Pandemic, wintertime and lingering effects of last decade’s housing crisis contribute to extreme McHenry County seller’s market

Dawn Bremer, a real estate agent and owner of the Bremer Team of Keller Williams firm in McHenry, said her business is making cold-calls to homeowners based on when they bought their properties and asking if they want to cash in on one of the strongest seller’s markets in memory.

It is one of the only effective strategies to discover potential purchases for prospective home buyers right now, she said, with demand far outweighing the present supply of residential products for sale in McHenry County due to the fallout of of the COVID-19 pandemic combined with normal winter seasonal slowdowns.

Homeowners who bought low as the Great Recession shook out and banks foreclosed on homes in the area are especially being targeted, as they likely have paid off enough of their properties by now to sell at decent, and perhaps significant, profits in today’s market, Bremer said.

“Agents are calling people based on the amount of their equity and the time they bought their house and asking if they are interested in selling,” Bremer said. “We are trying to find homes for our buyers.”

The number of closed sales for December was 37.4% higher than the year before while the amount of inventory was 61.8% less, according to year-over-year monthly statistics published by the Heartland Realtor Organization.

“December is normally one of the slowest months of the year but strong buyer demand across most segments of the market, buoyed by near-record low interest rates, continue to drive a healthy sales pace in the face of a new wave of COVID-19 infections and a softening jobs market,” the Heartland report advised.

Plus, reductions in new housing construction in the area since the home mortgage crisis is playing a role in shooting prices back up closer to their levels from before the Great Recession, even as the pace of building has picked up recently, said Jorel Kilcullen, a Marengo-based real estate agent serving McHenry County.

“It’s gotten markedly more difficult to find first-time buyers a home in the past six months,” Kilcullen said. “We’re going to see reduced inventory levels every year from October into about spring time. Slightly overpriced, slightly outdated, got passed over in the fall, those kind of properties would generally sell this time of year when nothing else is available. Those homes already sold in the fall is what we’re experiencing now.”

As the coronavirus has confined people to their dwellings and working from home becomes a more permanent habit for many professionals, demand for residential real estate has surged, with renters and owners of condos, townhomes or small single-family units motivated to upgrade into homes with more space for offices and outdoor yards.

“The pandemic is creating anything but a housing crisis. The housing market is stronger than ever,” Kilcullen said.

The only way to soften the market, he said, is to add substantially more inventory. “I just want to see rooftops going up,” he said.

Area real estate agents interviewed for this story expect to see more listings come online as the year progresses and the pandemic gets controlled by vaccination efforts.

But in the meantime, the homes that are listed are likely to see quick turnarounds.

“I had one that I just listed on Tuesday night, and by the end of Wednesday morning, I had eight showings scheduled,” said Paul Dimmick, a real estate agent with @properties who serves McHenry County. He added that he sold a home in Fox River Grove on South River Road in less than 24 hours after it became for sale.

“The market will continue on with low inventory and high demand, and the scales will start to balance as the demand starts to dwindle. Demand exhausts itself at some point,” Dimmick said. “I’m thinking 2022 and into 2023, things are going to cool down a bit.”