Selling the lifestyle that comes with purchasing a home in the suburbs is as important as promoting the look, functionality and features of the property itself. Carefully listening to buyers describe the way of life they envision for themselves — a short commute to work, walkability to good schools, fantastic shopping and scenic parks — enables real estate professionals to use the overall picture they paint as a road map to finding the area that is right for their clients.
In the north, west and south suburbs, many municipalities are upping the walkability ante by creating downtown shopping districts in close proximity to residential areas and public transportation. Giving the suburbs a mini-city appearance, these downtowns feature locally owned restaurants and retail establishments resembling those found in Chicago’s neighborhoods, easing the transition to a new way of living for transplants from the city.
As ambassadors to the suburbs, real estate professionals who specialize in areas outside the city limits don’t have a difficult time explaining the value proposition of laying down roots in suburbia. Among the factors that make the suburbs attractive to buyers are a lack of congestion, homes on larger lots with backyards and garages, good schools, reliable public transportation, and easy access to major thoroughfares. Hear what local experts have to say about home values, who’s buying properties in their markets and why now is a good time for buyers and sellers to make a move.
Walking the walk
Susan Maman, a luxury broker with @properties in Winnetka, has lived in the same area her entire life. A tireless promoter of Chicago’s North Shore communities, she’s a true believer in the region’s suitability as a great place to raise a family. This image, a copy of the cover of the Glencoe News from 1965, features Maman at around age 5, seated on the floor of the local library reading a book. She will sometimes use the photo in her marketing to show her loyalty to the close-knit community on the shores of Lake Michigan. Image courtesy of Susan Maman.
Some of the most successful ambassadors are the agents and brokers who know their suburban communities like the back of their hands. Promoting the North Shore is easy for Susan Maman, a luxury broker with @properties. She grew up in Glencoe, raised a family there and still resides in the idyllic, close-knit community nestled along Lake Michigan. “Once families are settled in, they rarely leave,” Maman said of her hometown — unless it’s for a job transfer, divorce or other major life change. “They move within the community.”
Approaching her 60s, Maman still keeps handy a photo from the cover of the Glencoe News featuring herself at about age 5, sitting on the floor at the local library reading a book (see page 14). Occasionally, she uses it in advertisements to market herself as a local expert.
Like Maman, Ed Pluchar, a top-producing real estate agent with Real People Realty in Mokena, grew up in the area he promotes: the south suburbs. Things there have certainly changed over the years, and he has witnessed a lot of farmland become residential neighborhoods. “People have mixed feelings about it, but that is the way things go,” Pluchar said. However, in the redevelopment he’s witnessing of downtown areas, such as Frankfort, he sees building trends that reflect nostalgia for a quaint, small-town feel that also mirrors the needs of today’s young families. “Amenities like mom-and-pop shops and local-style restaurants — not national brands — are opening in these towns,” he said.
As intimately as suburban real estate professionals might know an area, it’s important to identify methods for clients who are moving to the suburbs to get a sense of community living. Maman noted most North Shore towns have welcome clubs for newcomers that host events to help neighbors become acquainted with each other and community centers that offer activities for all ages.
A softening market?
As home prices have slowed their climb across the country, many real estate professionals in Chicago’s suburbs are watching for the “fundamental repricing in the high-end marketplace” that Baird & Warner CEO Steve Baird warned North Shore brokers about this February.
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Case study: What to do when a big HQ leaves town
Examining impediments to growth in the ’burbs
As vice chairman of Midwest Real Estate Data, treasurer of the Broker Public Portal and advocate for the Homesnap app, Paul Wells is all about the numbers. The broker-owner of RE/MAX in Barrington noted that home values have stabilized since the recession; the average price of a home in his area in 2008 was $242,000; now it’s back up to $243,500.
But still, Wells noted that the economic crisis looms large for some, and that impacts the draw of more expansive suburban lots. Buyers still reeling from the Great Recession are taking on the mindset of “less is more,” Wells said. “A smaller house means lower property taxes, maintenance and utility costs. People are cutting back and putting themselves in a position to have a better lifestyle by spending less money.” To accommodate the market, he said prices of high-end properties are being reduced.
Bullish on entry-level homes
While Wells characterized the situation as a buyer’s market for high-end properties, he said it’s still a seller’s market for mid- and low-priced homes. That’s because while inventory is increasing in the upper-price ranges, it’s still very low in the mid to low range. Wells identified the reason for this teeter-totter as low interest rates making it more affordable for people to buy their first homes, which means average-priced houses are getting snatched up quickly.
But Wells noted that pricing can vary quite a bit from suburb to suburb. While the Barrington market is healthy, sales in the surrounding northwest and far northwest suburbs Wells serves are even stronger, because the average sales price of homes is lower: “Houses in Barrington priced at $400,000 are hot; in Palatine, $300,000 homes fly off the shelf,” he said.
Recently, Pluchar has heard colleagues talking about prices softening in his territory. But he agreed with Wells in that he’s not seeing a softening in entry-level homes, which is a huge category for him, thanks to technology. His large online presence brings him face-to-face with millennials who are entering the market in large numbers and who generally begin their home searches online.
Suburban demographics
Millennials represent the largest generational share of recent homebuyers at 37 percent, according to the National Association of Realtors’ 2019 Home Buyers and Sellers Generational Trends Report. What’s more, they are taking up residency in areas that offer them affordable homes and a short commute to work. According to NAR, 30 percent of millennials purchased homes for $300,000 on up in 2018, an indicator that they favor affordability. That’s why Pluchar is so excited about serving this demographic; the new south suburban listings for single-family homes on his website range from the mid-$200,000s to around $420,000.
“Millennials are coming home from living in the city and out of state,” Pluchar said. “They are coming back to where their families raised them and where their families are still living.” He finds it interesting that the reality of high taxes and the threat of even higher taxes does not deter them.
Maman is also seeing an influx of young parents, many transplants from the city, who are motivated by the convenience of living in the suburbs. But in addition to young families, Maman has been assisting a lot of move-up and move-down buyers, older adults in their 60s through early 80s who want a ranch — a style especially plentiful in suburbs that were built out in the middle of the last century — or a home with a first-floor master or elevator, both features that are more common in the new-construction market.
And it’s not just the North Shore that’s attracting this demographic. Pluchar also often assists downsizing baby boomers, who are opting for entry-level homes in the area to be close to their children.
Features that draw buyers out
Aside from being near family, schools are a major draw for those moving to the suburbs. In particular, Maman called out the education system as an important reason homebuyers choose the North Shore, and it’s not just resources and low class sizes. She said children in Glencoe build lasting bonds with each other because they move up in school together, from kindergarten through eighth grade, before heading to New Trier Township High School where they take classes for the first time with students from a variety of feeder schools. It’s a special experience, said Maman, who still keeps in touch with her own grade-school friends. Maman often proudly shares this with potential buyers, along with the fact that New Trier placed 15th on the 2019 U.S. News & World Report’s Best High Schools in Illinois list.
Maman looks back on the Glencoe of her youth and realizes that as much as times have changed — kids have more homework, more extracurricular activities and less free time to explore the town after school than she did — the community has stayed true to its roots. Aside from good schools, local attractions include the Chicago Botanic Garden, Writers Theatre and Ravinia Festival. “Second and third generations live in these communities,” said Maman. “It’s an indication of people’s love for them.”
When working with buyers who are new to the south suburbs, Pluchar also often points out the good schools. But he’s also sure to mention the beautiful parks, miles of nature trails and family-friendly atmosphere that places a big emphasis on youth sports. And now that summer is heating up, he also has the opportunity to point to seasonal festivities like farmers markets, classic car shows, summer movies in the park and Fourth of July parades that truly make the area special.
Wells said Barrington is known for its breathtaking equestrian trails, philanthropy-minded residents, rolling estates, desirable schools and fanciful downtown shopping district, complete with a Metra station for getting to and from the city with ease.
Growing desire for accessibility
Speaking of Metra, it’s becoming more and more important for agents in the suburbs to understand the many ways buyers can get around. Make sure you know the train stops, Pace routes and bike trails that might make your clients’ commutes and mobility options more flexible. And while it’s hard to measure how this impacts home values — the National Association of Realtors’ most recent estimate is that the “transit premium” on residential property can range from an increase of a few percent points to over 150 percent — it’s unlikely having this kind of access will be unwelcome in the resale equation.
Maman said that on the North Shore, just about every town has its own train station that takes residents to work in the city in less than half an hour. For those who prefer to drive, Highway 41 turns into Interstate 90, a quick link to the city and all the North Shore suburbs along the lake.
Highway development can also spur residential growth. Although it has been 10 years since Interstate 355 was extended south, Pluchar said the extension, which gives residents easy access to work in the city as well as the northern suburbs, is still bearing developmental fruit. He added that not having to take back roads to access the highway has shaved off 30 minutes from the time it takes him to reach the North Shore. And the area is still developing around this relatively newfound mobility. Pluchar noted that since Silver Cross Hospital arrived in New Lenox in 2012, a great deal of residential growth has taken place and industrial and commercial developments are being built on spec in anticipation of businesses moving to the area. “There is a lot of land and a lot of factors playing into the whole area growing and developing in a prosperous way,” he said. “It’s sort of the fresh start of Chicagoland.”
More bang for the buck
Making the case for homeownership in general is easier for agents who are able to contextualize the fact that interest rates are still very low by historical standards. Wells said he often imagines his grandchildren not believing him when he tells them about the time interest rates were at 4 percent. “Rates are the driver in this market,” he said. “Money is still on sale. It won’t last forever. If people are not taking advantage of it, it is a demise of their own making.”
But sometimes a suburb’s reputation can get in the way of local agents trying to explain the local market to outsiders. Wells said he often sees buyers overlooking the extraordinary values in Barrington right now because of its reputation for high-end homes. In reality, the range is quite wide in terms of prices; buyers can find homes in Barrington priced from $100,000 to $5 million. “Some people are getting absolute steals,” he said. “It’s one of the best times I’ve seen in 32 years to buy a home in Barrington.”
Making the case for purchasing a home in the south suburbs, Pluchar said in much of his territory — particularly towns such as Frankfort, Mokena, New Lenox, Joliet and Plainfield — a buyer can purchase a very nice single-family home with a decent backyard for the price of a one-bedroom condo in the city. As buyers move north into more densely populated areas, though, prices start to climb. “When people are tired of paying those high prices, they migrate south for the same house for less money and maybe a little bit of land,” Pluchar said.
Pluchar estimates the south suburban market will be warm, if not hot, for quite a while and anticipates it will increase in popularity over time. And even though the North Shore may not be destined to see the massive year-over-year increases in price in the near future, Maman thinks there will always be an important place for the suburbs in the Chicagoland real estate market. “You are buying a lifestyle,” she said. “With the exception of lakefront property, living in the suburbs is still more affordable than the city.”