Chicago Real Estate Market Forecast 2017
The Chicago real estate market is definitely due for some changes in 2017. At first, it might seem to be taking a turn for the worse, as far as the housing market. But for investors, it may actually be a positive development – shifting from a sellers’ market into more of a buyers’ market.
Market Changes for Chicago in 2017
Prices and sales will increase, according to the National Association of Realtors. However, sellers must lower their expectations and be more open to negotiating as more savvy buyers enter the Chicago market. Cash buyers, with their advantageous position of “cash talks,” won’t be willing to spend more than the market can actually bare.
“One of the reasons for the housing slow down in Chicago is a combination of slow growth in both population and jobs,” says Jonathan Smoke, an economist at Realtor.com. The area’s population is expected to increase only 1 percent next year.
Chicago Real Estate 2017 Advantages
From an investor’s point of view, the positive thing about all of this is that the real estate market is stabilized. Maybe there won’t be large increases in appreciation, but the Chicago is a stable market with solid values. There will not be many issues with obtaining appraisals and cash offers from qualified buyers, since there are not going to be big jumps in inflated appreciation or values.
Sellers who are motivated to sell – those facing foreclosure, high property taxes, probate and other unfortunate situations – will have to adjust their expectations and be willing to negotiate.
Investors should look at the shift to a buyers’ market as a positive trend, and realize that their power will lay in their negotiation skills and educating sellers to the market. Since Cook County is still one of the top counties for real estate cash transactions in the U.S, it has a ready and qualified pool of cash-ready buyers.
Top Tips for 2017 Chicago Investors
In summary, here are my recommendations for investing in the 2017 Chicago real estate market:
- Learn where to locate highly distressed properties; pre-foreclosures and delinquent property taxes are at the top of the list, and there are over 60,000 tax delinquent properties in Cook county alone.
- Learn how to negotiate with the sellers and present solid facts while making each proposal a win-win situation.
- Locate cash buyers, who are really strong and available in the greater Chicago area, as Cook county is #3 in the nation for real estate cash transactions.
Also, suburbs and city redevelopment will both have a strong appeal. The millennial generation is increasing their purchase power in 2017, giving them more favorable lending terms and less stringent bank requirements. Generation Z (those born in the late 1990s) is entering the buyers’ market as well. So, there is definitely a demand for 1st-time home buyer properties in the mid-price range which are located near public transportation routes and “safe” areas – both in the suburbs and the city.