Recently Zillow.com put out their mid-year report on the top buyer and seller markets in the US. The report claims that “the Chicago, Milwaukee and Cleveland metros are buyers’ markets, with homes taking longer to sell and buyers logging average discounts of 5 percent off the asking price“.
So, how does Zillow’s report affect you?
Things to think about when you are negotiating an looking for buyers
- If the property is a fix-n-flip, adjust your numbers accordingly. If you estimate that the selling price to be 160K, take 5% off, and its now 152K. From the time you look at a property until the time it goes on the market, you are looking at 3-5 months, which brings another cost, holding costs.
- Use this information when negotiating with sellers. Every seller thinks they are giving you a great deal, which may be true, but you should hold out a bit more before agreeing to a price and use this information as leverage.
What is considered, “Chicago” anyway?
The Chicago Tribune further helps further explain what Zillow meant when it says, “metros”. Suburbs like Downers Grove, Northbrook, Palatine, Buffalo Grove and Orland Park are the top buyers markets, which makes sense because, 1. The purchase price is going to be higher than normal and, 2. Those who do qualify to buy in those areas are more likely to know how to negotiate and take their time.
What about Chicago, the actual city?
Since I am from Chicago, I do not consider those metro areas Chicago or anywhere near. So when I come across these reports, its hard for me to imagine what they are really talking about. Either way, the same information can be applied to the city itself since a major reason that the prices are so negotiable is our foreclosures. According to the recent reports, foreclosures in Chicago rose 54% in June when compared to the same month in 2011.
So if you are wholesaling or investing, you should read this information carefully and make your own adjustments and always do your own research. Information like this is always valuable when negotiating.
Let us know what you think below!
