Elmhurst Real Estate Guide (Q3 2020) by Kelly Stetler Real Estate

Q3 2020

ELMHURST

LOCAL REAL ESTATE GUIDE

OPENING NOTE Over the last few months our communities re-opened, schools started, and sports returned while we adapted to a new normal requiring flexibility, patience and awareness. During this time, decade-low home availability and Summer buyer demand fueled a hot Elmhurst housing market. While seasonality is a factor this time of year, there is still a need for new listings to satisfy continued buyer demand.

[Update Picture]

This quarter several of my favorite local experts have contributed insights on real estate topics ranging from kitchen trends to understanding home loans and how to navigate home inspections. I hope you find this content interesting and valuable. For the cover I chose our iconic York Theatre. This place is my familyâ&#x20AC;&#x2122;s first choice for movie night! All my best,

630.750.9551 kelly.stetler@compass.com www.kellystetlerrealestate.com 2

WHAT’S INSIDE New Listings

Contracted & Closed

(Bob Fornatto, Wintrust Mortgage)

Home Inventory

Kitchen Trends

Contract Time

Price Discounts

Price Per Sq. Ft.

FEATURES 9

Loan Considerations Understanding Mortgage Types

Current Trends for Your Kitchen

Compass Listings

Highlighted Sale

(Michelle Polay, Polay Interiors)

Negotiating Inspections Negotiating in Today’s Market (Themis Katris, The Katris Law Group)

Crafting a Winning Offer

Closed Sale Prices

Winning the Home You Want (Kelly Stetler, Compass Real Estate)

EVERY ISSUE 3

METHODOLOGY Overview of Terms and Elmhurst Submarkets NORTH CLOSED: closed transaction reflecting the final sales price (does not include any seller credits)

(North of North Ave.)

CONTRACTED: contingent or pending transaction reflecting the latest asking price CONTRACT TIME: number of days between the first list date and the contracted date (does not include time from contract to close)

CENTRAL WEST (Prairie Path to North Ave. and Rte. 83 to York St.)

CENTRAL EAST (Prairie Path to North Ave. and Hwy. 290 to York St.)

HOME INVENTORY: number of homes currently available for sale MEDIAN: middle value of a given dataset (all report values are medians, which are less impacted by outliers than averages) PRICE DISCOUNTS: percentage difference between the initial list and recorded sale price PRICE PER SQ. FT: ratio of the price to the square footage of a closed transaction as a relative price measure (factors in home size)

SOUTHEAST (Prairie Path to Butterfield Rd. and Hwy. 290 to York St.)

SOUTHWEST (Prairie Path to Butterfield Rd. and Rte. 83 to York St.)

Note: All figures represent detached single-family homes unless otherwise specified. Price range data based on the city of Elmhurst. Submarket figures based on the approximate areas identified on map above.

MARKET SUMMARY “Seller’s Market” Conditions Remain with Very Low Home Availability

Strong Buyer Demand

New Home Listings (Q3)

Contracted / Closed Homes (Q3)

Lower New Builds

New Home Permits (YTD)

47%

New build permits stabilizing with July and August up YoY

Fewer Available Homes

Sept. Month End Inventory (YoY)

36%

“Seller’s market” with 13+ year low of available homes this time of year

Short Market Times

Original List to Contract Days (Q3)

Narrow Price Discounts

Closed Sale Price Discounts (Q3)

Tightening discounts of 3% – 4% or less of original list price

Mixed Sales Prices

Sale Prices / Price Per Sq. Ft. (Q3)

Split market with <$700K increasing and $700K+ showing some softness

35%

Less than 25 days across submarkets and price points (except $1M+)

NEW LISTINGS By Price Range

Rolling Last 12 Months (YoY%)

 Owners have yet to notably increase new listings after the drastic Q2 decline  Fewer / flat listings across price ranges YoY, except $700K – $999K  July listings increased 13% YoY, but August flat and September down 6% YoY

600

 Soft September and seasonal trends suggest limited listing growth into year end

500

<$400K

$400K – $699K

$700K – $999K

$1M+

447 (-16%) 400

July – Sept. (YoY%)

359 (-15%) 300

23%

$1M+

-4%

'20

$700K - $999K

100

'19

'18

140

'17

140

'16

$400K - $699K

163 (+20%)

'15

-4%

'14

115

'13

110

200

'12

<$400K

249 (-10%)

'11

'10

'19

'09

'20

'08

Price Range

By Submarket

Rolling Last 12 Months (YoY%)

 Q3 showed significant variability in new listing activity across submarkets  Large number of new listings in North Elmhurst with big declines in Central West and Southeast submarkets  Most submarkets showed lower listings in August and September YoY consistent with Elmhurst overall

North

Central West

Southwest

Southeast

Central East

400

300

291 (-3%) 277 (-3%)

July – Sept. (YoY%)

217 (-12%)

200

Southwest

10%

Southeast

-31%

'20

Central East

'19

-27%

'18

'17

'16

Central West

100

'15

48%

'14

'13

'12

North

'11

'10

'19

'09

'20

'08

Submarket

188 (-21%) 164 (-14%)

COMPASS LISTINGS 546 W. Crockett Ave.

Under Contract

227 S. Sunnyside Ave.

122 E. Wilson St.

Selected Elmhurst Listings

~4,100

$1.249M

~3,500

$829K

~3,800

LIST PRICE

SQ. FT.

LIST PRICE

SQ. FT.

LIST PRICE

SQ. FT.

5 / 4.1

BEDS / BATHS

CAR GARAGE

BEDS / BATHS

CAR GARAGE

BEDS / BATHS

CAR GARAGE

682 Mary Ct.

680 Van Auken St.

253 E. North End Ave.

$1.449M

Coming Soon

$640K

~3,600

$425K

~2,550

$367K

~1,100

LIST PRICE

SQ. FT.

LIST PRICE

SQ. FT.

LIST PRICE

SQ. FT.

4/5

4/3

3/2

BEDS / BATHS

CAR GARAGE

BEDS / BATHS

CAR GARAGE

BEDS / BATHS

CAR GARAGE

LOAN TYPES

Contributed By:

30-Year Fixed

Fixed rate for 30-year term

Lower payments; predictable; afford more house

Pay more interest; slightly higher rates

Own house for a while and want lower payments

15-Year Fixed

Fixed rate for 15-year term

Lower rates; less interest paid; build equity faster

Higher payments; ties up money in your house

Own house for a while and can make higher payments

5/1 or 7/1 Adjustable

Fixed for 5 or 7 years; variable thereafter

Lower rates and payments than fixed loans initially

Payments may become unaffordable; can be difficult to refinance

Own house for a few years and want lower payments

FHA Loan

Fixed or adjustable (terms vary)

Low credit score required; minimum 3.5% down payment

Mandatory mortgage insurance; upfront and annual premiums

Lower income or lower credit and smaller down payment

VA Loan

Fixed or adjustable (terms vary)

No down payment; low rates; no minimum credit score

Funding fee; some lenders have added requirements

Veterans or activeduty personnel and their spouses

Jumbo Loan

Fixed or adjustable (terms vary)

Competitive rates; finance more than conforming limits

Higher down payments; more cash reserves; harder to qualify

More expensive homes who cannot qualify for a conforming loan 9

CONTRACTED & CLOSED By Price Range

Rolling Last 12 Months (YoY%)

 Contracted & closed homes were up 35% across price ranges; homes priced <$400K experienced the lowest increase  Contracts were up 45%+ in July and August YoY and closings increased by 75%+ in August YoY as activity surged

600

 Contracted & closed activity likely to moderate with lack of available homes

500

<$400K

$400K – $699K

$700K – $999K

$1M+

446 (+19%) 445 (+1%)

400

July – Sept. (YoY%)

300

76%

$1M+

100%

'20

$700K - $999K

125 (+24%)

100

'19

34%

'18

115

'17

154

'16

$400K - $699K

'15

'14

127

'13

133

200

'12

<$400K

257 (+33%)

'11

'10

'19

'09

'20

'08

Price Range

By Submarket

Rolling Last 12 Months (YoY%)

 Contracted & closed activity was higher across submarkets  Central West Elmhurst saw a minor increase whereas the Eastern submarkets each saw 75%+ increases

North

Central West

Southwest

Southeast

Central East

400

 Southwest Elmhurst saw the largest contracted & closed volume for the quarter and rolling last 12 months

302 (+14%) 284 (+11%)

300

July – Sept. (YoY%)

230 (+26%) 200

78%

Southwest

34%

Southeast

76%

'20

Central East

'19

'18

'17

'16

Central West

100

'15

32%

'14

'13

'12

North

'11

'10

'19

'09

'20

'08

Submarket

185 (+4%) 158 (+31%)

NEW BUILDS Permit Activity

Rolling Last 12 Months (YoY%)

 Issued 1,000+ new home permits since 2010  Permits have declined after completion of 55+ new homes at the old hospital site  New build permits appear to be stabilizing with July and August up YoY

New Home Permits Issued

Demo Permits Issued

160

 Lower construction activity as builders remain cautious around economy / pandemic

January – Aug. (YoY) 75 60 45 30 15 0

120

80 56 54

74 (-22%) 73 (-15%)

53 53 36 34 40

YTD '17

YTD '18

YTD '19 YTD '20

New Home Permits Issued Demo Permits Issued

'09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 12

HIGHLIGHTED SALE Closed in Q3 2020 â&#x20AC;&#x201C; Southwest Elmhurst

Sold By: $1,447,500 SALE PRICE

99% SALE / LIST PRICE

$356 PRICE PER SQ. FT.

5 / 4.5 BEDS / BATHS

4,060 SQ. FT.

Contemporary brick home with three-car tandem garage on quiet tree-lined street in highly sought-after Lincoln school neighborhood 13

REMODELING Permit Activity

Rolling Last 12 Months (YoY%)

 Elmhurst homes are often added to and rehabbed given a lack of open lots  Addition and remodel activity is more stable generally than new builds  Permits up modestly over last 12 months

Addition Permits Issued Interior Remodel Permits Issued 200

 Improvement activity expected to continue with more time spent at home

January – Aug. (YoY) 150

125

38 YTD '17

23 YTD '18

140 (+9%)

100

122

100 50

150

94 30

YTD '19 YTD '20

Addition Permits Issued Interior Remodel Permits Issued

50 37 (+3%) 0

'09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 14

KITCHEN TRENDS

Contributed By:

Current Trends for Your Kitchen

Custom Furniture with Integrated Appliances

Inset Cabinetry

Matching Countertop and Backsplash Quartzite Countertops Hot Water Tap Accent Cabinet Hardware Metallic Features

HOME INVENTORY By Price Range

Sept. Quarter End (YoY%)

 Available homes have declined significantly with limited new listings  Inventory is relatively consistent across price ranges (slightly higher at $1M+)  Home inventory remains at 13+ year lows

<$400K

$400K – $699K

$700K – $999K

$1M+

200

 Scarce inventory expected to continue driving “seller’s market” conditions 150

Sept. Trends (Relative%)

28%

Q3 '17

Q3 '18

Q3 '19

Q3 '20

<$400K $700K – $999K

$400K – $699K $1M+

'20

27%

'19

25%

'18

25%

'17

34%

'16

33%

'15

33%

'14

34%

63 (-35%) 51 (-35%) 38 (-25%) 33 (-48%) '13

21% 18%

'12

18% 22%

'11

25%

16% 25%

'10

50%

18% 24%

'09

75%

100

'08

100%

By Submarket

Sept. Quarter End (YoY%)

 Home inventory is down meaningfully with all submarkets down ~20% – 40%+  Southeast Elmhurst has the lowest amount of homes available and has experienced a 50% decline in inventory  Relative home inventory across submarkets approximates 2018 levels

Sept. Trends (Relative%)

Southwest

'20

'19

'18

'17

Q3 '18 Q3 '19 Q3 '20 Central West Central East

'16

North

25%

'15

Q3 '17

28%

19%

'14

24%

45 (-17%) 42 (-28%) 35 (-44%) 33 (-30%) 22 (-50%)

'13

23% 18%

22% 18% 20%

100

'12

25%

12% 20%

Central East

150

'11

24%

17% 23%

Southeast

'10

50%

14% 20% 20% 18%

Southwest

'09

75%

12% 23%

Central West

'08

100%

North

Southeast 17

INSPECTIONS

Contributed By:

Negotiating Inspections in Today’s Market  Every home has some amount of issues (it’s true!); certain issues require immediate attention while others are ongoing maintenance items  Inspection negotiations largely depend on how price negotiations went (i.e. sellers often won’t fix everything if there is a large discount to asking price or in situations with multiple strong offers)  Generally no need to forego inspections, even in the most competitive situations  Most common result from an inspection is a laundry list of items for consideration – reviewing “big ticket” items tends to be most constructive  Major items include heating and cooling, plumbing and well, electrical, roof, walls / windows / doors / ceilings / floors, appliances and foundation  Minor issues (e.g. cosmetic items) are NOT required to be fixed by the standard real estate contract; take this into account when making offers and requests  Major repairs can be costly, prone to poor workmanship and the seller and buyer have different motivations (i.e. seller wanting the work done quickly / cheaply vs. buyer wanting highest quality)  Buyer may want to request a credit or reduction to the price and hire their own contractor to facilitate repairs – this could also be the seller’s preference 18

WINNING OFFERS

Contributed By:

Strategies for Winning the House You Really Want

Make a strong offer first (i.e. donâ&#x20AC;&#x2122;t low ball) Limit contingencies (be careful on inspections). Look left to page 18 Increase the amount of earnest money

Get pre-approved for a home loan; not sure what type? See page 9 Get personal â&#x20AC;&#x201C; write a letter to the seller

Be flexible on the closing date and consider a rent-back to the seller

Work with an experienced real estate agent!

CONTRACT TIME By Price Range

Rolling Last 12 Months (YoY%)

 Days between listing date and contract signing have been low (mostly less than a month) for a few years  Homes $1M+ are more likely to be new construction versus other price ranges, which increases contract time

<$400K

$400K – $699K

$700K – $999K

$1M+

225

 Expect contract times to remain short given limited inventory and more demand 150

$700K - $999K

-30%

$1M+

70%

38 (-34%) 25 (-7%) 22 (-8%) 18 (-14%) '20

-38%

'19

'18

'17

$400K - $699K

'16

-69%

'15

'14

'13

<$400K

'12

'11

'19

'10

'20

'09

Price Range

'08

July – Sept. (YoY%)

By Submarket

Rolling Last 12 Months (YoY%)

 Contract time was around 3 weeks or less across submarkets, representing large YoY declines  Small increase in contract time for Central West Elmhurst resulted from very few days to contract last year  Homes on the market for a month or longer could be overpriced or have other factors impacting time / interest

North

Central West

Southwest

Southeast

Central East

100

July – Sept. (YoY%) 50

-25%

Southwest

-48%

Southeast

-30%

'20

Central East

'19

'18

'17

'16

Central West

24 (-11%) 24 (-8%) 23 (-4%) 21 (-16%) 21 (-13%) '15

-21%

'14

'13

'12

North

'11

'10

'19

'09

'20

'08

Submarket

PRICE DISCOUNTS By Price Range

Rolling Last 12 Months (YoY%)

 Closed sales have tightened to 96% – 97% of original list price based on increased buyer competition  Homes priced <$400K saw a narrowing discount with entry level buyers and builders paying nearly asking price

<$400K

$400K – $699K

$700K – $999K

$1M+

100%

 Price discounts expected to remain narrow given limited home availability

97% (0%) 97% (+1%) 96% (+1%) 96% (+1%)

95%

$700K - $999K

97%

98%

-1%

$1M+

96%

97%

-1%

85%

'20

'19

95%

'18

96%

'17

$400K - $699K

'16

'15

94%

'14

98%

'13

<$400K

90%

'12

'11

'19

'10

'20

'09

Price Range

'08

July – Sept. (YoY%)

By Submarket

Rolling Last 12 Months (YoY%)

 Price discounts have been mostly consistent across submarkets  Limited differences reflect appeal of Elmhurst overall as well as each submarket  Discounts tightened across submarkets, except in the Southeast (which was flat)

North

Central West

Southwest

Southeast

Central East

100%

 Buyers and sellers currently meeting at 3% – 4% less than the original asking price

97% (+1%) 96% (+2%) 96% (+1%) 96% (0%) 96% (0%)

95%

Central East

96%

95%

Southwest

97%

96%

Southeast

96%

97%

85%

'20

'19

96%

'18

98%

'17

Central West

'16

'15

96%

'14

97%

'13

North

90%

'12

'11

'19

'10

'20

'09

Submarket

'08

July – Sept. (YoY%)

PRICE PER SQ. FT. By Price Range

Rolling Last 12 Months (YoY%)

 Price per sq. ft. trend was split at ~$700K for the quarter; homes below this experienced increases and homes above showed declines  Entry level and teardowns saw the largest increases in pricing with strong competition  Homes $1M+ declined 10%+ from record levels  Relative pricing showing short-term variability with the potential to move higher

<$400K

$400K – $699K

$700K – $999K

$1M+

$350

$300

$300 (+2%)

$250

$242 (+1%) $236 (-3%) $226 (+2%)

July – Sept. (YoY%)

$241

$259

-7%

$1M+

$272

$310

-12%

$150

'20

$700K - $999K

'19

'18

$242

'17

$247

'16

$400K - $699K

$200

'15

'14

$226

'13

$239

'12

<$400K

'11

'10

'19

'09

'20

'08

Price Range

By Submarket

Rolling Last 12 Months (YoY%)

 More than half of the submarkets saw flat pricing generally; Southwest Elmhurst experienced the largest pricing decline  Southeast Elmhurst was the only submarket to show increasing prices  North Elmhurst remains on the lower end of price per sq. ft. and has been relatively stable the past few quarters

North

Central West

Southwest

Southeast

Central East

$300

$259 (+4%) $251 (-3%) $247 (+2%) $241 (+3%)

$250

July – Sept. (YoY%)

$219 (-1%)

$262

$265

-1%

Southwest

$240

$259

-7%

Southeast

$256

$242

$150

'20

Central East

'19

-1%

'18

$266

'17

$263

'16

Central West

'15

'14

$220

'13

$219

'12

North

$200

'11

'10

'19

'09

'20

'08

Submarket

CLOSED SALE PRICES By Submarket

Rolling Last 12 Months (YoY%)

 Overall sale prices were mostly higher, led by a large increase in Central East  Southwest sales prices approaching double those in 2012 – 2013 due to new construction  Southeast saw lower prices despite higher price per sq. ft. due to smaller home sales

$700K

 Limited homes available and new / updated homes expected to push prices higher

$600K

North

Central West

Southwest

Southeast

Central East

$500K

July – Sept. (YoY%)

$556 K (+12%) $550 K (+2%) $540K (+2%) $475K (0%)

$400K '20

'19

North

$360K

$343K

Central West

$630K

$540K

17%

Central East

$630K

$450K

40%

Southwest

$585K

$505K

16%

Southeast

$445K

$496K

-10%

$351K (-5%) $300K $200K $100K

'08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20

Submarket

STAYING CLOSE TO HOME Thanks to Our Contributors

Themis Katris Managing Partner 257 West Avenue, Suite 206 Elmhurst, IL 60126 708.351.1199 tk@katrislaw.com

Michelle Polay Owner 378 N. York Road Elmhurst, IL 60126 630.833.2331 michelle@polayinteriors.com

Bob Fornatto Sr. Loan Consultant, NMLS #755947 150 E. Butterfield Road, 2nd Floor Elmhurst, IL 60126 630.598.2348 bfornatto@wintrustmortgage.com

Special thanks to e2Photography for providing the cover photo. Image is copyrighted. www.e2photo.net/

Organizations We Supported in 2020

Elmhurst-Yorkfield Food Pantry

www.compass.com

Compass is a licensed real estate broker and abides by federal, state and local equal housing opportunity laws. All material presented herein is intended for informational purposes only, is compiled from sources deemed reliable but is subject to errors, omissions, and changes without notice. Sources include Midwest Real Estate Data LLC and the Elmhurst Community Development department. This is not intended to solicit property already listed.

Elmhurst Office 103 Haven Road Elmhurst, IL 60126 630.750.9551 kelly.stetler@compass.com www.kellystetlerrealestate.com