The St. Patrick's Day Crowd

Current Market Conditions

This past weekend Chicago did what Chicago does best, it celebrated St. Patrick’s Day.

What’s more Chicago than that?

I grew up in the southwest suburbs, and most of my family is from the South Side. In those parts you’re either Irish or Polish. My family falls on the Irish side (our last name was originally something like O’Larecy at some point), so to put it mildly, St. Patrick’s Day has always been a big deal.

We loved celebrating it. And from the time I was about 16 on… we may have had a little too much fun with it.

Every year it felt like we had to find or throw a bigger and better party.

You know the drill. Wake up at the crack of dawn. Grab some green beer. Start the pregame. Head downtown to watch the river get dyed green. Then go out like there’s no tomorrow.

For a long time, I lived for that day.

It was chaos.

I remember one year my wife Nicole, who was my girlfriend at the time, decided to come along. A buddy of mine had rented out the top floor of Gibson’s, so after watching the river get dyed we headed over there.

Nothing beats a mini burger at Gibson’s while celebrating St. Patrick’s Day.

At first it was great. We were mingling, talking with people, catching up with friends. But as the afternoon went on, it got harder and harder to actually have a conversation with anyone. Most people were about four drinks past where they should’ve been.

Then the Shannon Rovers Irish Pipe Band came marching in.

If you’ve ever seen them on St. Patrick’s Day, you know the scene. The place erupted. People were cheering, drinks were flying everywhere, and in the chaos someone bumped into Nicole and spilled a full beer down her back.

She just stood there for a second, soaked, looking completely miserable.

I looked at her and said, “You want to get out of here?”

I don’t think I’ve ever seen someone say yes faster.

Twenty minutes later we were in a cab heading back to my parents’ house. We ordered some Baracco’s pizza, turned on Million Dollar Listing, and just sat there in sweatpants.

And honestly… it ended up being one of the better St. Patrick’s Days I can remember.

For years I thought the best place to be on St. Patrick’s Day was wherever the biggest crowd was.

Turns out, sometimes the best moment is when you step away from the crowd.

And oddly enough, that reminds me a lot of what happens with sellers in the housing market.

We’re quickly approaching spring break, which is when many sellers think the “perfect” time to list their home is.

A lot of sellers assume nobody is really looking in January or February, so they plan to list right after spring break when they feel the market is fully underway.

Others spend the first few months of the year getting their homes ready, coming out of the holidays, using the slower winter months to prepare for what they think will be the spring rush.

And many families with kids are working around school schedules, trying to line up a sale so they can move closer to summer break.

So naturally, many sellers land on the same conclusion:

“Let’s list after spring break.”

The interesting thing is that when everyone waits for the same moment, they all end up competing with each other.

Right now inventory is still very low and demand is very strong. Many buyers are still losing out on homes because there simply isn’t enough inventory.

Once we get past spring break, we’ll likely see a wave of new listings hit the market, which means sellers will start competing with each other a lot more than they are today.

That doesn’t mean it’s a bad time to sell, it just means the landscape starts to change once more inventory hits.

Just like St. Patrick’s Day, everyone thinks the party starts at the same time.

But sometimes the best place to be… is the one that filled up before everyone else arrived.

 

Demand was strong this week. It slowed a bit over the weekend with the river dyeing, but we’re still firmly in peak demand season.

Listings were down slightly this week, likely because some sellers held off with the weekend festivities. We are still right in the thick of prime listing season.

Rates were up a tad this week.

Contract were up this week, which is typical this time of year since we’re in prime time.

Multiple offer are getting wild right now. A big driver is buyers nearing the end of their leases.

The downtown high rise market is seeing buyers be very price conscious right now.

Buyer fatigue is starting to show. Some buyers who began their search earlier this year are starting to feel worn down by the competition, while new buyers continue to enter the market.

Sellers are testing pricing. Some are pushing higher price points because of the strong market. Well-priced homes are still moving quickly, but buyers are quick to push back if something is priced too aggressively.

Leasebacks are becoming more common. We are starting to see more sellers request leasebacks as they try to line up their next move.

Spring Break. Watch for a large wave of inventory after Spring Break.

Single Family Homes 

Not much has changed here from last week. The entry-level price point is absolutely insane right now. Inventory is extremely low and there are a lot of buyers trying to get into a house before their leases expire. As a result, the offers we’ve seen this week have been pretty wild. There may be some light at the end of the tunnel. Historically, we see the largest wave of single-family inventory hit right after Spring Break, so that will be something to watch closely. The luxury sector is also performing well, but the homes need to show well. Buyers right now are very hesitant to take on properties that need work. Overall, this remains a very strong seller’s market.

Lincoln Park, Lakeview, North Center, Roscoe Village

Again, not a big change from last week. This area is still crazy. We’re in one of the final pushes for buyers with April and May lease expirations, and you can really see the pressure in their offers, especially in the entry-level price range. Some of the offers coming in are honestly jaw-dropping. Inventory is still extremely low, particularly for duplex downs and townhouses. When those hit the market right now, they tend to get swallowed up almost immediately. The big thing to watch will be after Spring Break. That’s typically when we see more inventory hit, and it will go a long way in determining how competitive the spring and summer markets will be. For now, this remains a very strong seller’s market.

West Town, Wicker Park, Bucktown, Logan Square, Avondale

Same as above.

West Loop

Demand continues to rise in the West Loop. Entry-level, move-in ready properties are doing well. We’re also starting to see buyers who get outbid in West Town take a look at the West Loop because it’s actually more affordable, which is kind of crazy to say. Show-stopper luxury properties are also performing well. Where things slow down is the mid-tier market, especially when the units are dated. Overall, this remains a balanced market.

Old Town

Another week, another hot Old Town market. Old Town is one of the few areas where I’m seeing high-rises perform very well right now. Walk-ups remain the hottest product here by far. Townhomes also move quickly when they come up, mostly because they’re so few and far between. Overall, this remains a strong seller’s market.

South Loop

The South Loop saw a small bump in demand this week, particularly in the entry-level market. A lot of those buyers have April or May leases coming due, so activity is starting to pick up. The mid-tier market, especially units with dated finishes, is still sitting. If it’s a luxury property with over-the-top upgrades and a jaw-dropping view priced below market, it will sell. Overall, this remains a buyer’s market.

New East Side & The Loop

We’re starting to see some good action here, even a few multiple-offer situations in the entry-level market. But it has to be priced well and have all the bells and whistles. The mid-tier market has also picked up a bit, again, if it has solid upgrades and is priced right. Show-stopper luxury properties priced below market are selling. If a property is overpriced or dated, it’s going to sit. It’s still a tough market here, but things have definitely been improving. Overall, this remains a buyer’s market.

River North, Streeterville, Gold Coast

We’re seeing a nice bump in activity this week. Entry-level properties with good finishes that are priced well are selling, which is good to see. The mid-tier market is also moving if the property has solid upgrades and is priced right. High-end, show-stopper luxury properties priced below market (and they really do have to be below) are also selling. If something is even slightly overpriced or has dated finishes, it’s going to sit. Buyers in this area are extremely price conscious. Overall, this is still a buyer’s market, but it feels like it could move toward a balanced market soon.

The Big Picture:

• Outskirts: It remains a seller’s market across all categories, 

• Downtown Core: Is a buyer’s market.