start looking at homes are finally able to get their husbands out of the house on a Sunday. This is clearly anecdotal evidence (and kind of funny), but an interesting approach nonetheless.

Oddly, December had the second highest average that I could not account for.  I showed this to a few other real estate appraisers.  They weren’t sure either and thought this could be corporate transfers coming in prior to years end for write offs to people trying to close before the snow comes.  If you have some thoughts are what is causing this spike, please add them to the comments below.  Also, when is your favorite month to sell.

 

Rowe Appraisal Group specializes in appraisals for divorce, estates (date of death), pre-listings and more throughout the Chicagoland area.  If you have any questions, please call us at (847) 863-5776 or email paul@roweappraisalgroup.com.

 

 

Top Factors Affecting Your Chicago Real Estate Value

I often get asked while completing appraisal inspections, “Do you count X when you do appraisals?”.  The short answer is that we try to consider everything that a typical buyer for that property would consider.  Below are some of the top factors affecting home values from a Chicago real estate appraiser’s perspective.

 

Location or Neighborhood

In Chicago, the neighborhood you live in can have a drastic effect on your properties value.  Your home’s proximity to public transportation (CTA or Metra stations) as well as restaurants, shopping, grocery stores, quality schools, parks, etc all affect value. Conversely, having a location with noise pollution can have an adverse effect on your home’s value (directly across from train tracks, on a busy street, next to a gas station, etc.)Es war einmal in Deutschland 2017 movie download

 

Gross Living Area (GLA)

GLA is defined as all liveable space that is 100% above grade (Gary Kristensen has a great article and video that goes into further depth). The amount of value per square foot is determined on a case by case basis depending on many factors.

 

Condition or Effective age

The effective age of the home is determined by the amount of updating or overall condition. For example a home built in 1955 could have a 10 year effective age if the home has recently had a significant amount of renovations completed. Keep in mind that just because you spend $25,000 on a new kitchen that does not necessarily increase your home’s value by exactly that amount.

 

Quality of Construction

This refers to the materials used to build the home and the overall quality of finishes on both the interior and exterior. For example, an all brick home compared to a home with aluminum siding or stucco, granite countertops compared to laminate countertops, hardwood flooring compared to carpeting, solid core 6-panel interior doors compared to hollow core flat panel doors, etc.

 

Lot size

A larger lot can add significant value. This is especially true when looking at possible “tear downs” in Chicago because the size of the new construction home is typically limited by the zoning department to a percentage of the size of the lot. A 30’ x 125’ lot compared to a 25’ x 125’ lot can have a significantly higher value in areas where there is a demand for buildable lots like Lincoln Park, Old Town, Gold Coast, etc. As you get further out on the northwest side and there is not as much demand for new construction, a larger lot could mean room for a side driveway.

 

Bed and bath count

Generally speaking, more is better. However, in many neighborhoods there is no discernable difference in value between a 4 bedroom and 5 bedroom home. The law of diminishing returns typically will apply. For example, the difference in value between adding a full bath to a 1 bath home is typically greater than adding a 4th bath to a 3 bath home.

 

View

This can be best demonstrated by condos in Chicago high rise buildings. Two units that sold at the same time, with the same floor plan, located on the same floor, but with different exposures will likely have different values. The one that faces west and only has a city view vs. the other unit that faces east and has a view of Lake Michigan can have as much as a 10-15% difference in value.

 

Additional features

These are things like fireplaces, decks, porches, patios, garages, landscaping, layout (open floor plan vs. closed/boxy layout), etc.  Jeff Hamric discusses floor plans with functional obsolescence here.

 

While these are the top features that influence value, there are many other things real estate appraisers consider. If you have any questions on how any of these items may specifically affect your situation, please feel free to post a comment below or call me at (847) 863-5776.

Chicago (Lincoln Park) Condo Market

Lincoln Park Condo MarketBased on recent speculation in the national news about a cooling housing market, I recently analyzed the Park Ridge market to get to see where prices might be heading.  This time I will be looking at the Lincoln Park neighborhood in Chicago.  I wanted to compared the current median sales prices vs. those that are under contract and are expected to close in the next 30-60 days. First lets look at a few charts to see how the market has performed over the last year.

 

 

Year-Over-Year Median Sales Price (Rolling 12 month average) – As you can see below, while the overall condo market is up 5.6% year-over-year, the upward trend appears to be flattening out and the market appears to be stabilizing.

 

 

Months supply of inventory – Supply is down to 2.9 months of inventory but is slowing creeping back up.  (down 6.8% year-over-year)  Whenever supply is below 3 months of inventory we consider the market to be under supplied.

 

Average Market Time – The average time it takes to sell a house is significantly less (down 27% year-over-year) but this indicator is also flattening out with the last 4 months having an average market time of 57 days.

 

 

List to Sales Price Ratio – The amount the home sells for vs. what it was most recently listed for has only increased about 0.6% year-over-year and has leveled off at a strong  98%.  (This can sometimes be skewed as many condos are listed with parking “not included” and then the final sales price includes a $10,000-$25,000 deeded parking space.

 

Distressed Sales – As you can see below the number of REO (foreclosures) and Short Sales haven’t been a big factor in Lincoln Park over the last few years but still show a positive sign as they are down 49% and 64% year-over-year.

 

 

 

Overall, while the market has had a good year, these statistics are considered to be in the “rear view mirror”.  As I analyze the market to help homeowners determine an appropriate  listing price for their home, (click here for more info on that process) I analyze forward looking indicators in an effort to be aware of what may be in store for the market.

I decided to use 2 bedroom/2 bath units in an attempt to break out the extreme high end and low end of the market and compare apples to apples.  After noting the current median sales price of $408,000, I compared those two data points to a more forward looking data point, pending sales.  The current median list price of the units currently under contract is $394,000.  That is approximately 3% lower than what has sold over the last 12 months.  With the exception of a few hot markets, homes very seldom sell at list price.  Over the last 12 months, the list to sales price ratio is approximately 98% (see chart above).  Therefore, once the 2% is removed from the pending sale to anticipate the final sales price, there is still a projected decrease in median sales price of 5-6% for those units currently under contract vs. the current 12 month median sales price. Due to their only being approximately 50 units in the pending/under contract data, I expanded the data to include all active listings as well.  That brought up the median list price to $400,000 (2% higher than the “under contracts”).  But keep in mind, these listings could still experience a lowered list price as they are still not under contract, which could account for the 2% bump.

In summary, while the overall market has been strong over the last 12 months, the Lincoln Park condo market in Chicago does appear to be slowing.  However, with such a low supply of inventory on the market, things could turn back up.  Also keep in mind that we will soon be heading into the seasonally slower fall and winter months.   For more Lincoln Park charts check out our Lincoln Park Page.  If you have any questions, please feel free to call us anytime at (847) 863-5776.