Welcome to the October edition of Monday Market Minute with Carrie McCormick!
In this episode Carrie talks about how the Chicago market has started showing pricing discounts due to home sales being down (more than any decrease in the past seven years). Where are the buyers and why have they dropped off? The good news is that there are several neighborhoods in Chicago booming right now and Carrie shares those with you. Then, I provide a marketing tip about working with renters in a down sales market and how 46% of buyers right now are first-timers (previous renters).
D.J. Paris 0:13
Hello, and welcome to another episode of Keeping it real. The only podcasts made by Chicago real estate brokers for Chicago real estate brokers. My name is DJ Paris, and today is our regular monthly episode The Monday market minute with superstar producer at properties broker Carrie McCormick, welcome. Oh, thank you, as always, well, just in case this is anyone’s first time and they have not heard you on the show before. You’ve been in the business almost 20 years, or is it over 20. At this point,
Carrie McCormick 0:42
I’m going to stick with 1920 Just makes it sound like a long time. So it’s been 19 years, almost 20. Actually, January will be 20.
D.J. Paris 0:51
And not only is Carrie been a producer for quite some time, of course, she is a top producer, top 1% producer and even more than top 1% She is actually always in about the top 15 brokers in all of the Chicagoland area, year after month after month, year after year, which is a big deal because there’s about 40,000 of them. So for her to take time to be on the show, she does not have time to do the show. And yet she still does. And she comes on every month and talks about what’s going on in the market for Chicago as things brokers need to know and buyers and sellers. And we are so grateful that she does this on a Saturday when she I’m sure has a million other appointments. So thank you again.
Carrie McCormick 1:30
Well, thank you love doing it.
D.J. Paris 1:32
Alright, let’s get started. What’s going on?
Carrie McCormick 1:35
Well, we have been dodging this day of reckoning, but all Chicago people know winter is coming. And when winter comes, we start seeing price cuts here and we’ve seen them over the last couple of weeks, we start seeing price cuts, price changes, you know, just a nice shift in this market here. And for the past several months, I would say there’s been a lack of motivation on the buyer side. So this month’s home sales have declined a whopping 15% from last year, which is the biggest decline in Chicago in more than seven years. I think last month, it was about 7%. And this month now we’re hitting 15%. So it’s a big, it’s a big drop. And every day, when I’m talking with my buyers, and obviously mostly my sellers, I get the question of where are the buyers? And why is the market slow? Well, it’s just not here in Chicago. And it seems to be nationwide. So as a matter of fact, yesterday, I was speaking with a another agent from the Ohio market, and then an agent from Tennessee market. And everyone is sensing a slowdown. It’s whoever I talked to whether they’re here in Chicago, or in another state, everyone’s sensing a slowdown. And, you know, there are several factors that have dampened our demand. The Of course, the change in the federal tax code that Trank deductions for property taxes, and we’re seeing an uptick in the mortgage rates that have changed the overall affordability of owning a home. It’s not that just people are afraid of the rates, because historically they still are low. But it’s really the the affordability of of owning a home and the price point that they can buy in. And some p some people, some buyers have reached their limits of what they’re willing to pay. And this applies across the board. I’m not just seeing it was savvy, you know, buyers and investors, it’s first time homebuyers. It’s move up buyers and investors as well. Go ahead.
D.J. Paris 3:41
Yeah, no, you’re right. And I know mortgage applications are down seven to 10% On average right now as per even over like a month ago. So you know, I know rates aren’t everything, but boy, they’re really affecting people’s willingness to even move forward.
Carrie McCormick 4:00
And it’s important being in this market, you know, being a real estate agent, this market of having your, your network of people because I talk with the title companies all the time I talk to my mortgage lenders all the time, the inspectors, you know, the appraisers, everyone that’s involved in the process of, you know, buying and selling a home and just talking to them about the market and what they’re seeing and what they’re experiencing. And it’s it’s the same, you know, we’re all in the same boat. But but you know, there’s some buyers out there and the buyers that are out there, they do want to deal. They want new construction, it seems like the resale homes are getting hit a little bit harder than the new construction. And if it is a resale home, people want to deal you know, they want they want a good deal.
D.J. Paris 4:46
Yeah. Now, are there any are there any areas in the city here that are still doing well, despite, you know, the overall slowdown?
Carrie McCormick 4:54
You know, that’s that’s a really good question. So yes, most of the neighborhoods have cooled down here in Chicago. But Logan Square has really turned up the heat. And there was a recent article in cranes just about Logan Square. It was a really interesting read it was just the other day. And they did say that the single family homes in Logan Square shot up more than 19% this year. And that that data came right out of Chicago Association of Realtors, and also the number of horses that sold there. Almost 9% In the same period. So we’ve got Logan Square did really well. Another neighborhood called Avondale, which is just a little bit north of Logan Square has stayed warm, they shot up about 12%. And then also I’m starting to see some Southside neighborhoods showing some increases, there was a neighborhood, Auburn Gresham, Roseland, South Chicago, if you look at their numbers, you know, they’re they’re staying warm down there. Now their numbers are doing pretty well. But I always tell people hang in there, you know, this is Chicago, we’re a very resilient city. Everyone needs a place to live. You know, we just we have these downturns and been in this industry for 19 years, I’ve been through this before. You know, we just got to work hard price homes, right? And just stick with it.
D.J. Paris 6:16
Well said, and for everyone who’s listening, you can also submit your questions to Carrie directly, so you can send those to us. If you’re not already following us on Facebook, just facebook.com forward slash keeping it real pod. Also keeping it real pod.com Or website, you can submit questions through that as well. Let’s move over to my marketing idea, my marketing minute for the week. And I’d like to get Kerry’s thoughts on this too. So I was recently very, very grateful. I was invited by Zillow to come out to New York and see their New York operation which was super cool. And they were nice enough to have me out there. And they just recently about two weeks ago or so are released their 2018 consumer housing Trends report. It is awesome. So just so that everyone knows, obviously we know who Zillow is, but how big they are is really impressive. 186 million individuals visit zillow.com every single month. So they just aggregate Oh, it’s incredible. They they know more, they have more data on buyers and sellers than any other company. It’s super, super critical. So they aggregate all this data, they you know, just publish it for free. I’ll post a link to this report because it’s super cool. Whether you’re a consumer or broker, you should check it out. But there are two couple stats that really shout out at me that I think brokers could use in their marketing. Number one is home. We’re talking about homebuyers only here 42% Of all homebuyers are millennials and that’s interesting to me is a huge number a huge number. And then the other number is 46% of all homebuyers are first timers. Now maybe that’s not so surprising to people listening. It’s something that I always forget. So we’ll just round that up to 50%. We’ll say half of all homebuyers are first timers. And brokers of course, no, that’s the low hanging fruit. These are people who have traditionally not worked with a realtor before. Maybe they worked with one to help find an apartment but probably not. So you you have one out of every two people buying a home has probably never worked with a realtor before. So what can a broker do with this information? Seems a couple of ideas. Number one, and I know brokers typically don’t get their real estate license to do rentals, right? That’s not anyone’s probably most anyone’s dream. But it’s an opportunity to build a relationship right away. So if you’re not flushed with sales, and it’s a little slower, because the markets slow down, and you have maybe fewer buyers or sellers at the current moment, maybe reach out to some of your rental rental clients and maybe help them find an apartment or the second part is if you really don’t want to do rentals, but you still should work with rent with people who are currently renting because those are future buyers, as we know, and half of all buyers are first timers. So these are people that are renting right now. What I my idea for everyone is to reach out to companies that have a lot of employees that are younger, maybe millennials, and this this was me. Many years ago, I worked at a technology firm, there were 150 of us all in our 20s I’m guessing 95% of us were renters, but we were starting to make more money in our late 20s. And I thought boy, it wouldn’t have been smart for a realtor to come in and say you guys should be thinking about buying in the next year. And all they would have needed to do is reach out to our human resources department and say, Hey, can I come in and bring in lunch and talk about the path to ownership and then maybe bring a lender in and an attorney to help share the cost of bringing in lunch and do a 15 minute presentation and I guarantee that realtor would have walked away with a ton of clients, or at least a ton of opportunities for clients. So this is something where you can reach out to your sphere of influence. Ask them where do you work? What’s Your office like, Do you have a lot of younger people? Do you have people that may be thinking of buying? Or maybe you just want to work with renters right now and say you have people renting I’ll help them too. But you can reach out to these companies and offer your services. Right. So that’s an opportunity as well to just think about how do I get in front of more people that are currently renting, that are maybe going to be buyers? So Carrie, do you have any any thoughts on that?
Carrie McCormick 10:24
That’s actually a really great idea. And I have never done that. But I think I may use your idea.
D.J. Paris 10:32
Yeah. So I do it. Well, yeah. I mean, all it would really take is reach out to some of your existing clients and say, Where do you work? What’s what, how many people are there? If I reached, could you talk introduce me to the human resources person or whoever? I don’t know. Just something to try. And I do love renters.
Carrie McCormick 10:46
I think that’s, you know, you can’t dismiss the whole rental pool because the renters turn into buyers and you know, these people, no other people. So it’s I love rentals. I think it’s a great a great tip you have
D.J. Paris 11:02
Yeah, I interviewed an app properties broker, Susan Panozzo. A little while ago. Yeah, I know, you know, she does like 100 rentals a year and then gets like 20 sales a year out of those rentals. So anyway, all right. Well, that’s that’ll do it for this week. Oh, follow Carrie. First of all, everyone needs to follow Carrie on Instagram. It’s It’s unbelievable. She has absolutely without exception, not just because she’s on the show. But this is the Absolute Truth. The very best real estate broker Instagram account I have ever seen. And that’s Carrie McCormack real estate. Which it’s incredible. She does it all herself. She doesn’t hire an agency. It’s pretty cool.
Carrie McCormick 11:42
I do. And I get I get that question, honestly, at least once a day as Who does your social media? And I say I do that like No, seriously, who does your social? I do. I love doing it. It’s fun. And I enjoy it. So But anyways, anyone that has any real estate questions, I’m always open to a phone call, or a text message or email. I’m always here to help love to share some of my ideas with people. If there’s any questions you have, I’m always willing to give back.
D.J. Paris 12:12
And if you’re a consumer, and you’re looking for a realtor to work with, well, I would want to work with the person who’s the 15th highest producer out of 40,000. That’s who I would choose. So how could How can somebody reach you via telephone or email?
Carrie McCormick 12:25
Of course, so my cell phone is 312-961-4612. And I do try to answer my phone all the time. You can text me as well that number or you can email me at Carey ca RR ie firstname.lastname@example.org.
D.J. Paris 12:44
Well, that will do it for another Monday market minute. Carrie is so generous. We’re so grateful that she does this. And again, she doesn’t have time to do this. In fact, we know we were supposed to do this at 11 o’clock and Carrie says Can we push this back 15 minutes I have an appointment. So that is how incredibly busy she is. So thank you. Thank you. And on behalf of Carrie and myself, we will see you in a month and thanks for listening. Thanks Carrie.