By Jeff Lasky, CEO, North Shore-Barrington Association of REALTORS® (NSBAR)
If the past year has proven anything, it is this eternal truism about real estate: There’s always a market.
Looking back now with some perspective — despite our initial trepidation, with a global pandemic raging and remaking every aspect of our personal and professional lives — the dynamic world of residential real estate prospered and evolved in new and surprising ways. While we watched as other business sectors faltered in this uncertain climate — including the commercial real estate sector — a surprising and almost counterintuitive thing happened along the way: home sales ramped up and never slowed down.
This turned our concepts of a “traditional selling season” on their heads and transformed classic sales patterns into a fast-paced, unending yearlong sprint. Buyer demand over the past 12 months has reached white-hot levels, creating an epic “seller’s market” whipped by low inventory, historically low interest rates and exceptionally high demand.
Once real estate was deemed by Illinois Governor Pritzker as an “essential business,” resilient REALTORS® collectively drew their breath, pivoted and just plain got to work… and have remained steadily busy ever since. When challenged, this is an industry that is always at its most agile.
Our business survival demanded new tools for these new times — not merely as a matter of convenience, but more importantly, one of personal safety and even survival. We needed to stay connected while remaining apart by physical and social distancing. A massive paradigm shift driven by intense consumer pressure for ever-more “contactless” services transformed every corner of our society, and real estate was no exception.
Technology platforms long thought of as “novelties” by some in our business took center stage, playing a crucial role. FaceTime, Zoom, digital document management, multimedia marketing and more were quickly and almost universally adopted by real estate practitioners not only to maintain the flow of their businesses — and assure crucial safety for their clients — but, in many ways, to help augment and showcase the professional facilitation skills and negotiation capabilities of the broker.
REALTORS® also discovered new ways to add value to the transaction. REALTORS® were empowered by these evolving circumstances (and enhanced by technology) to demonstrate their benefit to clients like never before — with the bulk of consumers opting for familiar and trustworthy professionals while engaging in real estate transactions during this uncertain moment.
Among the factors driving intense consumer demand, was the fact that the very concept of “home” was itself being transformed — as traditional work/life boundaries became blurred as never before. As offices were shuttered and people were constrained by the necessity of complying with “stay at home” mandates — the residence was required to meet evermore needs as a place to work, live and play. Overnight, our homes became our offices, our gyms, our bars and restaurants, and our learning centers. After just a few weeks of home-schooling, many families with children, in particular, were acutely aware that “more space” was not just a nicety, but a downright necessity!
REALTORS® responded to this “next normal” as consumers started looking for more expansive, feature-laden homes with large tracts of land and more open spaces — as opposed to confining themselves to residing in more constrained settings. Suburban markets, like many that our NSBAR membership serves, found themselves booming. One area that saw particular gains was the affluent market — individuals and families blessed with wealth, and the existing capabilities for the flexibility of remote work.
Representing many of the region’s historically affluent enclaves along Chicago’s North Shore — as well as the Barringtons and our northwest suburban marketspace — NSBAR members conducted over one-third of all home sale transactions valued at over a million dollars across the MRED landscape. Winnetka, Lake Forest and Wilmette ranked among MRED’s top five markets by both sales volume and units sold in the million-dollar-plus category over the past year (April 1, 2020, through March 31, 2021).
NSBAR members found that luxury buyers were interested in homes that offered plenty of room beyond the main living areas, and features that would contribute to the safety and overall comfort of the sequestered family “pod” — with plenty of roomy options for the occupants to spread out within the home itself. Additionally, we found that many of these buyers were looking for the safe-haven long-term investment that real estate has traditionally represented as a response to market volatility and an uncertain economic environment.
The NSBAR Luxury Council was initiated to advise on the creation of programming, events and resources that assist our members in providing the highest level of service to their luxury clientele, and to institute a forum for the vibrant exchange of ideas and best practices among real estate professionals. We seek to mentor those considering entry to this challenging market niche and, for more established practitioners, offer the opportunity to network among their peers and win a greater share of luxury home sales.
The trends that we are seeing are occurring at such velocity and ferocity right now that it is difficult to predict with any certainty what lies ahead. There are clearly more questions than answers, and perhaps only time will tell what exists for us in a post-pandemic world. One thing that we know for sure is that there is ALWAYS a market — and as REALTORS® we must prepare for whatever that future holds for us and for our clients.