The simple logic of the law of supply and demand dictates that when there is less of something, it sells more quickly and for a higher price. In the real estate equation, those simple assumptions are born out in the important stats that are scrupulously tracked each month. According to a RE/MAX analysis of data reported by Midwest Real Estate Data, average Chicagoland days on market fell by a third.
That important metric went from 139 days in 2012 to 93 days in 2015. The last time homes sold as quickly was 2006.
Jim Merrion, regional director of RE/MAX Northern Illinois, sees two primary reasons for the sharp reduction in market times.
Home values in Chicago are rebounding with little supply
The increase is raising the confidence of potential buyers who are deciding to get off the sidelines and get serious about signing a deal. But, that’s not offsetting the insufficient number of sellers who are driving the supply side of the equation.
The inventory of homes for sale, especially when distressed properties are excluded, has remained limited for the past two years. Buyers must act quickly, because desirable homes frequently attract multiple offers.
The home search has gone virtual
Both buyers and brokers have new tools at their disposal to make the home buying process easier and faster. The rapid rise and new ubiquity of text messaging allows faster communication.
And that smartphone is good for a lot more than texting and snapping selfies. Smartphones allow buyers to use mobile apps to view new listings and set up a showing immediately.
Widespread adoption of virtual listing tours has also saved shoppers time in quickly eliminating homes that they prefer not to see. And, value calculators and estimators have given buyers confidence in making an appropriate offer.
Agents in the metro market see the impacts of these two factors every day.
“Buyers usually have a fairly good picture of the market when they start house hunting seriously,” said Liz Sidorowicz of RE/MAX Premier Properties in Chicago, in a statement.
“Those I’ve worked with recently, especially younger buyers, rarely need more than two months to find a home because they are so well prepared. Not many years ago, that process would have taken four to six months.”
