Flipper Alert: Flipper’s Losing Their Shirts at 901 W. Madison

Some flippers in the West Loop are finding out that flipping isn’t always instant money. 

Take Madison 901 at 901 W. Madison in the West Loop.  This new construction building by Terrapin is 148 units.  Terrapin’s website says it is 80% sold.  Closings started in the Summer of 2007.

Currently there are:

  • 9 units for sale (on the MLS- doesn’t mean that Terrapin is listing all available developer’s units on the MLS)
  • At least 5 for rent

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The flippers in the building are feeling an enormous amount of pain.

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Unit #820: 2 bedrooms, 2.5 baths, den, 1600 square feet, southeast corner unit

  • Sold in August 2007 for $543,500
  • Currently listed for $579,000 (plus $25,000 each for two parking spaces)
  • Assessments of $533 a month
  • Joan Dim at Baird and Warner has the listing

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Unit #513: 2 bedrooms, 2 baths, 990 square feet

  • Sold in June 2007 for $339,500
  • Currently listed at $326,900 (parking $25,000 extra)
  • Assessments of $257 a month
  • Listing says it’s the cheapest two bedroom available in the building
  • No realtor has the listing (FSBO)

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Unit #701: 1 bedroom, 1 bath

  • Sold in July 2007 for $345,500
  • Currently listed for $284,900 (parking is $25,000 extra)
  • Assessment of $204 a month
  • Quest Realty has the listing

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Unit #703: 1 bedroom, 1 bath

  • Sold in August 2007 for $280,000
  • Currently listed at $284,900 (plus $25,000 for parking)
  • Assessment of $204 a month
  • Select a Fee has the listing

After you see numbers like these, it does make you wonder how many investors will even close on their units going forward in other condo buildings.

Madison 901 [website]

Chicagoland Home Sales Down 20.5% in 2007

The December numbers for the Chicago metro area are out.  From Crain’s:

Chicago-area home sales fell 33.2% in December, according to the Illinois Assn. of Realtors.

In the nine-county Chicago Primary Metropolitan Statistical Area, home and condominium sales in December totaled 5,033, compared with 7,530 in the same month of 2006.

For the year, home sales in the Chicago region dropped 20.5% from 2006, the association said Thursday in a news release.

This is an apples to apples comparison of what is happening now in the market.

The “buying season” traditionally begins after the Super Bowl.

Views of the River and the Ever Present Tour Boats

Maybe you’re like me and you’ve been on one of the river or lake boat tours that glide by all of the townhouses along the north side of the river in Streeterville and thought, “who lives there?”

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Now’s your chance.  One of the townhouses directly on the Chicago River is on the market.

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437 E. North Water: 3 bedrooms, 4.5 baths, 2 car parking

  • Sold in July 2003 for $1.42 million
  • Sold in September 2005 for $2.115 million
  • Currently listed for $2.225 million (includes the two parking spaces)
  • Private Elevator
  • Assessments of $1,474 a month
  • Prudential Preferred has the listing

Of course, this townhouse will now be in the shadow of The Spire, being built directly to the east.

Does Staging Matter? 600 N. Fairbanks

I’ve chattered about staging before but someone also recently commented how it was common to do in San Francisco but not so common here in Chicago.

Does staging matter?

Here is the same unit in 600 N. Fairbanks.  Both are 1746 square foot 3 bedroom, 2.5 bath southwest corner units.

Unit #1501 is minimally staged.  Unit #1901 is not.

Livingroom:

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Livingroom #2:

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Bedroom:

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Unit #1501 is currently listed for $1.1 million plus $70k for parking. Jameson Realty has the listing.

Unit #1901 is currently listed for $1.14 million plus $70k for parking. Prudential Preferred has the listing.

Flipper Alert: Prepare Yourself for the Deluge from The Marquee

The Marquee at 1454 S. Michigan in the South Loop is starting closings this month.  Prepare yourself.  The building was sold pre-construction at “affordable” prices.

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The original price range was:

  • 1 bedrooms from the high $100,000s
  • 2 bedrooms from the high $200,000s
  • 3 bedrooms from the high $300,000s
  • Penthouse units from the high $600,000s

Already, several of the penthouses are being flipped.

  • Unit #2405: 3 bedrooms, 2.5 baths, 2 car parking for $1.195 million
  • Unit #2403: 3 bedrooms, 2.5 baths, 1950 square feet for $929,900
  • Unit #2407: 2 bedrooms, 2.5 baths,  1800 square feet for $849,900

Sudler Sotheby’s has all of those listings.

Remember- these penthouses were originally sold “from the high $600,000s.”  I don’t have closing prices yet.

More interesting are the other three bedroom units.  These originally sold “from the high $300,000s.”

Unit #2201: 3 bedrooms,  2 baths

  • Currently listed for $795,900 (not sure if the two parking spaces are included)
  • Sudler Sotheby’s has the listing

But the developer is selling the same unit only a few floors down.

Unit #1801: 3 bedrooms, 2 baths

  • Currently listed for $511,900 (plus $35,000 for parking)
  • Koenig & Strey has the listing

The developer is still trying to sell some one bedrooms.  Those are priced starting at $270,000 (without the parking.)  Some of the two bedrooms from the developer are starting at $370,000 (without the parking.)

It’s going to be hard for flippers to flip for much more than what the developer is asking.  The developer is also giving away a $25,000 furniture credit.

Here are some pictures of the model unit:

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Stay tuned.  This building is going to be mighty interesting. 

The Marquee [website]

Foreclosures Popping Up in the John Hancock Center

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I haven’t talked about the John Hancock yet which is a bit peculiar as it is the world’s tallest residential structure (although it doesn’t qualify as the tallest residential highrise because it also has a commercial component.)  But that’s just facts and figures.  Whomever is living on the 92nd floor is living in the tallest condo in the sky (for now.)

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The John Hancock Center, at 175 E. Delaware on the Mag Mile, was built from  1965 to 1970.  It is probably Chicago’s most recognizable landmark.  It originally had 711 apartments.  The building was rental until 1973 when it went condo. It has less units now, as some apartments have been combined.  The residential portion of the building is on floors 44 to 92.

Units range in size from studios to 3/4 bedrooms.  Washer dryers were not allowed in the units but were on every other floor, I believe, but I’ve recently seen at least one listing that says that the building now permits them in the unit.  True or not?

There is parking, but it is rental next door to the building.

I’ve noticed a few foreclosures popping up in the building in recent weeks.  The most recent one:

Unit #7807: 1 bedroom, 1 bath

  • Bought in August 1999 for $250,000
  • Foreclosure auction price of $560,000

The units in the building are hit or miss.  Some haven’t been updated since the 1970s.  Some have been renovated beautifully.  Here are two examples currently on the market.

Renovated:

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Unit #5002: 1 bedroom, 2 baths, 1202 square feet

  • Sold in July 1996 for $178,000
  • Sold in July 1999 for $325,000
  • Sold in January 2005 for $369,000
  • Currently listed for $599,000
  • Assessments of $680 a month
  • The listing says it was a two bedroom converted into a large one bedroom
  • The listing also says “owner will buy down interest rate”
  • Koenig & Strey has the listing

Not renovated:

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Unit #5712: 2 bedrooms,  2 baths, 1300 square feet

  • I couldn’t find a previous sale price
  • Currently listed for $488,000
  • Assessments of $876 a month
  • FSBO on Select A Fee

Sales in the Hancock are surprisingly good.  There is still a cache to living in the building.  Talk show host Jerry Springer lives in the building, supposedly on the 91st floor.  Actor and comedian Chris Farley died in his condo in the building in 1997.

It’s still all about the views.  This is from Unit #5002:

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Struggling to Sell For Over $500,000 in Lakeview: 508 W. Melrose

There seems to be a certain price point that has really slowed in the Chicago condo market.  Included in that price point are two bedroom, two bath condos over $400,000. 

An example of the slowdown is evident in the listings at 508 W. Melrose, a 2004 new construction mid-rise building in Lakeview. 

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There are two units currently on the market.  Both have seen price reductions and have been on the market for months.  These sellers will be lucky to make any money on these sales (when you subtract agent fees, closing costs etc.)

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Unit #2A: 2 bedroom, 2 baths,  1568 square feet

  • Sold in June 2004 for $533,000
  • Currently listed for $549,900 (plus $35,000 for parking)
  • Assessments of $336 a month
  • Alan Zuber at Baird and Warner has the listing

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Unit #2D: 2 bedrooms, 2 baths,  1688 square feet

  • Sold in June 2004 for $512,000
  • Currently listed at $499,000 (plus $35,000 for parking)
  • Assessments of $261 a month
  • Rubloff has the listing

Flipper Alert: 600 N. Lake Shore Drive Gets Into the Game

Closings began in the last few months at 600 N. Lake Shore Drive, the first of Belgravia’s two high rise towers going up in Streeterville across from Ohio Street Beach. 

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A tipster told me that there was a clause in the contract that buyers couldn’t sell for a year after closing.  Yet some flips are starting to appear on the MLS and some of them appear to be under distress.  The seller of this listing for Unit #1704, a 3 bedroom, 2 bath unit with 2149 square feet, seems anxious.

It is listed at $1.2 million and the price includes two parking spaces.  Baird and Warner has the listing.

BELGRAVIA’S LATEST DEVELOPMENT WITH LAKE SHORE DRIVE ADDRESS! LOCATED IN NORTH TOWER HAVING UNOBSTRUCTED NAVY PIER AND OHIO STREET BEACH VIEWS! CIRCUMSTANCES CHANGED, UNIT BEING SOLD BELOW DEVELOPERS PRICING. CONTRACT MUST BE REASSIGNED W/IN 45 DAYS, CAN CLOSE AT LATER DATE. CAN STILL CUSTOMIZE KITCHENS & BATHS. CLIENT OPTED NOT TO USE DEVELOPER’S FINISHES. PRICE INCLUDES 2 PKG SPACES.

One flip actually has pictures so we can get our first view of the actual units. 

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Unit #2201: 2 bedroom, 2.5 bath, 1621 square feet

  • Sold in December 2007 for $768,500
  • Currently listed for $850,000 (plus $60,000 for parking)
  • Assessments of $492 a month
  • Baird and Warner has the listing

There are 12 units on the MLS with the majority of them being from Belgravia, the developer.  That’s probably due to the “no selling in the first year” clause.  There are two rentals.

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Unit #1905: 3 bedrooms, 3.5 baths, 2500 square feet

  • Sold in November 2007 for $1.582 million
  • Currently available to rent for $8900 a month (includes 2 parking spaces)
  • Rubloff has the listing

The other rental is also on the high end- at $7000 a month.  Perhaps those who can’t flip, will rent for a year and then try their luck at the game in 2009.

600 N. Lake Shore Drive [website]

The Cinema Lofts: Does Stainless Steel Matter?

I was struck by a listing I saw for a unit at the Cinema Lofts at 1635 W. Belmont in Lakeview.  The building was converted into lofts in 1997.

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It was for a 2 bedroom, 2 bath and it said, “prior to closing, new stainless steel range/oven, refrigerator and dishwasher.”

Do stainless steel appliances matter?

In the early to mid 1990s, white kitchen appliances were the norm.  In the late 1990s, black became popular.

But it wasn’t until the early 2000s that stainless steel became “in” and now it is a requirement in every new building.

If you have white or black appliances, should you switch them out with stainless steel before you even list your house or condo? 

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Unit #422: 2 bedrooms, 2 baths, 1501 square feet

  • Currently listed at $449,900 (1 parking space included)
  • Assessments of $374 a month
  • Kitchen has WHITE appliances but stainless countertops
  • Emerald Realty Group has the listing

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Unit #305: 2 bedrooms, 2 baths, 1357 square feet

  • Currently listed for $429,000 (2 parking spaces included)
  • Assessment of $302 a month
  • Kitchen has stainless AND granite
  • Connection Realty has the listing

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Unit #214: 2 bedroom, 1 bath

  • Currently listed for $427,995 (2 parking spaces included)
  • Assessments of $296 a month
  • This is the unit that says they will replace all of the appliances prior to closing
  • Rini Realtors has the listing

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Unit #508: 1 bedroom, 1 bath,  800 square feet

  • Currently listed for $285,000 (1 parking space included)
  • Assessments of $223 a month
  • Kitchen has WHITE appliances and no granite
  • PMD Realty has the listing

Rent versus Own: In Chicago, it’s still cheaper to rent

Crain’s recently focused on the dilemma many people have voiced here at Crib Chatter.  Should they rent or should they buy? Renting seems like the much better financial deal right now.

The general statistics also seem to confirm that renting is smarter right now.  From Crain’s:

Apartment rents are surging in the Chicago area, but that check to the landlord is still a lot smaller than a monthly mortgage payment.

Rent in the Chicago area represented just 60.0% of the after-tax monthly mortgage payment for the median home in the third quarter, according to a recent report by Deutsche Bank Securities Inc. That is up from 59.6% in the second quarter and a low of 58.2% in second-quarter 2006.

The article has a chart that is very interesting.

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Either rents have to really spike, housing prices have to come down, or mortgage rates have to come way, way down again. Or a combination of all three.

Deutsche Bank estimates that the Chicago-area market will get close to an equilibrium level if the median home price falls 10% from its third-quarter level and if mortgage rates fall a full percentage point. The Chicago-area median home price rose 2.5% in the year ended Sept. 30.

One way or another, the housing equilibrium will be reached. Question is: How will it get there?