ChiBLOGo, Illinois

Going Away

2010-04-08T17:21:00.002-05:00

For future blog updates, visit my newest blog at http://outandaboutchicago.tumblr.com/!

Turns Out It WASN'T Your Last Chance for $8000... or $6500!

2009-11-06T13:09:00.004-06:00

Just today, President Obama signed into law a new unemployment insurance bill, which includes an amendment to the First Time Homebuyer Tax Credit. The new law includes the following exciting changes that now even affect buyers who have already owned a home:

The tax credit has been expanded to include homebuyers who are selling a home that they've lived in as a primary residence for 5 consecutive years of the past 8 years (repeat buyers)
Repeat buyers are now eligible for up to $6500
The new deadline for the credit is April 30, 2010 (instead of Nov 30, 2009). This deadline will now apply to all sales with binding contracts signed by this date - not just properties that have actually closed by this date. This means that if you plan to close by April 30 and the closing gets pushed back a few days, you may still qualify for the credit since you already have a binding contract.
First time homebuyers are still eligible for up to $8000
Income limits have been increased to $125,000 for single filers and $225,000 for married filers
The maximum home purchase price to be eligible for the credit is $800,000

Some FAQ about this credit:

Q: I am a "repeat buyer". Must the new house that I purchase cost more than the old house I sold?

A: No, repeat buyers also include those who are "downsizing", or spending less on the purchase than they got on the sale.

Q: I owned and lived in my home for 10 years. 2 years ago I sold it and have been renting. If I buy a home before April 30, 2010, will I still be eligible for the $6500 (assuming I meet all other criteria)?

A: Yes. You owned and lived in your home for 5 consecutive years of the last 8 years so you qualify as a repeat buyer in that respect.

Q: I am purchasing a home for $815,000. Am I still eligible for at least a portion of the $6500 repeat buyer credit (assuming I meet all other criteria)?

A: No. The credit limits the purchase price at $800,000. This is a hard maximum (not a phase-out), so any purchases above $800,000 will disqualify you from claiming this credit.

As always, please consult your tax professional to discuss your eligibility for either of these credits and your particular situation. Do not hesitate to contact me if you'd like to discuss the possibility of buying or selling property in time to claim this credit. I'd be happy to discuss your situation with you or refer you to a great agent in your area!

$8000 Tax Credit Explained

2009-10-22T07:55:00.003-05:00

I wish I'd found this video sooner. It explains the tax credit really clearly. We have about a week and a half left for anyone wanting to make the plunge in time to claim the credit! So there's still time if you're ready to move quickly. http://www.blip.tv/file/2724367

Your last chance to qualify for $8,000!

2009-10-05T13:29:00.009-05:00

On Wednesday, Oct 14 at 7:00PM, Wells Fargo & Coldwell Banker will be hosting a webinar for potential homebuyers to learn about financing options, 3.5% down payment loans, buying foreclosures, tax incentives, and more!

This is also a LAST CHANCE opportunity for first time homebuyers to learn about the $8,000 Homebuyer Tax Credit! This credit expires on November 30, 2009 so don’t miss this informational presentation!

You may attend our webinar from the comfort of your home!

Topics Covered:

· $8,000 First Time Homebuyer Tax Credit

· 3.5% Down payment loans and other financing options

· Benefits of owning property, such as tax deductions and property appreciation

· Buying foreclosures and short sales

· How YOU can benefit from current market conditions

· Why NOW is the ideal market for first time buyers

· … and MUCH MORE!

After registering, detailed instructions will be emailed to you.

$8000 FOR YOUR DOWNPAYMENT

2009-06-02T16:40:00.005-05:00

I apologize for the blogging hiatus. Terry - I also apologize personally to you. I know you were very sick of looking at the giraffe print house every day in hopes that I'd have a new blog update. I will say that I think my blogging frequency is directly related to the condition of the real estate market - the busier I am, the less time I have to blog!

However, I am back on track...

This update is really important so I wanted to make sure I got this posted ASAP.

The news is related to the $8000 First Time Homebuyer Tax Credit. Originally, you'd have to close on the property before you could fill out the tax form and receive the tax credit. This meant that you could not use it directly toward your downpayment.

The new guidelines - which are still being developed - say that you can use the $8000 tax credit for your downpayment on FHA loans. FHA loans allow you to put down a minimum of 3.5% downpayment.

How would this work? The $8000 would be lent to you as an advance - so that you could use it at the closing table. It would come from certain eligible lending agencies - not from the IRS. This $8000 advance would act as a loan that you then repay from the $8000 tax credit you'd receive from the IRS when you file for it after closing.

If you bought a $200,000 home with an FHA loan, your minimum downpayment would be $7,000 which would be more than covered if you qualify for the $8000 tax credit. This means NO OUT OF POCKET COSTS TO COVER YOUR DOWNPAYMENT. This is only good through the end of November of 2009 so WHY WAIT? Even if you have to break a lease to buy a home, why not consider it - what's cheaper - breaking your lease, or losing out on $8000? You may even be able to get a seller to buy out your lease in this market filled with motivated sellers.

Honestly, I can't imagine that it's going to get better than this. When they announed that the previous $7500 credit was increased to $8000 and didn't have to be repaid anymore, we thought it was too good to be true. NOW, you can use that $8000 directly at the closing table and you might not even have to come up with a downpayment.

Terry

Animal prints are so last year...

2009-04-02T10:53:00.002-05:00

Just found this up north... I am speechless.

First Time Homebuyer Info

2009-03-19T21:31:00.005-05:00

So, I've told you about the new $8000 "Obama money" for first time homebuyers. But how exactly do you get it? It doesn't just magically appear in your bank account. And how do you know if you qualify?

Come to our info session Tuesday March 24 from 6-7PM to learn more! You'll also meet a lender who can tell you about 3.5% downpayment Federal loans, and you'll hear from a real estate attorney who can answer all of your questions.

Not only will we cover the $8000 tax credit, but I can tell you all about how to find a deal with foreclosures & short sales, and MUCH MORE.

Date: Tues 3/24

Time: 6-7PM

Location: 1840 N Clark, Chicago

Why: Because you want $8000 in free cash. And because we'll give you free food.

RSVP to me! (773) 467-5345 or eileen.mcauslan@cbexchange.com

FHA Financing - First Steps!

2009-03-16T17:19:00.006-05:00

Federal Housing Administration (FHA) loans are the next big thing in real estate financing. The reason? These are the only low downpayment loans that have survived the turmoil of the lending world. First time buyers are particularly fond of these since they require only 3.5% downpayment. For that, you pay a slight premium usually in the form of a slightly higher interest rate, but for some buyers this type of loan is the only option.

The issue we run into with FHA loans is that the property has to actually qualify for the loan. This gets troublesome at times, especially in the condo world.

If you're going to be getting an FHA loan and you're interested in buying a condo, you have two options:

Only look at condo buildings that are fully FHA approved
Only look at condos that might qualify for FHA spot approval

The building management company can usually tell you if the building is FHA approved, or you can search online for approved buildings at https://entp.hud.gov/idapp/html/condlook.cfm.

If the building is not FHA approved, there are a number of criteria the condo itself must meet in order to get a spot approval on the individual unit. Without going through the entire spot approval process, you should start by finding out:

1) Does the condo association hold the Right of First Refusal? If they do, this condo will not be able to get an FHA spot approval. Skip it. On the flip side, if you're trying to sell your condo in a building that has the first right of refusal, you might consider talking to the association to see if they can change this rule in the condo by-laws. This might open the market for you and draw a larger buyer pool to your condo. But do this right away - because changing the by-laws might require getting past some red tape and take a little time.

2) What percentage of the condos in the building are owner-occupied versus rented? The building must be at least 71% owner occupied in order to be considered for an FHA spot approval. So if you're interested in a building full of renters and you're getting an FHA loan, forget it. Move along to the next building.

If you'd like help finding FHA approved condos, I know many in the Chicagoland area and am happy to help. Contact me anytime!

My Next House

2009-03-05T16:42:00.006-06:00

"America's First Green Mansion", located Manalapan, Florida:

1.6 acres of gardens
15,000 square feet of mansion
7 bedrooms
11 baths
Featuring: an aquarium wet bar, waterfall spa, floating sun terraces, bedroom ocean views you could only dream to witness, and more!

And the green factor -- it's entirely energy self-sufficient!

How does a 15,000 square foot mansion provide enough energy to power itself entirely? Well... it probably helps to have enough solar panels to cover two basketball courts, and a water system that collects enough runoff to fill a swimming pool twice a month, and environmentally conscious lighting system that also takes advantage of natural light.

Really?

2009-02-24T15:50:00.003-06:00

I honestly sometimes wonder about some agents. The other day I tried to show a condo. The listing agent gave me the lock box code so that I could get the key to show it (unit #2); she warned me that the lock box was sticky and I'd have to mess with it a couple of times to get the key out.

So I drive Zack to the property to show it to him and the lock box is definitely stuck. So stuck, in fact, that neither of us could get the key out even after trying for close to 5 minutes. I called the listing agent to no avail - all I got was her voicemail. There was definitely no way we were going to be able to see unit #2.

Luckily we were taking a look at another unit (unit #3) in the building so it hadn't been a complete waste of time to drive there. The listing agent for unit #3 actually met us there to let us in. I told her that I'd tried to show unit #2 and couldn't get the key out. She told me that she wasn't surprised - many people had told her that; she didn't think unit #2 had ever actually been shown because no one could get in and unit #2's agent never returns calls or has even tried to put on a new lock box. Really?? I can not believe it when I hear things like this - if that was my listing, you better believe I'd have a brand spanking new lock box on that unit before you can say the words "lazy agent". No, wait, I wouldn't even have done that - I would have personally accompanied every showing to be sure that the buyers can get in to see the unit!

Meanwhile, the poor owner for unit #2 has had his property on the market for over 200 days. And in that time, the price has been reduced and reduced and is now down to $209,000. And the worst part is, I'm sure he has no idea that his agent is not actually even showing his property.

And here's another kicker... I see photos like this all the time on listings. Really? As if in the age of digital cameras, you couldn't take the time to snap ONE MORE decent shot of the building without your finger covering the lens?

First Time Homebuyer Tax Credit UPDATE!

2009-02-14T12:15:00.005-06:00

Congress passed the stimulus bill late Friday night. What does this mean for the housing market?

It means we're about to see an influx of buyers. One major item of note is a revision to the First Time Homebuyer tax credit. This is GREAT news for the housing market and will really be enticing for first time buyers. Here's how it will work:

To qualify for the credit, you must be a first time homebuyer or have not owned a home in the past 3 years. If your income is over $75,000 ($150,000 for married couples filing taxes jointly), the credit starts to phase out and is completely phased out after $95,000 of income ($170,000 married filing jointly).

If you purchase a home after Dec. 31, 2008 and before Dec. 1, 2009, then when you file your taxes, you'll be entitled to claim the credit. The credit is now $8,000 (or 10% of the purchase price of the home, whichever is lower), up from the previous $7,500 credit. The best part is - YOU NO LONGER HAVE TO REPAY IT! The previous law required the $7500 tax credit to be repaid, interest free, over a 15 year period. With the new law, you won't have to repay the credit unless the home ceases to be your main residence within 3 years. This is FREE MONEY, people.

This means: if you make less than $75,000 as an individual, and purchase a home for $80,000 or more, and you continue to live in the home as your main residence for 3 years, you're entitled to the full $8,000 credit and do not have to repay it!

You can use this money any way you like - buy new furniture, pay down your mortgage, fix up your house, buy a car, start a business, go on a trip, invest it... the possibilities are endless!It's money for YOU, no strings attached!

How you claim the credit:

When you file your taxes after buying the home, you'll fill out a worksheet which you'll attach to your 1040 (tax return). If, say, you otherwise would have been getting a $1000 federal tax refund, you'll now be getting a $9000 refund (assuming you qualify for the full credit)! Or, on the flip side - if you would have owed $1000 in taxes, you now will actually be getting a $7000 refund!

Once the IRS posts guidelines, I will provide a link to the tax credit worksheet that you can use to claim the credit, so keep checking back! And as always... contact me if you have any questions at all!

More Green

2009-02-10T13:01:00.003-06:00

As a continuation from the previous message, here are some medium-cost ways to go "green" in your home:

Conduct an energy audit to determine how you can implement efficient projects in your home cost-effectively.
Tune up your HVAC (heating, ventilation, & air conditioning) to keep it running efficiently
Replace carpet with no-VOC (volatile organic compounds) carpeting.
Instead of normal hardwood floors, consider using bamboo floors (bamboo grows faster than any other plant - up to 47 inches a day! - therefore it is less depletive to the environment)
Install a tankless water heater (water is heated on-demand, rather than stored in a tank and constantly heated, thus reducing energy needs)
Insulate attic and other areas to reduce temperature loss.
Buy recycled products!

Eileen's Going Green

2009-02-09T15:52:00.005-06:00

So, I'm now working toward getting the brand-new GREEN/Sustainable Property designation recognized by the National Association of Realtors. It's the first designation of its kind and I think GREEN is the wave of the future so I'm trying to keep up!

Here are some low-cost ways to make your home "green":

-Use energy-efficient CFL or LED lightbulbs

-Install low-flow showerheads and faucets to save water

-Start a compost pile

-Insulate your hot water heater to reduce heat loss

-Weatherstrip and caulk doors & windows

-Collect rainwater to water plants

-Paint with low-VOC paints to keep chemical fumes out of your home & body

-Install programmable thermostat so the heat or A/C turns down while you're at work

-Install motion sensors so lights will automatically turn off when room is not in use

-Take advantage of daylighting

-RECYCLE!

Condo Mortgages - New (not-so-buyer-friendly) Guidelines

2009-01-26T13:04:00.005-06:00

Since the market crash we've witnessed throughout 2008 and into 2009, the condo market has become a more risky in the eyes of mortgage lenders. The reason for this is manyfold:

1) Often times, a condo is not the primary residence of its owner. Frequently, people buy condos for investment purposes (to rent out), or as second homes. This isn't so much the case in a major city like Chicago but is often the case elsewhere. The problem with this is that when someone is in trouble financially, their investment property is usually the first to go. Generally, when faced with the inability to pay both mortgages, people will stay in their main home and let their investment property get repossessed by the bank. This has led to a higher number of foreclosures in condo buildings, especially in those that were built with the intention of selling to investors.

2) In an over-saturated market like we're faced with today, condos are tough to sell. For example, the Park Place building in Lakeview (655 Irving Park) currently has 53 units for sale! With about 900 units in the whole building, this means about 6% of the building is for sale. This is not uncommon to see in today's market. The problem is that a lot of big condo buildings are just floor after floor of the same unit. When there are 10 other condos on the market with the same floorplan as yours, the competition really increases, and prices start to come down. Lenders don't like to see this. And if one of those units is foreclosed on, the bank suddenly owns an asset where there is severe downward pressure on it's value.

Because of the increased risk of condo purchases, new Fannie Mae guidelines will be adding a fee of .75% of the loan amount on 30 year mortgages for condos with less than a 25% downpayment. This will be effective April 1, so if you're thinking about buying a condo this year, don't wait around!

Positive Signs in the Housing Market

2009-01-20T12:09:00.003-06:00

According to Richard Bove of investment banking firm Ladenburg Thalmann, one of the country's veteran financial analysts, there is a positive dynamic taking shape in the current cycle:

Bove said he expects “housing prices to stabilize and/or rise (in 2009) after a likely boom in mortgage refinancings as rates fall and loan applications increase.”
Add in the expected massive economic stimulus package being put together on Capitol Hill with the incoming Obama administration – and there's a good chance we're going to see a gradual transformation of the downward cycle into a slow rebound over the coming several quarters.
Mortgage rates continue to hover at 50-year lows – 5% and even 4.75% for 30-year mortgages, and still lower for 15- and 20-year mortgage terms.
There are signs that housing prices are stabilizing in some parts of the country. The latest monthly Federal Housing Finance Agency index found home prices up by 0.6% in the Mountain states and by 0.2% in New England.
We're all paying a lot less at the gas pump, and sharply discounted prices for retail goods and autos.
Americans are actually saving again, the national savings rate took a nearly 3% jump last month. That might sound small, but it's hugely important if it is the start of a trend.

Keep your eyes open for the small positive signs that are accumulating out there … because all down cycles tail off and come to an end.

From: http://realtytimes.com/rtpages/20090106_realestateoutlook.htm by Kenneth Harney, Realty Times, Jan. 6, 2009

Changes to First Time Buyer Tax Credit - FREE MONEY!!

2009-01-19T11:16:00.006-06:00

Great news for First Time Home Buyers in 2009!! The government proposed on Friday that the $7500 tax credit for first time home buyers will not have to be repaid for homes purchased after January 1, 2009! Originally this credit was essentially an interest-free loan given by the government and repaid over the course of 15 years.

Potential new tax law changes allow for NO REPAYMENT of this loan. It would apply to purchases of homes through July 1, 2009.

Think about it... on a $200,000 mortgage, that means the government will actually be GIVING you more than enough enough to cover a 3.5% down payment on a home (FHA loans still only require 3.5% down). Of course you'll have to front the money at the closing table, but if you file your taxes the next day, you won't have long to wait until that money is refunded to you by the IRS.

Toronto's Little House

2009-01-16T09:49:00.021-06:00

Take a look at this one! No doubt it's the smallest house I've ever seen. This comes from an email that has been floating around for about a year saying that this house is in Brooklyn; turns out it's actually in Toronto. It was built in 1912 on the newly paved driveway of a neighborhing home after the city wouldn't allow the curb to be cut to accommodate the new driveway. It sits on a piece of land only about 7 feet wide! The interior is under 300 square feet, smaller than most studio sized condos in Chicago! And it carried a price tag of $179,000.

I'll walk you through a tour of this lovely palace.

This living room has plenty of space for your 12 inch flat screen TV. Good thing, because you're sure to be hosting a lot of guests in this party house!

Bed is here, then its gone, here, gone, here, gone. And what, the mattress is sold separately??

And how smart of them to fit a washer/dryer in the home as well.... I mean, with all that closet space, you're gunna have a lot of clothes to wash...

And then of course even a back patio overlooking the beautiful driveway of the neighbors. How relaxing.

Brown Earth Cow

2009-01-07T14:36:00.007-06:00

2009 on the Chinese calendar is the year of the Brown Earth Cow (AKA Ox). On the calendar of real estate, I call it the year for first time homebuyers. In addition to the $7500 first time homebuyer tax credit, there are so many reasons why this year is a great time to jump into the world of homeownership! Home prices have fallen...and fallen...and fallen. Many homeowners in dire need of moving or selling their home have gone to short sale and sold their homes for less than they owe on the property. There comes a point when people decide that the benefit of moving/selling does not surpass the downfall of selling for a lower price, and they take their home off the market. When that moment hits, supply drops - and when it drops enough, that's when prices stop falling. It's just the law of supply and demand, we learned this in high school people!

Well, here's the pertinent info (based on 3rd quarter 2008 data from the Chicago Association of Realtors) - Seriously, READ IT, even if you don't like numbers -

Of 75 Chicago neighborhoods we have data for, 50 of them now have median home prices LOWER than the same quarter in 2004. Only 25 neighborhoods have a higher median price than they did in 2004.

28 (over one third) of the neighborhoods currently have median home prices lower than the same quarter in 2003.

Only going back to 2001 do we see that all neighborhood's prices are higher now than in that year. 2008's median home price is higher than 2001's prices for all 75 of the neighborhoods.

So this is telling me that we're back down to prices from around 2002...

Looking back at historical interest rates, current 30 year fixed mortgages are about the same level they were in 2002. So that means it is no more or less expensive to buy a home for a certain dollar amount.

So I could actually buy a home for the same price at the same interest rate that I could have 6 years ago? And I don't even need Doc Brown's Delorean for it?

If that doesn't give you a reason to save up 3.5% for a downpayment, what will??

Get more info on this Tuesday Jan 27 at 6pm at the Coldwell Banker office located at 1840 N Clark Street in Lincoln Park. It'll be a really good info session, don't miss!!

(This blog post was edited on 1/10 to reflect an error I found in data pull)

Housing Assistance Tax Act of 2008

2008-12-17T10:37:00.007-06:00

There's been another change in tax laws which will benefit homeowners this year. The IRS will allow up to $1000 in real estate tax deduction for non-itemizers. What this means to you is:

When you do your taxes each year, you have the option to either itemize, or use the standard deduction.

Usually you'll itemize if you have a significant number of tax deductions, such as mortgage interest, property taxes, or significant medical or dental expenses. You'll add these deductible amounts up and subtract them from your income in order to figure your taxable income.

However, the IRS also gives you the option to take a standard deduction amount - no questions asked, no receipts needed - without itemizing. These amounts differ depending on your filing status and a few other factors, but for a married couple filing jointly this year, the standard deduction is $10,900.

This means that if a married couple's itemized expenses are less than $10,900, they're better off taking the standard deduction.

So, for someone who just purchased a home this year, this can be frusturating. "I thought I would be able to deduct my property taxes and mortgage interest this year!!" they say. Well, if you bought the property in, say, October, you might not have paid enough in mortgage interest & taxes in 2008 to exceed the standard deduction amount.

However, this year, the IRS is giving you a little present :-) Even if you are not itemizing your deductions because they don't exceed the standard deduction amount, the government will allow you, as a homeowner, to deduct an additional $500 ($1000 if married filing jointly) for property taxes you paid.

Add that to the list of "why now is a great time to buy"!

Happy Holidays From Fannie & Freddie

2008-11-25T07:50:00.004-06:00

Fannie Mae & Freddie Mac issued orders suspending foreclosures from Nov 26 - Jan 9 just in time for the holiday season! This suspension is intended to help implement the new Streamlined Modification Program which will be launched in a few weeks.

The newly announced loan modification program is aimed to help high-risk borrowers who have already missed at least 3 mortgage payments and haven't filed for bankruptcy. Loan modifications can be done by either reducing the interest rate, extending the length of the loan, or temporarily reducing principal payments.

The suspension on foreclosures only applies to occupied properties, not to vacant homes and should help 6000 borrowers avoid foreclosure at the end of this year.

I think this is a great step in the right direction....

End Of Wall Street's Boom

2008-11-24T13:38:00.006-06:00

This little diddy was emailed to me today by an old co-worker. It's a really interesting look at how the past 20-30 years in Wall Street banking led to the financial crisis we've been hit with today. It's a pretty long article but definitely worth the read for some insight. It's written by Michael Lewis, author of Liar's Poker who is now being validated in his qualms about Wall Street 20 years after the book's publication. Much of this is relevant to the condition of the housing market today so I'll pick out a few such excerpts:

There’s a simple measure of sanity in housing prices: the ratio of median home price to income. Historically, it runs around 3 to 1; by late 2004, it had risen nationally to 4 to 1. “All these people were saying it was nearly as high in some other countries,” Zelman says. “But the problem wasn’t just that it was 4 to 1. In Los Angeles, it was 10 to 1, and in Miami, 8.5 to 1. And then you coupled that with the buyers. They weren’t real buyers. They were speculators.”

In 2000, there had been $130 billion in subprime mortgage lending, with $55 billion of that repackaged as mortgage bonds. But in 2005, there was $625 billion in subprime mortgage loans, $507 billion of which found its way into mortgage bonds. Eisman couldn’t understand who was making all these loans or why.

He called Standard & Poor’s and asked what would happen to default rates if real estate prices fell. The man at S&P couldn’t say; its model for home prices had no ability to accept a negative number. “They were just assuming home prices would keep going up,” Eisman says.

Read the full article here: http://www.portfolio.com/news-markets/national-news/portfolio/2008/11/11/The-End-of-Wall-Streets-Boom#page1

Obama Drama

2008-11-14T10:11:00.005-06:00

I think the fact that our next U.S. president comes from Hyde Park on the South Side of Chicago may have a teeny bit of influence over whether we get the Olympics in 2016, don't you? The only real drama at the Obama rally in Grant Park on Nov 4 was Oprah crying on the shoulder of a random stranger; there were no "incidents" or any form of violence. The crowd was estimated to be somewhere in the ballpark of 250,000 people, so he's already proven that Chicago can handle crowd control.

I was there (not in the special people section, but in the overflow areas watching Senator Obama speak on the big screen), and this place was PACKED. Zack and I rode our bikes down there on a whim after his flag football game, and were glad we went. Really, this was a historic event and it was very exciting to be able to be there for it in our very own city of Chicago. On the bike ride down, most streets were blocked off. But for whatever reason, there were still cars on State Street, and you could hear the echo of honking horns from blocks away. There was honking, waving of flags, crying, cheering, chanting, screaming like crazy people, and much more. I can't even explain the sound of it... you really had to be there. But as soon as Obama took the stage, the crowd fell silent to watch and listen.

Either way, I'm glad we maintained a tame atmosphere in Grant Park on Nov 4 and I'm also crossing my fingers that our "good behavior" gives us brownie points when it comes to picking the location for the 2016 Olympics next year.

I know this is a terrible picture of the Obama rally, but it was the best I could do with my camera phone! I'll get better photos off Zack's camera later...

CTA Strikes Again

2008-11-13T11:04:00.008-06:00

Start saving your pennies, commuters. The CTA is planning on raising fares again in January. The increase will be up to 50 cents per ride, depending on which card you use.

Bus rides will be $2 instead of $1.75, and el train rides will go up to $2.25 from $2.00. They're also eliminating the discount that Chicago Card users now receive. Prices of multi-day passes are also going up.

The CTA blames the increases on Governor Blagojevich for allowing seniors to ride free.

For The First Timers...

2008-10-27T17:44:00.007-05:00

As we get closer to the end of the year, it's time to consider tax incentives for buying a home. If you are a first time buyer, you may be eligible for the first time buyer tax credit being offered by the federal government through July 1, 2009! If your income is $75,000 or less (double that if you're a married couple)and you bought a home after April 9th this year, don't let this credit pass you by when you're filing your tax return next year!

How it works:

If you're a first time buyer with a home purchase between April 9, 2008 and July 1, 2009, you may qualify (see income criteria above).

When you file your tax return, you'll get up to a $7500 refundable tax credit (you'll get less than that if the purchase price was under $75,000), as an interest-free loan from the government.

The tax credit is to be repaid over the course of 15 years, or earlier if you sell the home. If you don't have a capital gain on the sale of your home later, repayment of the loan is waived!

You don't have to begin repaying the loan until 2 years after the credit is claimed.

For example:

You bought a home in September 2008 and qualify for the tax credit. In early 2009 when you file your tax return, you will claim the $7500 credit on your tax return.

This means if, for example, you'd otherwise owe $1000 in taxes to the government, the first time buyer's credit will actually get you a $6500 REFUND!

In 2010, you'll begin repaying the government back at $500 per year for the next 15 years. If you sell the home before it's been fully repaid and don't have a capital gain on the sale, the rest of the loan repayment is forgiven.

Don't let this fantastic incentive pass you by if you're thinking of buying in the next year!

The Donkey & The Elephant Discuss Housing

2008-10-22T10:44:00.006-05:00

In the weeks just prior to the election, you can't help but wonder...how do the candidates stand on home ownership? What will they do to crack down on predatory lending? Here are some brief details: Obama/Biden

~Universal Mortgage Credit - This credit will provide an average of $500 mortgage tax credit to 10 million homeowners, the majority of which earn under $50,000/yr.

~STOP FRAUD act - This act will officially define "mortgage fraud" in the law books as well as increase funding for enforcement programs and provide stricter penalties for those convicted of mortgage fraud.

~HOME score - Obama/Biden want to create a Homeowner Obligation Made Explicit score which will allow buyers to easily compare loans and understand the actual cost of borrowing.

~Bankruptcy Loophole - Currently, bankruptcy courts cannot modify mortgage payments for an individual. Obama/Biden want to eliminate this provision in federal law.

McCain/Palin

~Federal assistance to borrowers should not bail out speculators who took unnecessary risk.

~Increasing financial assistance should go hand-in-hand with increasing transparency and accountability.

~HOME plan - homeowners who meet certain guidelines will be given the opportunity to trade their mortgage for a manageable FHA loan reflecting their home's current market value. The McCain camp estimates this will keep up to 400,000 families from losing their home.

Spooktacular Haunted Houses

2008-10-10T12:31:00.009-05:00

Every year around Halloween I try to hit up at least one, if not more, Haunted Houses. Here are some that I've been to in the past in Chicago:

Haunted Sanitarium at Theatre On the Lake (Fullerton & Lake Shore) - kind of your standard haunted house with a strobe light room, haunted graveyard, and mangled monsters carrying chainsaws that try to freak you out while you wait in line; not horribly scary but still frightening enough to be entertaining and definitely a good length. Guys - great for a date!

Disturbed at the Oracle Theatre (Broadway & Grace) - Let's just say the name is an understatement. Each year's show is a different short "interactive play" where the audience stands in the middle of the scene and the show is enacted around them. Last year's was too disturbing to even describe the plot line... let's just say this is not really as scary as you'd think... but very "I can't believe they're allowed to perform that"-type-of-disturbing. Guys - NOT great for a date!!

In the past, I've also been to a "adults only" haunted house at the club formerly known as Cherry Red (now one of my favorites, Uncle Fatty's Rum Resort) on Sheffield just north of Diversey. Unfortunately we thought it was "adults only" just because you were allowed to mingle at the bar beforehand and bring drinks through the haunted house, followed by a free shot of liquor at the end; we learned the hard way that "adults only" meant "adult themed" and was geared more towards necrophiliacs.

My Favorite Virtual Tours

2008-10-09T13:41:00.005-05:00

These are some places that my team and I have listed for sale. Take a look at these beautiful homes using a 360 degree virtual tour...very cool stuff!

Beautiful 5BR/5.5BA Custom Built Home

HUGE 3BR Restored Vintage Condo In Lakeview

Another Enormous and Beautiful Home 6BR/5.5BA (potential short sale!)

Mark-to-Market

2008-10-07T16:16:00.007-05:00

What determines the market value of property? Think about what the term market value means... Market value is the highest amount that someone in an open market is willing to pay for something.

That's why today's real estate market is very tough for sellers. Many fail to realize that market value is not determined by how much was originally paid for the property, or by how much the property's value "should have" increased since you bought it. A property's market value is equal only to what the market is willing to pay for the property NOW. This is dependent on a number of factors, specifically factors related to the economy. When unemployment is increasing, credit (lending) is tightening, the dollar's value is falling, people are losing equity in other investments, and cost of living is still rising... the market value of a given property will decrease. Why? Because in a market like that, people have less buying power and tighter budgets. Unfortunately this is the case today.

The best way to determine the market value of your property is to get as many potential buyers in for showings as possible. The more people that see it, the more opportunities you have to receive offers.

Of course, before you get showings on your property you have to decide on a listing price. Sounds like a catch-22, right? Not really. Your realtor should be familiar enough with the market to know what properties similar to yours have been selling for in recent months. This is why it is very important you sit down with your realtor and have them do a comparable market analysis (CMA) for you before listing your property for sale.

I'd rather have a seller price their property lower and leave minimal negotiation room, than price the property too high (to leave room for negotiation) and not get any showings. With as much housing inventory as there is right now, people do not have the time to see everything. So they'll start from the lowest priced properties and work their way up. Don't let your property be the last on the list for viewing!

I'd also rather see a seller get 5 low offers that they have to turn down and finally get one good offer, than not get any offers at all because the property was priced too high to attract showings.

My point? Price your property reasonably and you may even end up with a better offer than if you'd priced it too high!

Buyers' Security Blanket

2008-09-26T16:32:00.008-05:00

Despite my teeney bit of experience in the banking industry, I certainly would not consider myself an economist by any means and therefore don't want to delve into my opinions on the pros and cons of the so-called government bailout we're hearing about every day recently.

One thing I'd like to point out, however, is the real estate market tends to be largely driven by consumer confidence. Take, for example, the "home flippers" of a couple years ago who were buying & flipping homes left and right on the confident whim that the market would keep going up. Or look at now, when job security is shaky, we're all uncertain about the future, and essentially people have lost confidence in the economy - the high end real estate market has become a desolate landscape of multi-million dollar mansions left vacant and on the market for months and the other ends of the market aren't doing much better either.

U of M Consumer Confidence Oct 2006 - Present

What am I saying? I think that no matter what the government intervention does to the economy, this intervention in itself will be enough to boost consumer confidence and see a pick up in home sales. Prices can't drop forever and it is uncertain how long mortgage rates will remain so low, so these facts, along with the government acting as a "security blanket" for buyers, should have an encouraging affect on real estate sales.

I'm Back! ... with some info you might find interesting

2008-09-15T13:03:00.005-05:00

After a little blogging hiatus, I am back in full-force. Since the last update, I have switched to Coldwell Banker to join a team of two women who have been successful in the real estate business for 30+ years. Also, since the last update, there have been a number of monumental occurences in the real estate market. Most notably, last Sunday, the government took control of Fannie Mae and Freddie Mac. Effectively this has decreased mortgage rates for conventional loans by a significant amount in just a matter of days. Why is this, you ask? Let me break it down.

Fannie Mae was a child of the Great Depression, followed by the creation of Freddie Mac in 1970. For a very simple dissection of how Fannie Mae & Freddie Mac work to support the mortgage banking system, see below.

Banks make money off the interest they charge on the loans they make. The reason they even have money to lend is that they hold cash in the form of deposits & savings from people like you and me. So basically when a bank loans money to someone as a mortgage, they are lending out a portion of the money you've deposited into your savings (or some other form of) account.

The problem is that mortgages are generally long-term - so if a bank loans out all of its money in the form of mortgages, it would have to wait many many years before it can make another profitable loan since it won't have any more cash to lend. Also, if it lends out all of it's money, you and I wouldn't be able to cash out our savings accounts. Not a very sound business plan, right? Also, with this structure, very few people would actually be able to get a home loan since money would be so tight.

That's where Fannie Mae & Freddie Mac come into play. Our government believes that home ownership is very important to our economy and quality of life. Without being able to get a home loan, it's very difficult for many people to own a home. So they created Fannie & Freddie. Fannie & Freddie purchase mortgages from banks - essentially, they purchase the right to receive the monthly payments from the borrowers. When the bank sells these mortgages to Fannie & Freddie, it gets cash which allows them to make more loans and remain liquid. Fannie & Freddie then "securitize" the loans - they package the loans into bundles based on credit risk, and sell these packages called Mortgage Backed Securities (MBSs) to investors. So Fannie & Freddie get their cash, and the investors have a variety of credit profiles to choose from in order to meet their investment strategy. Fannie & Freddie then guarantees the MBSs so that if any of the homeowners default on their mortgage payment, the investor still gets paid by Fannie or Freddie due to the guarantee. Therefore, as long as Fannie & Freddie are financially solvent, the investor gets paid.

The problem comes into play when it looks like Fannie & Freddie might not be able to back all the loans that are defaulting. With an increasing number of mortgage defaults over the past year, investors began to wonder...

Interest rates are based on credit risk. If you were going to loan $1000 for a year to someone who had a good job, a history of timely loan payments, and a good credit score, you might ask for $1030 (AKA 3% interest) at the end of the year. But if you were going to lend that $1000 to someone you know has a history of losing his job, failing to pay bills, missing credit card payments, etc., you might ask him to pay you $1100 at the end of the year (10% interest) since the only thing that would be worth the risk of not being paid back would be the potential for the extra cash at year end.

With credit risk increasing on Fannie & Freddie backed loans, interest rates increased. But when the government took over the two entities, all of the loans backed by Fannie & Freddie became risk-free. That's because the government has taxing authority and will always be able to fund its obligations. So, when the government took over Fannie & Freddie, interest rates went down.

So overall, banks need money to make loans. People need loans to buy homes. Fannie and Freddie buy mortgages from the bank which frees up money to be lent. Without Fannie & Freddie, we'd be in trouble. So good thing the government has stepped in to avert a more serious crisis.

Make sense?

How Long Should It Last?

2008-06-03T18:37:00.009-05:00

If you've been home-shopping recently, you may have heard comments such as "the roof is 8 years old"... but for some buyers this doesn't mean much. Is that old? Is that new? How long should a roof be expected to last anyway? Well, the National Association of Homebuilders (NAHB) has some answers for you.

The NAHB did a survey to determine the average life expectancy of a number of household items and appliances. Of course these are just average expectancies, and some other factors play a major role in how long something will last, such as quality of installation, frequency of use, and standard of maintenance.

Here are some common household components and their life expectancies (in years):

Dishwashers - 9 yrs
Washing Machine - 10 yrs
Dryer - 13 yrs
Electric Water Heater - 11 yrs
Gas Water Heater - 10 yrs
Refrigerators - 13 yrs
Microwave - 9 yrs
Electric Range/Stove - 13 yrs
Gas Range/Stove - 15 yrs
Electric Furnace - 15 yrs
Gas Furnace - 18 yrs
Brick Masonry - 100+ yrs
Stucco Siding - 50 to 100 yrs
Cultured Marble Counter - 20 yrs
Natural Stone Counter - lifetime
Wooden Decks - 20 yrs
Fiberglass, Steel, or Wood Doors - lifetime
Screen Door - 40 yrs
Vinyl Door - 20 yrs
French Door - 30 to 50 yrs
Copper Electrical Wiring - lifetime
Whirlpool Tubs - 20 to 50 yrs
Carpet - 8 to 10 yrs
Concrete Flooring - 50+ yrs
Marble Flooring - 100+ yrs
Slate Flooring - 100 yrs
Tile Flooring - 20 yrs
Laminate Flooring - 15 to 25 yrs
Linoleum Flooring - 25 yrs
Vinyl Flooring - 50 yrs
Wood Flooring - Lifetime
Engineered Wood Flooring - 50yrs
Exterior & Interior Paint - 15+ yrs
Asphalt or Modified Bitumen Roof - 20 yrs
Coal & Tar or Wood Roof - 30 yrs
Slate Roof - 50 yrs
Clay/Concrete Roof - lifetime

Believe it or not, these are only a selection of what I find to be most useful for buyers to know... if you want the complete list, do not hesitate to contact me!

Investment TacTICs

2008-05-16T10:32:00.007-05:00

Tenant-in-Common (TIC) arrangements are one way that as an individual, you can have an interest in a large real estate investment. The investment can be any type of real estate, from large retail spaces, to offices, multi-family buildings, industrial properties, and much more.

In a TIC arrangement, you own a fractional share of the property. Similar to a share of stock, you are given a fractional share of the whole investment. A group of investors is organized into a TIC structure and is then able, as a group, to aquire a large property. Up to 35 owners can enter into this sort of partnership and each owner gets voting rights. Each partner is given a percentage interest in the property, and then receives this fractional share of cash flow, tax benefits, appreciation, and depreciation on the asset. The fractional interest in the investment is passed along to the owner's heirs, rather than being absorbed by the remaining owners, as a joint tenancy arrangement would work.

A TIC arrangement can satisfy the requirements of a 1031 exchange, if done properly. In 2002 this type of ownership started becoming popular after the IRS issued guidelines on how a joint property venture can satisfy a 1031 exchange. A 1031 exchange, for those who don't know, is an investment timed and structured in such a way that it allows the owner to legally defer the capital gains taxes on the sale of another property.

A TIC arrangement allows you to avoid the hassles of property and asset management (since a third party will have this responsibility), while reaping the benefits of real estate ownership. Additionally, by only owning only a small portion of one large property, this leaves the investor with additional capital to enter into other TIC arrangements in order to diversify their property holdings.

If you're interested in hearing more about how a TIC investment can benefit you, or how you can get involved in one, contact me! I have contacts at a company with a proven track record in structuring these types of deals.

MONTHLY MARKET STATS - APR 08

2008-05-06T21:50:00.005-05:00

In the month of April, we saw an almost across-the-board increase in market supply, in what I believe to be a correction to the sudden supply drop of the previous month. A number of buyers were hit hard in April as mortgage restrictions tightened again, decreasing demand for homes. My prediction is that May will yield an overall stabilization in market supply, with the exception of the Near South where supply will significantly drop from this month. I attribute much of the Near South Side's increase in market supply to several developments that listed a number of units for sale in April, including 1555 S Wabash and 1211 S Prairie.

Based on currently available home inventory and units which sold & closed in the month of April, below you'll see the current amount of housing supply in various Chicago neighborhoods. Next to each neighborhood, I am indicating whether the supply has increased or decreased from MArch. The information I'm including is based on attached housing (condos/town homes). If you'd like another type of information, please contact me and I'd be happy to help.

North Center = 7 months (decrease)

Loop = 7 months (increase)

Lakeview = 8.5 months (increase)

Logan Square = 8.5 months (decrease)

West Town = 10 months (no change)

Uptown = 10 months (increase)

Lincoln Park = 11 months (increase)

Lincoln Square = 14 months (increase)

CHICAGO ENTIRE MARKET = 14.5 months (increase)

Near West = 15 months (increase)

Near North = 15 months (increase)

Near South = 23.5 months (increase)

Ever Wondered About... Closing Costs??

2008-05-01T17:10:00.009-05:00

Especially for a first time home buyer, but also for a repeat home buyer, it may be difficult to estimate all of the costs involved in purchasing a property. Below I have itemized all of the approximate costs involved in closing a home for your reference.

Note that it usually costs you nothing to use a realtor when buying, except that if you don't, you might unknowingly overpay or miss some necessary details and paperwork.

Also, before getting scared away by the length of this list, keep in mind that this is an extremely detailed breakdown and many of these charges are VERY MINIMAL, some under $100. Add these to a mortgage financed over the span of 30 years and the additional burden is hardly noticeable.

- Loan Application Fee is paid to the mortgage company for the appraisal and credit report $350-550

- Final Inspection and Recertification of Value $75-$100

- Points may be paid to the lender at closing in order to "buy down" your interest rate

- Private Mortgage Insurance (PMI) is required when the loan is greater than 80% of the home's value. It runs about 0.52% of the loan amount annually, or higher if the loan is over 90%.

- Prepaid Interest - you pay interest on the mortgage from the date of closing through the end of the month

- Underwriting Fee is charged by the lender $250-$400

- Processing Fee is paid to the mortgage broker to process the loan $150-$200

- Document Preparation Fee is the cost to prepare the closing documents $200-$250

- Tax Service Fee is charged by the lender to obtain tax bills and monitor payment of taxes $60-98

- Flood Certification Fee is charged by the lender to determine if the property lies in an area at risk for flooding $25-$30

- Lender's Title Insurance Policy insures your lender's interest in the property is a first mortgage $150-$400

- Settlement & Escrow Closing Fee is paid to the title company to act as a lender's agent in handling the closing $100-$350

- Transfer Taxes vary by local ordinance but are $7.50 per $1000 of purchase price in Chicago

- Escrow/Reserves vary by month of closing

- Tax Reserve Fund, if required by the lender, will be a couple months worth of taxes put into escrow

- Attorney Fee varies by attorney $400-700 total or an hourly rate

- Recording Charges to record the mortgage and assign a mortgage and deed or release $60-$130

- Property Inspection is optional (but usually recommended) $250-$500

- Lead Based Paint Inspection is optional $200-$350

- Homeowner's Insurance varies by location and property

- Service Release Premium is compensation paid by the lender to a mortgage broker 1%-1.5% of loan amount

FHA/VA Loans may also include:

-Commitment Fee charged by the lender to lock the rate and points $250

-Mortgage Insurance Premium paid to HUD to insure mortgage against default. A one-time premium is required on all single-family and 2-4 units of 2.25% of loan at closing. Annual premium is .5%, paid monthly on all property types.

- Origination Fee charged by the lender 1% of loan amount

Chicago 2016!

2008-04-22T12:24:00.007-05:00

The major contenders for the 2016 Olympic bid include Rio De Janeiro, Tokyo, Madrid, and my personal favorite - Chicago. The final vote won't be for about another year and a half (Oct 2, 2009), however there is much planning that must take place before we even know for sure who the winner will be.

Holding the Olympic Games has historically proven to improve the city's economy drastically. The Games injected $7 billion to Sydney's economy, bumped Barcelona up to a tier 1 tourist destination, added 140,000 additional jobs in Vancouver, and increased Beijing's residential property values 59%.

In Chicago, about $1 billion of venues would be built to accommodate the Olympics. Experts predict that the games would bring an additional 250,000-500,000 tourists to Chicago for 5-7 years after, and would create 1/2 - 1 million square feet of additional downtown absorption due to the need for sales offices, vendor locations, support sites, etc. In other words... while the city might be crowded with tourists for a couple months, just IMAGINE the immense economic benefits our city will gain for many years thereafter.

The exciting thing is if Chicago gets the Olympics, the plan is to integrate most of the events into the city limits, rather than setting up a megaplex structure 50 miles out like many other host cities have done or plan to do. Notable locations planned for various events and support sites include:

- Lincoln Park: Tennis center, triathlon start

- United Center: Basketball

- McCormick Place: Paralympics, press center

- University of Illinois Pavilion: Boxing

- Soldier Field: Football

- Northerly Island: Beach volleyball, BMX biking

- Jackson Park: Hockey

- Washington Park: Olympic Stadium (will be built for a 70k capacity, which will be downsized after the games to a 5-10k capacity)

- South Loop along the Lake (near McCormick): Olympic Village where the athletes will live (this will be comprised of 2300 four-bedroom units, which will later be retro-fitted to mostly 2 bedrooms and sold to the public)

Check out volunteer opportunities to help promote the Chicago bid at http://www.chicago2106.org/ and keep in mind the great benefits you'll reap should the Olympics end up in our city eight years from now.

Invest Creatively

2008-04-16T16:43:00.005-05:00

You know it's a buyer's market. You think it's a great time to invest in real estate because you know that prices are low and are bound to turn around at some point. But you don't have enough cash. Or you're not sure the rent you'd receive would cover the mortgage. But you know the appreciation over time would be worth investing now. If you're interested in investing in real estate for the long-term but aren't sure how to fund it, consider an often-overlooked asset that can be used for investing in property. Your retirement fund.

Since 1974, the IRS has permitted individuals to self-direct their Individual Retirement Accounts (IRAs). The majority of the population will open a brokerage account and buy some equity shares (stock) in a company they think will be a winner. They'll buy shares of a mutual fund or invest in the money market. Or they'll invest their 401K in a few of a handful of funds offered by their company. And the more conservative investor will choose notes and bonds. But a retirement account allows you to invest in ANYTHING that is held for investment purposes. So why limit your investments to financial securities? It is unbelievable to me that only 3-4% of existing IRAs are invested in alternative assets!

Before I go further, let me clarify to avoid any confusion. Please understand that what I am talking about is different from BORROWING from your IRA in order to purchase a home. I'm referring to actually investing your IRA funds in a piece of real estate which is to be held as an investment only. You don't borrow from the IRA and pay it back; you are directly investing the IRA funds into the property itself, rather than a stock, bond, or other similar security.

There are a number of restrictions on investing your IRA in real estate, however if you find a great opportunity, it is well worth speaking with a qualified person on whether this can be done or not. You'll need to speak with several professionals, including an attorney, CPA, financial advisor, custodian, and of course a realtor to help you find the property and deal with processing the transaction. But it can be done!

Your options span from a rental property in Malibu, a strip mall in Arizona, vacant land in Montana, pre-construction in Chicago, a fixer-upper elsewhere, or even a hog farm in Iowa. Anything goes. The basic rules require that the property must be held for investment purposes only - that is, you and/or your family cannot live in it or gain any benefit other than the cash flow (which flows back into your IRA) and appreciation it provides.

Next time you open your retirement account statement and cringe at the dwindling numbers due to today's economy, think about what other options you have as far as investing in a tangible asset that will provide long-term appreciation.

Contact me for more info.

Summer in the City

2008-04-11T09:28:00.009-05:00

One of my absolute favorite things about Chicago is the SUMMER! North Avenue Beach is a massive party all weekend every weekend. You'd be hard-pressed to find a neighborhood that wasn't having a festival at least once. If you want entertainment but you're on a tight budget, you'll have no trouble finding free events. Music, food, dance, athletics, and culture abound in the warmer months of Chicago. I'll touch on some of my favorites:

1) May 2: Looptopia - OK, I'll be honest. I haven't actually been to it and I don't quite understand it but it sounds spectacular and is something I won't miss if I'm able to go. The best part about it is it's an overnight extravaganza in the heart of the city celebrating arts, culture, music, and everything else we all love, including staying up past our bed times. Oh and did I mention it's inspired by similar events that take place in faraway lands such as France & Spain?

2) May 31-June 1: Belmont & Sheffield Music Festival - In the heart of Lakeview you'll find a number of bands from the nationally well-known to the local. Live entertainment this year will be provided by Trippin' Billies, Sugar Wall, Why Store, School of Rock, and Underwater People.

3) July 11-Aug 16: Grant Park Music Fest - FREE CONCERTS. Throughout the summer the Chicago Park District offers a plethora of music-related events free to the public.

4) June 14-15: Old Town Arts Fair - A great time for the lover of both arts & beers! 260 artists display paintings, sculptures, photos, jewelry, crafts, and more! And a boatload of easy-going Chicagoans just out for a good time.

5) June 20-22: Taste of Randolph - Mmm, here's where you get to try out all of the delicious restaurants that call the West Loop home. Feel free to feast in front of the live entertainment provided by a lineup that is still TBA - however in the past, some notable names have included the John Butler Trio & Fountains of Wayne.

6) June 27-July 6: Taste of Chicago - Somehow this usually turns out to feel like the hottest weekend of the summer.. of course that may be due to the 1 million visitors this festival attracts through the two week duration. Come hungry and leave stuffed.

There are a LOT more festivals I haven't mentioned here for the sake of space but please Google "Chicago Festival Guide" for a complete list, and you'll notice that not one weekend this summer will be festival-free.

Let's be serious here, who doesn't like funnel cake?! Go to a festival this summer and find some for yourself.

Monthly Market Stats - Mar 08

2008-03-31T10:21:00.006-05:00

Based on currently available home inventory and units which closed in the month of March, below you'll see the current amount of housing supply in various Chicago neighborhoods. Note the significant decrease in overall market supply from February. Next to each neighborhood, I am indicating whether the supply has increased or decreased from February. The information I'm including is based on attached housing (condos/town homes). If you'd like another type of information, please contact me and I'd be happy to help.

Loop = 4 month supply on market (decrease)

Lakeview (includes Wrigleyville, Southport Corridor, Boystown) = 7 mo (decrease)

Lincoln Square = 7.5 mo (decrease)

North Center = 8 mo (decrease)

Lincoln Park (includes Depaul area) = 8 mo (decrease)

Uptown = 9 mo (decrease)

Near South (includes South Loop, Printer's Row) = 9.5 mo (decrease)

West Town (includes Wicker Park, Ukrainian Village, Humboldt Park) = 10 mo (increase)

Logan Square (includes Bucktown) = 11.5 mo (decrease)

CHICAGO ENTIRE MARKET = 11.5 mo (decrease)

Near West (includes West Loop, Medical District, Tri-Taylor) = 11.5 month (decrease)

Near North (includes Gold Coast, River North, Streeterville, River West, Old Town) = 12 mo (increase)

As you can see, all but two neighborhoods decreased in amount of supply for March. Before you dust off your high school economics book, I'll just tell you what this means:

1) You won't see price drastic reductions as frequently as you have seen the past year

2) There are less options for buyers

3) There is less competition for sellers

4) If you're a buyer waiting for prices to "hit rock bottom"... you already missed it. Start your search now before the supply shrinks even more.

Read Me, I'm Irish

2008-03-09T13:42:00.006-05:00

Well... it's that time of year again. In Chicago things start to get a little crazy in March. It's that time of year when we're almost over that last bump in the rollercoaster ride we call winter... spring break is just around the corner and once in a while we get a glimpse of the sun again. We are teased by a day here or there above 50 degrees, to be followed by snowfall the day after. Basketball season takes a very serious turn as March Madness begins, and most importantly we begin a 2 week celebration for a one day holiday... St. Patrick's Day.

One thing you cannot miss if you live in, around, near, or even far from Chicago is the annual South Side Irish Parade. Unfortunately - and I hate to say it - I am missing it this year. Since my job requires me to usually be working on Sundays, I unfortunately can't partake in this year's green-clad, bagpipe-playing, luck-'o-the-irish vibed, all day drink-a-thon. But I have been before so I can assure you it's well worth your while, even if you're not Irish.

You'll find the parade in Chicago's historic Beverly neighborhood. If you're going for a family outing and will be attending with the little ones, stick to the east side of the street. Head west and you're in for a rowdy ride.

The Beverly area is a unique icon in the City's landscape due to its large lot sizes, numerous single family homes, neighborhood feel, rolling hills, and of course its abundance of Irish pubs. The strong Irish-American population and heritage in the area is what has drawn the country's largest neighborhood parade.

Well, I hope you made it to the parade today, and if so, I imagine you won't be reading this post anytime today. If you're like me and were unable to go, I suggest you polish up your blarney stone and get ready to make up for all you missed next weekend when you celebrate St. Paddy's with a night (and day) on the town.

[The first photo is of my Uncle Ed Kane of the Emerald Society in the 2007 South Side Irish Parade, of course taken from the west side of the street :-) ]

MONTHLY MARKET STATS - FEB 08

2008-03-03T17:32:00.006-06:00

Based on currently available home inventory and units which closed in the month of February, below you'll see the current amount of housing supply in various Chicago neighborhoods. I'll continue to update this each month so you can see the market dynamics. The information I'm including is based on attached housing (condos/townhomes) . If you'd like another type of information, please contact me and I'd be happy to help.

Loop = 9 month supply on market

West Town (includes Wicker Park, Ukranian Village, Humboldt Park) = 9 mo

Near North (includes Gold Coast, River North, Streeterville, River West, Old Town) = 10 mo

Lakeview (includes Wrigleyville, Southport Corridor, Boystown) = 10.5 mo

Uptown = 12 mo

Near West (includes West Loop, Medical District, Tri-Taylor) = 12 month

Logan Square (includes Bucktown) = 13 mo

Lincoln Square = 13 mo

CHICAGO ENTIRE MARKET = 13 mo

Near South (includes South Loop, Printer's Row) = 14 mo

North Center = 15 mo

Lincoln Park (includes Depaul area) = 16 mo

What the market supply means: at the current rate at which homes are closing sale, it will take X months for all of the homes currently on the market to be sold & closed. This is an indicator of the current DEMAND for attached housing in these neighborhoods. You can compare these statistics to future months to help you understand how demand is changing over time.

For information on the boundarylines of each of these neighborhoods, good old Wikipedia should help: http://en.wikipedia.org/wiki/Chicago_neighborhoods

Market Stimulus

2008-02-20T09:39:00.006-06:00

Part of the economic stimulus package that President Bush signed into law last week is going to positively impact the real estate market. In addition to the tax rebates many individuals can expect to receive in the springtime, there is another benefit of this package that is more directly related to real estate.

Fannie Mae and Freddie Mac are government sponsored enterprises that help keep the mortgage market liquid by purchasing mortgages from banks & lenders; they then sell those mortgages to investors. This keeps the lending institutions from "running out of money to lend" and allows them to continue to provide financing to homebuyers like you and me. Fannie & Freddie currently cap the size of the loan they will purchase at $417,000. Part of the economic stimulus package is to increase this "conforming loan" size to $729,750. These "jumbo" loans usually draw higher interest rates, but with the passage of the law, interest rates on these larger loans are expected to decrease.

NAR forecasts that the increase in the conforming loan limit will result in:

~500,000 refinanced loans and could help reduce foreclosures by as much as 210,000

~300,000 additional home sales potentially generated

~reduced housing inventory

~home price increase by 2-3 percentage points

Additionally, part of the plan is to increase the size of FHA-backed loans to the same limit of $729,750 from a previous $362,790. FHA provides insurance on various loans and is backed by the U.S. Dept of Housing & Urban Development (HUD). The insurance on these loans allows more homeowners to purchase homes with low or no downpayment due to the decreased risk to the lender. Increasing the loan size limit on these loans will make home purchases more affordable for many.

Just Listed! Gold Coast!

2008-02-15T11:37:00.005-06:00

1br/1ba in coveted Newberry Plaza in the heart of the Gold Coast! $289,900.

The Real Estate Papparazzi #3

2008-02-14T07:59:00.003-06:00

At least not everyone is hesitant to invest in the real estate market today. The most saavy investors realize that the "buy low, sell high" adage applies right now to the housing market. Anyone who is waiting for "prices to hit rock bottom" already missed it.

Shares of the S&P Homebuilders Sector Spider (XHB), an ETF of the largest public residential homebuilders has risen 7% this year! In a year when house prices are down about 4% for the Chicago area and much more in other parts of the country, a 7% increase in real-estate derived investments is a serious sign of what's to come!

Just Listed! Edgewater Neighborhood!

2008-02-12T16:19:00.001-06:00

SUNNY, SPACIOUS & BEAUTIFUL 2 bed/1 bath near the lake and beach for $195,000! Click HERE for more info!

Please Refer to...

2008-02-06T14:15:00.000-06:00

My line of business is heavily reliant on referrals. So for my post today I am going to refer you to someone else's blog post that I think will be interesting to anyone curious about the real estate market's affect on the availability of financing.

http://www.themortgagereports.com/2008/02/how-the-declini.html

Transfer Taxes for Transportation

2008-02-01T14:39:00.000-06:00

If you live in Chicago, you're sure to be familiar with the hotly debated CTA funding issue. The City has threatened to raise fares and cut bus routes if they don't get the additional funding they need. So on Feb 6, next week, the Chicago City Council will be voting whether to raise the city's real estate transfer taxes in order to fill the transportation funding gap.

The vote is for a 40% increase in the real estate transfer tax. This would mean that buyers of real estate would pay $10.50 in taxes per $1,000 of each real estate transaction, compared to the $7.50 that they currently pay. For a $200,000 real estate purchase, this would increase the transfer tax by $600 to $2100!

Why would we increase real estate taxes by 40% in order to fund transportation? The tax will actually be funding CTA pensions and retiree health care plans. The tax won't add a single additional bus or train line or pay for upgrades or maintenance. The market is already struggling to come up with enough buyers to absorb the supply of housing... why make it even more difficult?

Visit http://wrongtax.com/ to voice your opinion on this issue or contact your alderman.

The Real Estate Paparazzi #2

2008-01-30T09:18:00.000-06:00

Some updates on much-anticipated Chicago downtown developments:

Trump International Hotel and Tower: Today's opening of the 92 story luxury development on the Chicago River at Wabash may be picketed by the hotel workers' union Local 1 of UNITE HERE. Five floors of the building will be staffed by 300 workers. Hotel officials and Local 1 have failed to come to agreement on whether the hotel's workers will be allowed to decide if they'll be a part of the union.

The Spire: Just two weeks ago sales opened on the over-1000 unit, 150 story building expected to be completed in 2012 at 400 N Lake Shore Dr. Prices range from $750,000 to $15 million, starting at about $1400/square foot. Expectations are that nearly half of the buyers will be from overseas. The low value of the U.S. dollar to many foreign currencies is sure to help meet that expectation. Construction of the building is still in a sub-ground phase where workers are drilling foundational supports into the ground.

The Real Estate Paparazzi #1

2008-01-29T13:37:00.000-06:00

Today's blog post is going to be the first of a group of posts titled "The Real Estate Paparazzi". Real estate is in the news so often these days that we almost seem to know what's going on in the market at all hours of the day, similar to how the paparazzi allow us to keep tabs on the daily lives of almost any celebrity we wish. I'd like to cover these topics and point out anything relevant to the Chicago market, as well as break them down into organized explanations. If you read any of today's headlines, you're sure to have noticed that they were chock-full of articles about how the housing market has plunged and has hit record lows and so-on. This was due to reports released by a few sources:

1) The Census Bureau report showed that 68.7% of all occupied homes were occupied by homeowners (versus renters). Last year, the number was 69.8%. This was the largest one-year drop on record. Not-so-good news for those unable to obtain a mortgage and are stuck renting, but not-so-bad news for landlords.

2) The SP/Case Schiller Index reported that this was the 11th consecutive month of negative annual home price returns nationally. This data is through Nov 2007. However, of the 20 major metropolitan areas surveyed, Chicago posted the 7th best annual return of -3.9%. Leading the pack was Charlotte who experienced a positive 2.9% annual return. Most hard-hit were Miami (-15.1%), San Diego (-13.4%), and Vegas (-13.2%).

3) Realtytrac, a real estate website which I subscribe to, reported that total foreclosure filings in 2007 increased by 75%. I just closed a bank owned foreclosure property last week which I got for my buyers at 18% below list price PLUS a $10,000 closing credit to them. If you're thinking about purchasing real estate right now for any reason, foreclosures might be the place for you to start looking. I have access to foreclosure listings; contact me so I can find you a great buy.

FOMC Emergency!

2008-01-22T20:27:00.000-06:00

Early this morning the outlook was gloomy for stocks, with the Dow expected to end the day down 600 or more points on global fears of a U.S. recession. Enter the Fed. For the first time in 7 years, the Fed voted for a non-meeting rate cut. They slashed the overnight rate by 75 basis points to 3.5% and signalled that a further rate cut was likely and could potentially occur at the next meeting, scheduled for just next week. Not only was this the first mid-meeting cut in 7 years, but it was the largest one-time cut in 17 years. The Dow ended the day down a "mere" 130 points.

What does this mean for you? While mortgage rates - long term rates - aren't specifically tied to the Fed Funds rate - a short term rate - we'll still see some effects on the costs of home ownership.

1) Those with adjustable rate mortgages (ARMs) due to reset soon will benefit from a slightly lower reset rate. It won't be sufficient to bail out anyone in serious trouble, but it will help them stretch their dollar a little further.

2) Banks dropped their prime rate after the Fed cut, which will benefit consumers with home equity loans, credit card debt, and auto loans.

3) The market has already priced in a rate cut, so mortgage rates are already very low!

4) The rate cut is likely to increase mortgage applications as buyers attempt to find the best rate possible and more people begin to consider home ownership as a possibility.

5) The down side is... don't expect your savings to grow as fast as it was before! Banks lower the interest rates they offer on savings and CDs at the same time they lower the rates at which they lend to you.

Is Now The Time To Buy?

2008-01-21T14:27:00.000-06:00

I've gotten this concern very frequently from hesitant buyers. "I don't want to buy now because I'm afraid prices will drop even more in the coming months." Here are two things to consider:

1. Real estate is a long-term investment. If you plan to buy a place and then sell it in a year, then yes, you should be concerned about where prices are heading soon. However, if you are like most buyers and expect to hold onto your property for 3-5 or more years, there are sure to be natural ups and downs to the value of your property anyway. There is nothing you can do about that and you'll NEVER know when the price is at its absolute lowest. Waiting for prices to drop and drop and drop could potentially leave you in a situation where prices suddenly skyrocket, and where does that leave you?

2. Home prices are not the only thing to consider. Mortgage rates change just like home prices change. What if you KNEW that home prices will drop in 6 months? Well, then you might wait 6 months to buy your home. But what if you also KNEW that mortgage rates would rise in 6 months? Then what would you do? For instance, a P&I payment on a mortgage for a $300,000 home at 5.5% interest would be $1703/month. However, if the price of the home FALLS 3% but at the same time, mortgage rates go up 0.5 percentage points to 6%, your monthly P&I payment would be $1744. So, you'd actually be paying MORE per month for a home that cost less.

View this blog from a respected mortgage industry leader for more insight to the mortgage market and where rates might be headed. And this article from NAR will help you understand how the real estate market is predicted to fare this year.

New Years REVOLUTION

2008-01-09T09:51:00.001-06:00

It's the first full week of 2008 and I'm sure many of us have already given into our cravings to eat junk food, sleep in and skip the workout, or wait another day to quit that bad habit. Of course, if you're a trying-to-quit smoker, Chicago's new smoking ban will help you out a bit by keeping you from lighting up in public places.

Since I am not a big fan of New Years Resolutions (who really keeps them anyway?), I'd instead like to talk about something else - Chicago's New Years Revolutions - not the things we resolve to do in our lives, but the changes that we'll witness over the course of the next year.

1. Green home ownership on the rise. As oil prices spike (last week it actually hit $100/barrel), even those less-concerned with the environment will begin to adopt more environmentally-friendly concepts for their homes such as energy-saving light bulbs. If anything, it will at least save some "green" on the utility bills as gasoline costs cut into the budget.

2. Increased celebrity sightings. With the increase in paparazzi trailing celebs and the explosion of TMZ TV and such over the last couple years, those who aren't currently working on a Hollywood project are likely to want to find a summer getaway. Chicago is a relatively undiscovered hub for shopping, attractions, fine dining, business, and night life. The only thing we are lacking in the Windy City are the exorbitant housing costs of Manhattan and the environmental disasters of Cali. And we have the Lake - how many of them do you really think are swimming in the Pacific Ocean? We've got sand and we've got sun; isn't that all they really need? Not to mention that just last year there were at least 2 major motion pictures shot in Chicago.

3. Southward movement. The South Loop is growing at an unbelievable rate considering the serious market constraints other parts of the U.S. are experiencing. Driving down Roosevelt Rd. you'll see more than 15 cranes putting up new buildings all in one 360 degree view through your car windows. And you thought developers were having problems? That wouldn't explain why Donald Trump is currently putting up a 92 story Trump International Hotel & Tower right downtown. Its close proximity to the lake, museums, Soldier Field, Columbia College, School of the Art Institute, Grant Park, McCormick Building, the Loop, 3 CTA trains, and major highways promises a thriving South Loop economy.

I wish everyone the best in keeping their New Year's resolutions. However, if all else fails, at least you still know you live in the best city in the world!

Bernanke-Panky

2007-12-11T13:38:00.000-06:00

The Fed meeting is today again, with market watchers eyeing whether rates will be cut by a quarter or a half point (0.25 or 0.5%). November job growth slowed (pointing to a larger reduction in rates), as shown by Friday's report, yet still exceeded forecasts (pointing to a smaller reduction in rates).

Since the Fed gets to decide on both the Fed Funds rate - the rate at which banks borrow funds from each other - as well as the discount rate - the rate at which banks borrow funding from the Fed - it's possible we witness a quarter point reduction in one and a half point reduction in the other.

Stay tuned...

On The Craziest Day Of Christmas...

2007-12-11T00:40:00.000-06:00

A quick recap of what is quickly becoming the largest bar crawl known to Wrigleyville: Nearly 4,200 people showed up for 12th Annual Twelve Bars of Christmas (TBOX) bar crawl which dominated all of Wrigleyville throughout the day (and night!) on Saturday. People dressed as gorillas dressed as Santas, Miller Light cardboard boxes specially crafted into Christmas-like sombreros, and more elves than the North Pole itself dominated Addison, Clark, and Sheffield throughout the day. And yes, it did start at 10 am. Luckily though, everyone came prepared - to stave off the early morning hunger, boxes of cereal were abundant. Hang onto those boxes throughout the night and you're guaranteed to be able to last all night long (especially with the really sugary kind...my favorite being Lucky Charms). Note the Capt'n Crunch sprinkled atop Zack's beer in the picture... no this beer-in-cereal concoction is not typical of TBOX; however, an interesting twist on the cereal concept that is famous to the bar crawl.

And yes, we got in early for this grand event. Of the almost 4200 people, my number was a very low 52. I took part in the festivities last year and knew it was going to become an annual event for me. So, add TBOX to the list of MUST DO things in Chicago during December. That is, if you can handle beer and cereal at 10am.

I only wonder how many Santa hats and snowflake decorations were strewn down the road early Sunday morning...

Snow in the Windy City!

2007-12-05T18:15:00.000-06:00

The ONLY thing I dislike about living in the Midwest happened to me this morning: scraping ice from my car windows while my fingers freeze. Honestly, it's the only thing I can't handle. But what can you do?... without the winter snows, we wouldn't have the gorgeous change of seasons which many other parts of the country lack.

So, I just try to enjoy it and forget about having to strap on my boots every time I leave my place. If that means blasting Mariah Carey's "Christmas" CD all day long, then so be it.

So, you wanna get into the holiday spirit but Mariah won't do it for you? You can't miss the following Chicago favorites:

1) The Walnut Room at Marsh..er... Macy's. Re-invented with a new wine bar in the dining room, families of all ages have traditionally come here during the holiday season to admire the massive Christmas tree and dine on anything from steak or chicken pot pie to walnut cookies. But beware... they don't accept reservations so get there early or expect to wait in the mother of all lines.

2)The Joffrey Ballet's Nutcracker. I saw it last year with a group of ex-ballet dancers and I can't stress enough how much a dance enthusiast will enjoy this. You may have seen it before, but it's always good a second, third, or even fourth time around. Heck, make it an annual tradition. 50 E Congress at the Auditorium Theatre.

3)Ice skating at Millennium Park. The plaza is replaced with a 16,000 square foot ice rink. Come by and show off your triple axel.

4)Winter Wonderfest at Navy Pier. More skating, trees, and lights. Basically a winter wonderland of fun!

5)Skiing down the wondrous West Loop Mountains! OK, just kidding. We all know Chicago probably couldn't get any flatter. However I have heard there are a few places you might be able to sled: (a)On Wilson, near Montrose Harbor, at Cricket Hill (b) The hill near Soldier Field, right near the lake path (c)A hill in the Beverly neighborhood. Sorry that's all I've got. You have more suggestions? Send them my way!

More to come...

10 Reasons to List Your Home During the Holidays

2007-11-23T13:14:00.000-06:00

1. People who look for a home during the holidays are more serious buyers!

2. Inventory drops during the holiday season, meaning less competition for your home.

3. Houses show better when decorated for the holidays!

4. Buyers are more emotional during the holidays and more likely to pay asking price.

5. Buyers have more time to house-hunt during the holidays!

6. Some people must buy before year-end for tax purposes.

7. Many people start new jobs in January... those new to the area will be house-hunting before they start.

8. You can be on the market and still have the option to restrict showings during the days you are celebrating at home.

9. You can sell now at a better price and provide for a delayed closing or extended occupancy until early next year.

10. By selling now, you have the opportunity to be a non-contingent buyer during the spring when there are more houses on the market for you to choose from!

Ideal for Investors!

2007-11-19T14:08:00.000-06:00

For anyone who has ever considered living or investing in the South Loop, I have a great deal for you. The Hanover Companies has created a very innovative program for real estate investors who want to purchase property in an area for use or sale at a later date who don't want to worry about finding and managing a renter. Their solution works for all parties involved. Here's how it works:

The Hanover Companies finds condo developers who are in financial trouble - those who need to SELL their condo units QUICKLY or else sink into even muddier waters. Hanover then strikes a deal with the developer to buy a bulk number of their condo units at a hugely discounted price. Hanover then turns around and sells to investors like you or I at going market rates. The incentive to you, however is such:

-Hanover will guarantee to rent your unit for TWO YEARS at a rental amount which generally covers your mortgage.

-Hanover PAYS YOUR PROPERTY TAXES

-Hanover PAYS YOUR ASSESSMENTS

-Hanover PAYS YOUR UTILITY BILLS (gas, water, sewer, cable)

-Hanover PAYS YOUR LEASING & MANAGEMENT FEES

-Hanover PAYS YOUR CLOSING COSTS

-Hanover gives you a TWO YEAR home warranty. For instance, say the furnace dies - it's covered. The ice maker in the freezer goes bezerk - it's covered. Etc. No worries to you.

This program is available in MANY developments throughout the country - Florida, Arizona, Vegas, Minnesota, and now CHICAGO! The Chicago development is called Vision on State at 1255 S State Street (State and Roosevelt), the heart of the South Loop and just steps away from public transportation and right next to a grocery store. There are 1 & 2 bedroom units available between $290,000 - $410,000. Parking is also available separately. These units are brand new (just finished in June), with granite counter tops, hard wood floors, balconies, washer/dryer hookups, and GREAT VIEWS. The building features a fitness room, business center, dog run, high speed internet access, and 24 hour doorman. There is availability up to the 19th floor. If you have any interest in the Chicago units, or others nationwide, contact me. Don't forget what an investment this might be if Chicago gets the 2016 Olympics where many of the events will be hosted VERY close to this location! See a picture from one of the units below.

Contact me for more information or to schedule a viewing of the available units!

OK, so a few questions you may ask:

Q: Do I have to use one of Hanover's lenders to qualify for this program? A: NO! You can use the lender of your choice. However, Hanover does have lenders you can work with if you like - you can get financing up to 90% with them.

Q: How do I know if the rental amount will cover my mortgage? A: The rental amount paid to you monthly = 8% of your purchase price divided by 12. This is USUALLY enough to cover your mortgage. Check with your lender to be sure.

Q: What happens after the 2 year program is over? A: From the start, the condo you purchase is yours. Hanover is only the tenant and does not have any ownership rights. After the 2 years is over, you can work with the current renter to continue renting the unit, you can use the unit yourself, or you can sell the unit. It's YOURS... do whatever you like with it.

Q: Can I get out of the program at any point? A: YES, however you must give Hanover 3 months advance notice for lease cancellation; some minor stipulations apply.

Q: They really pay my property taxes and assessments? A: YES. Taxes are paid at 1.5% of purchase price and assesments are paid. Simple as that.

Q: Are prices on the condos negotiable? A: Given that these are competitive going-market rates, the prices set by Hanover are not negotiable if you want to be a part of this program. Contact me if you'd like to see comparable properties in the market.

Q: What if I want to buy one of the condos but I don't want to participate in the 2 year program? A: You can still purchase through Hanover for 12% cash back at closing, should you choose not to take part of the rental program. Or, you can submit an offer to the developer. Contact me for more information.

Pocket Puppies

2007-11-07T19:18:00.000-06:00

So for the past 6 months or so I have had what some would call a large obsession with very small puppies. The ones that are like 1 pound. Especially yorkies. So, a couple of weeks ago I found what is now my new favorite store right in Lincoln Park. It is actually called Pocket Puppies Boutique and sells the fiesty little animals, along with all of the clothing you could possibly want to pamper your pooch like a real child. My favorite dog I saw there was a 10 week old yorkie that was 12 ounces!! It had already been sold, so much to my despair, I could not hold it. It was, however, sold for $2500, so I can see why its owner wouldn't want strangers tampering with its delicate little body. There were plenty of others available to hold, however. And hold I did.

The location of Pocket Puppies is at 2479 N Clark. For those unfamiliar with this Lincoln Park area, you should know that if you need to shop, this is a great place to go. I also noticed that there is a new coat outlet that just opened up on Clark, just south of Diversey. This place had coats galore and I will definitely be making another trip there now that I'm starting to remember how cold it gets in the winter here.

It's not just puppies and coats you can find on North Clark - you have plenty of boutiques, restaurants, shoe stores, purse stores, you name it.

And don't forget the best hangover brunch joint in town - Golden Nugget. The name of it alone is enough reason for you to eat there at least once in your life.

Of course my absolute favorite shopping area in Lincoln Park is on Armitage. Between Halsted and Clyborn on Armitage, you can find the best shopping in the area. Want the most delicious specialty chocolates you've ever tasted? Two different places will nurture your cravings. These are often popular for weddings and special events. Want to make your own purse? There's the Lisa Lill Studio, where you'll commonly find bachelorette parties. Want to smell fresh and clean? Lush will clean you up. Shoes? Plenty. Purses? Do you even have to ask?

So, if you've got a day to shop around here, give it a try. But prepare your significant other for the idea that you may come home looking like this:

Fed Ahead

2007-10-31T08:40:00.000-05:00

This afternoon the FOMC announces it's rate decision... will they keep the Fed Funds Rate at its current 4.75% level? Will they decrease? Increase? The market is pricing in a decrease in rates, however this will not necessarily mean a decrease in mortgage rates.

The Fed Funds Rate is a short term - overnight - rate. Mortgage rates are long-term - 15 years, 30 years, or even longer. Longer term rates are more affected by the outlook for inflation, rather than by overnight rates. The Fed has been more focused on turmoil in the credit markets and economic growth recently, since current inflation seems relatively tame, meaning the Fed is more likely to decrease rates (to help boost economic growth) than to increase rates (which helps fight inflation).

So, if the Fed decreases rates as it is expected to do, this will likely send stocks rallying, and the dollar falling. With investors shifting assets out of mortgages and into stocks and foreign investments, the likely outcome would be for mortgage rates to actually rise.

Resiliency in the Midwest Market?

2007-10-24T14:26:00.000-05:00

Today's economic information showed that the number of existing home sales decreased 8% in September from August. OUCH! And this happened to be even worse than what economists were expecting with a 4.5% decrease. Yes this did rock the market a little, with treasuries in a safe-haven buying rally, especially amidst some more unrest in the Middle East.

However, if you look at the data broken out by region, the Midwest has been more resilient than most to a decrease in home sales. While the number of homes sold in the Northeast dropped a full 10% for September, the number of home sales in the Midwest only dropped by 7%, better than the national average.

Even better, median home prices increased 1.4% in the Midwest, while home prices in the West dropped almost 9%, and the national average was a 4.2% decrease. So, while almost all other areas of the U.S. are seeing falling prices, the Midwest is still appreciating! And I appreciate that. :-)

A "Shining" Icon of Chicago

2007-10-16T14:06:00.000-05:00

If you live in Chicago, you know The Bean. For those not familiar with the Windy City, let me explain why one of the most popular Chicago landmarks is named after a legume.

The Bean, officially named Cloud Gate, is a 110 ton sculpture made of 168 stainless steel plates welded together and polished to an almost mirror-like finish. Designed by British artist Anish Kapoor, it reflects the skyline 360 degrees around it to create a beautiful icon of the city at the entrance to Millennium Park. The $23 million structure is shaped like - you guessed it - a bean, and was funded entirely through private donations. The original plan was to build it overseas and ship it to Chicago via the Panama Canal. In a likely smart decision, it eventually was decided to build the sculpture on-site in a tent-like enclosure. In a process which took 3 years, you can imagine the suspense the public felt at what was going on underneath that tent. There were several occasions where the tent was lifted to give the public a glimpse of what was going on underneath, but most of the construction was done out view of the public. In the picture to the right you see the structure beneath The Bean's shiny surface.

Standing underneath the concave center section of the bean can be likened to standing in the mirror section of a funhouse. I've tried many times to count the number of reflections of myself from The Bean's uniquely constructed "inside", but usually become frustrated around 30. On any given day, you'll find hundreds of locals and tourists posing, photographing, and praising the work of art.

Go North on Knolls, Turn at Knolls, Then Take a Left on your First Knolls

2007-10-10T21:47:00.001-05:00

I really felt it was necessary to post this picture. Can anyone tell me who DeKalb's city planner is? He really needs to review City Planning 101. We found this street sign in DeKalb while trying to find a friend's house on Knolls Street... needless to say it was not easy to find.

Mortgage Applications Numbers Explained

2007-10-10T10:48:00.000-05:00

MBA Mortgage Applications rose 2.4% last week... this compared to the previous week's drop of 2.7% seems like good news for the housing market. But before you jump to conclusions, however, let me tell you a little bit about how MBA Mortgage Applications are measured.

First, the MBA Mortgage Applications information is based on data received from retail lenders (generally your typical bank or credit union), but the number excludes mortgage applications from wholesale brokers (your LendingTree, Guaranteed Rate, etc.). You may be aware that many mortgage brokers recently have closed their doors amidst the mortgage market turmoil. This means that many customers who normally would have visited that broker have been forced to visit their local banking institution to obtain a mortgage, effectively increasing the number of applications that are counted. In theory there could be the same number of people applying for a mortgage, but many more of them are applying at retail lenders (which are counted in the figure) versus brokers (which are not counted in the figure).

Another item to note is the number counts all applications, whether they are approved or not. Say Joe Schmo goes into his local bank branch, applies for a mortgage, and gets denied. Maybe he does the same thing again the next day. And again the next day. All three of these applications are counted in the MBA Mortgage Applications number. With credit tightening, more people might be getting denied on their first application and going back a second time before they qualify, increasing the number of mortgage applications counted.

So while the MBA Mortgage Applications number is a little skewed, don't let that turn you off of the housing market.

It is a GREAT time to buy: housing inventories are at incredible highs, meaning that as a buyer you have many more choices available to you. Additionally, many developers and sellers have begun slashing prices to sell more quickly.

If you're looking to sell and then buy: while the average time to sell has been a little slower in this market, if you're priced correctly, you will be able to sell. Illinois sales prices are still up from this time of year in 2006 so on the average there are still profits to be made. Say, for example, homes just like yours are going for $15k less than you were hoping to sell for. Well, if you sell for that $15k less, you'll still make up for it on the other side - when you turn around and buy your next house discounted by $15k or maybe more!

26.2

2007-10-08T14:57:00.000-05:00

The air conditioning in my car is broken; a week and a half ago I figured I wouldn't have to worry about getting it fixed until next June. Was I wrong or what? This weekend was SWELTERING... enough for race officials to actually cancel one of the world's most famous marathons midway into the race. No, there were no world records broken in yesterday's marathon heat. Even just watching the Chicago Marathon from the sidelines, I could feel the trickle of sweat down my forehead. Eighty-eight degrees by 10am will do that to you.

What's going on? Maybe this whole global warming thing is hitting us faster than I thought. When I was a kid, I would spend hours of October outside shivering, bundled in my OshKosh B'Gosh jacket and carefully building what I believed was the world's largest pile of leaves, constructed only to break my fall from the picnic table as I jumped from it. This October I'd be better off floating on a raft in a swimming pool with a strawberry daiquiri in hand.

No matter the reason, it's happening. This October is no longer October - it's July. And this "July" there was one very hot marathon. About 10,000 runners didn't even show for the race and another 10,000 were unable to finish. One after another, I saw people struggle to cross the finish line only to collapse at the feet of those in front of them. Talk about determination.

The race always begins and ends right near Buckingham Fountain and usually attracts an enormous number of spectators and volunteers. Starting at Grant Park and going straight up north through Lincoln Park, the crowds can get up to 20 people deep to watch this morning display of will power. Get there early if you plan to cheer on your friends! An easy spot to watch the race is right at the corner of North Avenue and Sedgewick - however this area can get VERY crowded due to its proximity to the purple line. If you want to cheer somewhere that the runners would really appreciate and that you will have a better view, I'd head south. Also, don't expect to be able to watch the finish up close and personal. The finish line is bordered by bleacher seats reserved for those who have special tickets. And if you're going to be watching for someone specific, tell them to wear BRIGHT COLORS. Black and white don't stand out very well in a sea of 30,000 runners. And in weather like yesterday's, don't forget to bring your own ice cold waterbottle.

This year was the 30th anniversary of the Chicago Marathon and most likely the last year for its LaSalle Bank sponsorship. The well-known Chicago area bank has recently been purchased by Bank of America.

Baseball Season?

2007-10-04T17:31:00.000-05:00

Most say its baseball season. But I live on the north side of Chicago, so to me, it's Cubs season. Granted, baseball (and please don't stop reading my blog to punish me for saying this) has never been at the top of my "favorite types of entertainment" list. There are lots of things that I'd rather watch, like the Hawkeyes beating Michigan to win the BCS, or Project Runway for instance. But this time of year, baseball is more difficult to avoid than trying to find a group of sober college kids in Lincoln Park on Friday night.

So as you likely already know, the Cubs won the National League Central Division Championships last week. For most cities, you'd think this would result in several overcrowded sports bars, a long wait for a drink, and a couple of randoms using the world as their restroom. But for Chicago, it results in PURE MADNESS. The photo to the right is of the police brigade required to contain the complete chaos in Wrigleyville.

Now if you moved to Wrigleyville recently and like your peace and quiet, I highly suggest you make it your winter home. Any city that turns its police officers into full-blown equestrians for the sake of a game has a serious case of baseball fever. But don't get me wrong. I love that about this city. I love that the only time Cubs fans voyage south of Van Buren Street is to go to a Bears game. And I love that Sox fans think that 35th is the only useful stop on the Red Line. There are really only two words to sum up the attitude of sports fans in Chicago. Die Hard.