Investors buying up properties with wads of cash. Outsized loans for palatial spreads. Open houses drawing twenty buyers to the first showing, and bidding wars galore. With average time on market down 25 percent and inventory shrinking 31 percent from this time last year, it’s clear that the real estate rush is on. No wonder — buyers chilled by the recession now face a ticking clock. A 30-year fixed-rate mortgage was 4.59 percent at the end of July, up from 3.74 percent before Memorial Day. This week, Grid profiles five buyers who have waded into a market that’s shifted rapidly in the last 18 months, describing their challenges and pairing them with professionals.
The empty nesters: John Battin, 75, a retired Motorola executive, and Angie Battin, 59, who used to work in accounting.
Real estate agent: Judy Gibbons, Judy Gibbons Properties/Hunter’s Fairway/Sotheby’s International
Price range: $400,000-$600,000
Requirements: A 2,500-3,000-square-foot with a first-floor master bedroom and common grounds to reduce the labor required for upkeep.
With their three children grown, the Battins want to downsize. But their 7,500-square-foot house in North Barrington has been on the market for about a year, with no offers. Although they’ve looked at about 60 places, they’re reluctant to settle on one until they can sell their current home.
And they’re still very attached to the house they live in, with its sunset views over Honey Lake and four acres that include Angie’s carefully tended gardens. “We have a screened-in porch that looks into the woods, with a rope chair that’s very comfortable,” John says. “That’s probably my favorite place. You sit out there in the evenings and hear the water in the creek, and it’s just fabulous.”
Real estate agent advice
Gibbons suggests the Battins consider dropping the $975,000 asking price on their home and search for a new house in earnest. Despite the overall rise in housing prices, properties near the $1 million mark still aren’t appreciating much, she says. On the other hand, the kind of ranch house that the Battins want are a hot commodity, due in large part to increasing demand from aging Baby Boomers like themselves. Gibbons advises her clients to think less about scoring a financial windfall on the sale and more about the quality-of-life improvements they would gain from owning a house that’d be easier to maintain.
“Our homes are not these huge investment vehicles anymore, but you have to live somewhere,” Gibbons says. With lower electricity, heating and landscaping bills for a smaller house, she adds, “if you look at the total payment per month, you are winning.” John estimates that he spends $5,000 to $7,000 a year hiring people to do outside maintenance, and that’s with he and Angie shouldering much of the burden themselves. He mows the lawn, and she does most of the garden upkeep.
John checks the real-estate listings every day, but he says he can’t bear to see the houses in person without knowing when his own home will sell. “We’ve fallen in love with about half a dozen places, but it seems as if all the ones we like the most are only on the market a few weeks,” he says. “It’s an emotional roller coaster.”
He and Angie have considered moving forward and, if necessary, owning two houses for a while, but he says it’s too expensive. Meanwhile, the kids are encouraging the Battins not to lower the price on their current home. “I don’t think there’s anything selfish about it,” says John, “but they don’t want to see us give up so much of an asset.”
This week, Grid profiles five buyers who have waded into a market that’s shifted rapidly in the last 18 months, describing their challenges and pairing them with professionals.
Monday: The rookies
Tuesday: The empty nesters
Wednesday: The nest-builders
Thursday: The bargain hunter
Friday: The bidding warriors
Photo by Heath Sharp