Market Conditions: Chicago February Sales Decline 13.8%; Median Price Rises Slightly YOY
The Illinois Association of Realtors is out with the February sales data.
As expected, sales continued to be weak, declining 13.8% year over year but median price actually rose slightly compared to last year.
Also, for the first time, the IAR broke out single family home median prices (as compared to attached properties) in order to highlight the year over year median price increase.
In the city of Chicago, February home sales (single family and condominiums) totaled 1,056, up 2.1 percent from the previous month 1,034 homes sold in January 2011 and down 13.8 percent from 1,225 homes sold in February 2010.
The city of Chicago median price in February 2011 was $177,500 up 0.6 percent compared to $176,500 a year ago in February 2010; the single family median price increased 21.9 percent in the month of February to $134,200 from $110,100 in February 2010.
Here are the sales statistics from the last 4 years:
- February 2011: 1056 sales
- February 2010: 1225 sales
- February 2009: 866 sales
- February 2008: 1412 sales
Median prices for the last 4 years:
- February 2011: $177,500
- February 2010: $176,500
- February 2009: $218,625
- February 2008: $290,000
“In the city of Chicago, both average price and median price have increased for single family detached over the same period in 2010. Buyers are finding significant value and gravitating toward the single family detached properties offering better financing options,” said Mabel Guzman, president of the Chicago Association of REALTORS® and a REALTOR® with Envision Real Estate LLC, Chicago. “Currently 90 percent of loans are government-sponsored enterprises, and with a 30 percent cap on condominium buildings qualified buyers are finding it more challenging to secure financing for their condo purchase. We are closely monitoring short sales in the city of Chicago, which are outpacing foreclosures, in order to track impact on communities throughout the city.”
Last March, as the tax credit was juicing February sales, Homedelete remarked:
“What will happen to volume as soon as the tax credit expires?
Who in their right mind would sign a contract on 5/1 rather than 4/30? The tax credit is merely shifting demand forward and volume will ultimately drop again.”
February Home Sales Up 1.3 Percent from January in Illinois; Year-over-Year Sales, Prices Still Influenced by Tax Credit [Illinois Association of Realtors Press Release, March 21, 2011]
Comparing sales to last year at this point is pretty skewed. At least we are running well above 2009 levels. I will say that contract volume is improving. But the % distressed properties is at record levels:
http://www.chicagonow.com/blogs/chicago-real-estate-getting-real/2011/03/distressed-home-sales-driving-higher-real-estate-activity-in-chicago.html
““What will happen to volume as soon as the tax credit expires?
Who in their right mind would sign a contract on 5/1 rather than 4/30? The tax credit is merely shifting demand forward and volume will ultimately drop again.””
That’s easy. Someone who doesn’t qualify for the credit due to income. You know, the kind of income that is required to buy at least 50% of the properties discussed here.
well I’m sure the % of distressed properties is certainly keeping prices down as most distressed properties are in bad shape and nobody wants to pay market price for something that needs work
Sales are going back to 2009 levels. Depending on how bad the double dip gets I would normally be worried that the tax credit will return in some form in the future.
Now that Republicans swept in November that seems unlikely now. However the 2012 election isn’t too far off and I could see those pigs at the NAR back at the trough for more in the future possibly.
why bob, because republicans don’t take assloads of money from the NAR?
LMAO! i suggest you take a look here.
http://www.opensecrets.org/industries/indus.php?ind=F10
Sonies:
There is a new breed of Republican after the 2010 election, dubbed the “tea party” type. If these guys stay true to what they campaigned on (never a given, but some likely will) they won’t be in favor of any more handouts. They are also putting the proverbial “fear of God” into mainstream Republicans who were used to the former status quo of tit for tat.
I didn’t really like the homebuyer credit, but I do think that it was the right thing to do. I also think that it encouraged some irrational decisions as people got amazed by the thought of free money, when in reality a lot of those people could have negotiated better or gotten a better mortgage and saved even more money than the credit, but these first time, younger and lower-income buyers generally didn’t know how to do that. Overall, I think that the lower end of the housing market would be in really poor shape if it were not for that credit, and I think that it stabilized the market.
If you could all the demand the credit accelerated, I think that we’re actually pretty health for sales when sales are only 14% off from that period.
“the single family median price increased 21.9 percent in the month of February to $134,200 from $110,100 in February 2010.”
The median SFH that sold in Feb-11 (and Feb-10) in the city was a run down bungalow in a below average neighborhood. $134k is the replacement cost for a tiny, tiny house, once you account for permits and excavation/demo and all the other sort-of-fixed costs, and assumes you’re getting the lot for free. At least 50% of the SFHs selling are, at best, marginally habitable.
“I could see those pigs at the NAR back at the trough for more in the future possibly.”
Hell, with the mortgage interest deduction and Fannie and Freddie on the chopping block those guys will be lucky to keep what they got. They’re peeing in their pants right now.
I’m in the market for a 2200+ sqft condo in Chicago in a newer building (2000+) that doesn’t have sky high assessments. The best deal I can find is in the $425/sqft range and many in the $550+/sqft range. Where are these great deals? I want something by the end of the summer and I can’t find a deal anywhere!
Can anyone point me towards a deal in any of these buildings:
55 Erie
Pinnacle
Bristol
420/450 Waterside
600 Lake Shore
415/445 N Water
1211 Prairie
340 Randolph
2 Delaware
505 McClurg
The only deals I can find are in old old buildings or newer buildings with crazy assessments.
“There is a new breed of Republican after the 2010 election, dubbed the “tea party” type.”
yeah wow bob those “tea partiers” all what, 3 of them? really made a difference in this year’s budget… a whopping 61 billion out of a 3168 billion dollar budget with a 1600billion deficit!
Yeah what progress!
not
It appears that the reported IAR median sale price numbers are incorrect for the fourth month in a row for the City of Chicago.
I track sales and medians from the MLS and have never seen a difference like this in median prices before.
Jul 2010 IAR $196,500 G $196,500
Aug 2010 IAR $200,000 G $200,000
Sep 2010 IAR $180,000 G $180,000
Oct 2010 IAR $183,000 G $183,000
Nov 2010 IAR $206,000 G $180,000
Dec 2010 IAR $199,250 G $167,250
Jan 2011 IAR $170,000 G $149,500
Feb 2011 IAR $177,500 G $150,000
Detached Only:
Feb 2010 IAR $110,100 G $110,000
Feb 2011 IAR $134,200 G $115,000
My sales counts are still basically the same as the IAR reported. I wonder how they calculated the median these past few months?
Steven,
1) It all depends on what you are looking for and how you define a “deal”. Interestingly, as bad as the market is, when buyers are looking for something they would actually buy the super deals just aren’t there.
2) You are looking at some premier buildings there and they have held their values much better than the market as a whole.
yeah its been happening since November, what gives?
I’m likely to buy a 3BR condo/townhouse this spring, but I want a good deal. Seems that a lot of sellers are still thinking they will make $100,000 profit on the place they bought in 2005.
“Yeah what progress!
not”
Regardless of what you think Sonies the mood in DC has shifted and a tax credit is not in the cards at least until 2013.
“yeah its been happening since November, what gives?”
New math? I have 1,063 sales in Feb 2011 with a median of $150,000. IAR reported 1,056 sales and a median of $177,500. I would have to remove the 150 lowest priced sales from my data set to move the median to $177,500.
Something ain’t right.
gary L,
i have a quick question, your professional opinion,
are your most recent clients coming in thinking its the time to sell things are getting better, are the coming in blind to what the market really is, or are the coming in with a good understanding of reality?
“I will say that contract volume is improving.”
Gary, you mean from Jan – Mar? Is that a surprise? I see YOY is down (no surprise, either.)
Otherwise, define “improving.”
Steven I am with you. What amazes me is that how the developer can retain practically empty building without discounting them. Last night we were getting back home I checked the lights again at MP west and it was nearly black.
I am tracking some properties and none have sold. In fact, every 3- 6 month they come down a bit in price, but nothing near where I believe they must be. So either I am way off or the sellers are : ) However, the fact that they are not selling makes me think might be them ; )
Gary,
Yeah it looks to me like the owners of the high end stuff just got together as a group and decided that they will not take a loss. They’re going to list high and demand a high price and I guess they have enough money to wait. Since the supply of the good stuff isn’t that high, I guess they may end up winning even if the economy doesn’t get any better.
G, can there be sales that are not recorded in MLS and hence your numbers are different? I really don’t know how this works but that seems like a plausible explanation.
No, I am only comparing my MLS data. Take a look at the months I listed above prior to November, that is how my MLS data matched IAR MLS data for years. Their source for Chicago is the same as mine, and, like I mentioned, their sales totals are still basically the same as mine (as they always have been.)
IAR. Garbage in, garbage out.
“Regardless of what you think Sonies the mood in DC has shifted ”
right bob, sounds like you’re believing in “hope and change” coming to DC
I have a bridge for sale, wanna buy it?
“Garbage in, garbage out.”
I don’t think that’s the case since they seem to be working off the mls data set (based on reported sales totals.) It’s their median calculation that appears to be, ahem, adjusted.
Anon(tfo) who exactly aare buying crappy bungalows in marginal neighborhoods other than investors?
Steven,
Just my opinion but I would personally not take “offers” and “possible selling price” as one and the same. I think in the properties you are discussing most sellers are pretty damn educated with what they are doing. They see the comps and aren’t going to list a few $psf either way from the others offered which is why everything kinda looks the same. But some sellers have to move and as much as people here repeat the concept of wealthier sellers not “needing” to sell I would assume it fair to say that there are guys that because they are wealthier “are waiting for any bid and just want out”.
I remember when I wanted out I just sat there waiting for any damn bid knowing full well once i got it I was hitting it. I would just go bidding and seeking out aggressive sellers, don’t think you’ll be able to make that read from a listing.
“are your most recent clients coming in thinking its the time to sell things are getting better, are the coming in blind to what the market really is, or are the coming in with a good understanding of reality?”
It’s all over the map. They fall in a few different camps:
1) There are some that need to sell and are realistic about the market and they can afford to take the hit.
2) There are those that need to get out but can’t afford to and don’t want to take the credit hit so they decide to rent the place out.
3) Then you have some that think if they pick the right realtor they will get more than their place is worth. They are obviously kidding themselves. There are a lot of places like these on the market.
My guess is these developers are now taking orders from their institutional investment partners and their banks. Banks aren’t marking anything to market on their balance sheets, I guess they don’t want to recognize losses here either? it’s been called kicking the can down the road. The fact that interest rates on these buildings are at historic lows makes the debt service somewhat easier to stomach.
The developers are just earning salaries and management fees as this point, there is no way the developer profit (the last ones to get paid) still exists as per their original proformas.
“Yeah it looks to me like the owners of the high end stuff just got together as a group and decided that they will not take a loss.”
House prices are still 42% higher than in 2000 per the CSI. Its going to take a much bigger drop from where we are now for another credit.
Also owning a home is a terrible financial investment:
http://finance.yahoo.com/tech-ticker/why-i-am-never-going-to-own-a-home-again-536051.html?tickers=PKB,XHB,ITB,EQR,KBH,MTH,HXM&sec=topStories&pos=9&asset=&ccode=
“Gary, you mean from Jan – Mar? Is that a surprise? I see YOY is down (no surprise, either.)
Otherwise, define “improving.”
You’ll notice that the latter part of 2010 did not fall off like the normal seasonality and started tracking closely with 2009. Now it’s tracking closely with 2010, which was helped by the tax credit.
G,
Regarding the data discrepancy. I’ve seen this before with MLS data and when I’ve reported it they found out that there had been an erroneous methodology change. Check the average and see if they are now calling average median.
“Anon(tfo) who exactly aare buying crappy bungalows in marginal neighborhoods other than investors?”
Probably nobody, which I guess was the subtext.
“House prices are still 42% higher than in 2000 per the CSI. Its going to take a much bigger drop from where we are now for another credit.”
Not sure what you are looking at. SFH in Chicago are only up 18% since the beginning of 2000.
Doesn’t James Altschuer pump Chinese Penny Stocks? Pretty sure he does on CNBC
Like he knows a damn thing about economics or “smart investing”
Tech ticker is chock full of know nothing, reaction baiting clowns.
Bob, I saw that article on Yahoo this morning. I was left scratching my head.
You have to live somewhere and your choice is to rent or buy. Either way it costs money. This article seemed to be written from a third point of view – free lodging. Maybe the dude is happy to just live in his parent’s basement.
“House prices are still 42% higher than in 2000 per the CSI.”
Where? The mythical house located at the average of everywhere?
Chicago is +18%, which is about an 8% real dollar loss. And the only real place (not “Comp-20”) that’s close to +42% is Miami at +43% (fine, Seattle and Portland are both at +38%).
And the National Index is +30%, which is awfully close to the +28.5% of CPI.
Gringo,
I low bid a couple developers and a couple individuals and basically got an FU response. I’m not hopeful that I’ll find a place.
Miumiu,
I spoke with the agents for 1211 prairie and 600 lsd. 600 lsd said the price was not negotiable and 1211 prairie said there was minimal room for negotiation. Both are pricing around $600/sqft. Insane!
“and 1211 prairie said there was minimal room for negotiation.”
When I went last September I was shown a unit that was about $350k over my budget. When I pointed that out to the agent she was saying they are very willing to deal, she made it sound like they have no problem knocking off 20% to 25% (which seems in line with some of the closed sales). Though still not a “deal” imo…
Steven,
If you really want to buy this summer then make a plan to put in two bids per week. Sure they can say what they want about minimal room and being non-negotiable but at the end of the day one will open up. I strongly suggest that you put those weekly offers in directly to owners and not to as many developers. You will get a yes sooner than you think.
Also you might reconsider an older building as there is more stability in owners that have been there for the long term and have minimal debt. Finally check out other neighborhoods. The South Loop and West Loop have some psf numbers that are well short of that number.
“You have to live somewhere and your choice is to rent or buy. Either way it costs money. This article seemed to be written from a third point of view – free lodging. Maybe the dude is happy to just live in his parent’s basement.”
He definitely was very much gung-ho on renting under any circumstances so I was skeptical. In places like Michigan where house prices are 35% lower than their 2000 levels I can’t help but think it’s cheaper to own but really haven’t done much research. I do know here in Chicago it costs more to own vs. rent currently, although with each passing month it seems that delta shrinks.
jp3,
There are maybe 3 places out there that I really have an interest in. I don’t think I could make 2 bids/week.
Is it likely that a lot of new listings will come out over the summer?
“I do know here in Chicago it costs more to own vs. rent.”
Generally speaking, that’s certainly true. But I’ve still not seen a rental that meets the Unicorn Criteria for $3k/mo.
More listings? Maybe, but the spring selling season has been underway for weeks now. I think sellers are waiting for a better market! Ha!
This bust will take another 5 or 10 years to finish. We are just in the beginning of the double dip….
The bust may continue for the next decade but that doesn’t help me now. I don’t see anything I’d be interested in renting.
Don’t worry the fed is working up some other sort of bubble right now… this one is either in bonds, commoditites or government
Steven: My sentiments exactly. I just spent a little time trying to see if there was anything comparable for rent to the place that I purchased several months ago, and there’s nothing. I did, however, see a couple of places I would have considered purchasing.
“More listings? Maybe, but the spring selling season has been underway for weeks now. I think sellers are waiting for a better market! Ha!”
I agree. I started looking in early January, thinking I’d have a good lay of the land, and be prepared to strike when more fresh listings started to appear. It’s been sparse. The few really nice properties have been way overpriced and are just adding to the stale inventory. Every so often one of the many orphan listings out there finds its match, but still few sellers or buyers from my perspective.
Steven- To me most of the buildings you are talking about trade like a commodity. Add a bit for this, take away a bit for that…. but $per sqft is fairly obtainable. Offer is simple to figure, last trade with just a bit of work. Maybe, as Gary said earlier, you can define deal, 7% off what you are figuring as fair value using last transactions? 10-15?
More listings always come on the market this time of year because the buying activity picks up also. I’ve been telling sellers to wait until about now to list. So there should be more availability.
In my little corner of the city a 2BR condo with moderate amenities will run around $325,000 to $350,000 with a parking space. At 20% down, your monthly cost (mortgage, assessments, tax) is going to be around $2400-2500. The equivalent apartment (with parking) is going to run $2700-2800 per month.
The numbers weren’t in favor of owning last year or any recent year prior to that.
It will be interesting to see what happens once the required 3 years of ownership that the tax credit imposed passes too.
It seems we’re always talking about the extremes (or at least the fringes) on here. Two recent threads about mansions in the most expensive neighborhood in the city, then another article presenting the latest statistical doom and gloom.
Bob2,
25% off 1211 Prairie list would get me interested. I looked at past sales and did see one that sold 80% off list last year. I guess I’ll head back to their sales office and see what they have to say.
“At 20% down, your monthly cost (mortgage, assessments, tax) is going to be around $2400-2500. The equivalent apartment (with parking) is going to run $2700-2800 per month.
The numbers weren’t in favor of owning last year or any recent year prior to that.”
This doesn’t make any sense at all.
1) You can write off the interest and taxes. That brings down the “real” monthly payment if you own.
2) Part of your mortgage payment is going towards PRINCIPAL. It is similar to putting money into a savings account (or some other vehicle that can go up or down in price). Without getting into an argument over rising or falling prices, you are paying down your mortgage, and you are left with an asset that you can sell to recoup some/all/none of the money you spent on mortgage.
It astounds me how many people make this comparison.
The market has picked up in the areas I watch, but it’s mostly lower priced SFH snapped up (presumably) by investors. Many long time listed properties have gone under contract recently. The higher end seems to be stuck. Fewer than 20% of the SFH have had price reductions in the last 30 days. Sellers are digging in their heels, again. Which means I’ll be renting another year…I read an article the other day about “birthday houses” in which you count how many ‘years’ a home has been listed in the MLS and celebrate the years….Kinda sucks actually, 2011 is looking to be another terrible years for the real estate market….what happens when most years are terrible years – does that make terrible the new normal? so are we actually in a normal market?
edit – I mean 80% of listing price.
“Generally speaking, that’s certainly true. But I’ve still not seen a rental that meets the Unicorn Criteria for $3k/mo.”
Everyone’s scenario is different and you are picky enough that you may indeed have to buy. I am far less picky, so obviously have more options.
The write off is only worth your tax bracket above what standard deduction – which in many cases isn’t all that much; and the declining home price argument is a valid one, especially if the value of your home drops faster than you can repay the principal
“#chukdotcom on March 21st, 2011 at 12:56 pm
“At 20% down, your monthly cost (mortgage, assessments, tax) is going to be around $2400-2500. The equivalent apartment (with parking) is going to run $2700-2800 per month.
The numbers weren’t in favor of owning last year or any recent year prior to that.”
This doesn’t make any sense at all.
1) You can write off the interest and taxes. That brings down the “real” monthly payment if you own.
2) Part of your mortgage payment is going towards PRINCIPAL. It is similar to putting money into a savings account (or some other vehicle that can go up or down in price). Without getting into an argument over rising or falling prices, you are paying down your mortgage, and you are left with an asset that you can sell to recoup some/all/none of the money you spent on mortgage.
It astounds me how many people make this comparison.”
After watching the market, and actively searching for over a year I have recently bought. I can attest to the dismal SFH selection in the Green Zone market.
If it’s a nice home it’s:
a) Overpriced- think 2005 price plus 5-10% to cover negotiations and realtor costs. Or,
b) Under contract within days, at close to asking – which was reasonable, and in line with 2002 prices.
Heck, even some of the super stale inventory is selling now, presumably because there is nothing else to buy.
Condos are a dime a dozen, and some can be found at great prices, but that doesn’t help a SFH buyer.
I’m sincerely beginning to believe that there is a shred of truth to what clio alleges: there are very few great deals that you’d actually be happy to own. Most SFH ‘deals’ are a mess, located in fringe areas, etc.
Although the government may be delaying the ‘bottom’ by blessing “extend and pretend”, loan mods, workouts, principal forgiveness, etc. I believe it’s having their desired outcome: no fire sale prices.
Take that for what you will. I just believe that the market for NICE SFHs in great locations will remain stronger than most people here think. And, no, I don’t think it’s fair to prop up any market, but here we are.
I don’t think this is ‘the’ bottom. But prices and interest rates are both down meaningfully. If you find something you’d like to live in, at a reasonable price, act quickly…
“I guess I’ll head back to their sales office and see what they have to say.”
If you do need a place by the summer, why not just make an offer at what you think is fair? If they dismiss your low ball just raise or move on. It’s the only way you’ll find out for sure whether they are willing to deal or not.
TB: what is going to happen, long term, to the overpriced homes? Of which is most of the properties out there?
The selection is dismal. Will it always remain dismal?
The market remains strong only because selection is dismal; and if sellers are waiting for a better market, well, what if a better market never comes?
“well, what if a better market never comes?”
While that question is best addressed to sellers, it’s also applicable to buyers to a certain extent.
I’m not advocating a complete “hey dude, I could get hit by a bus tomorrow, so why not live it up today” approach to housing choices, but for how long should one defer a better quality of (housing) life?
I’m so hosed…
homedelete –
My decision to buy was based on my need for a home (I’m not getting any younger), finding a place that was resonably priced (estate sale), and my sincere belief that the goverment will be forced to pull some stunt, or a series of stunts, to reflate….all at the expense of the US Dollar.
If I’m correct, there will be a day in the intermediate future when a Lakeview studio rental will cost $2000/month, a loaf of bread $20, $10 gasoline, and a VAT tax on everything.
As long as TBTB can prevent a massive flush of shadow inventory, I believe that prices will be prevented from freefalling. And, I believe no stunt will be too great to achieve this goal.
I could very well be wrong. Even if I’m right, you probably years time to find your home at a price that doesn’t make you puke.
BTW: the inventory for purchase is dismal, but I swear, the rental stock out there is even more depressing.
Meant to write: TPTB “The Powers That Be”, i.e. “The Man”. Typo, sorry
Steven,
I’d say that the advice from Bob2 was on the money. Make an offer and be prepared to raise once and or walk away. Then ask yourself why there are only three places you are interested in purchasing. Push yourself to look at other locations and properties or be prepared to have to “pay up” for such a specific limited supply of options for your residence.
that is a very good question. It is, I’m not being sarcastic. There is no good answer. I’m only going to make a finite amount of money in my lifetime and I don’t want to spend a good healthy chunk of it today or in the future on interest.
“I’m not advocating a complete “hey dude, I could get hit by a bus tomorrow, so why not live it up today” approach to housing choices, but for how long should one defer a better quality of (housing) life?”
“and the declining home price argument is a valid one, especially if the value of your home drops faster than you can repay the principal”
Is or was? No one knows for sure. One could make the opposite argument (increasing home price). The fact is, good or bad, it is way too important to ignore in the rent vs buy comparison.
“Check the average and see if they are now calling average median.”
This is what I concluded when I read their press release. It uses median in spots where you are expecting the word average.
jp3,
I’m picky. I know it. I’ve budgeted $1.2M and I think that I should be able to get everything I want at that price. But I am just not seeing much out there to choose from.
why don’t you guys buy a lot and build something I’m sure you could make something nice that you like for 1.2mm combined
I’m not interested in a SFH. I want a condo.
gary: “Check the average and see if they are now calling average median.”
I’ll check that.
JMM: This is what I concluded when I read their press release. It uses median in spots where you are expecting the word average.”
No need to check that. If JMM draws that conclusion, it is obviously wrong.
then what can’t you find for 1.2 million?
Unless you are being completely unreasonable, there’s plenty of condos out there with just about everything for a mil
CPS mailed lottery letters today! anyone got lucky?
We are #4 on the wait list in one of the schools – do we have any chances of being accepted?
“This doesn’t make any sense at all.
…
It astounds me how many people make this comparison.”
chuck.com…
I am really not sure what you are trying to say. Are you agreeing with me? Did you not understand what I wrote? I pointed out that in my area it appears as though owning a 2BR is better than renting a 2BR. And the average person at these price levels is likely to save no more than $100 a month in tax deductions, so I didn’t even bother.
“We are #4 on the wait list in one of the schools – do we have any chances of being accepted?”
Yes, you have a chance. Entry grade or later grade? Obviously much better chance at entry grade.
anon (tfo),
Thanks for the input!
Yes, entry grdae – K.
312 yes you have a chance. Call or stop by the school every two weeks. I’ve heard that sometimes principals throw out their lists in the Summer
“I am really not sure what you are trying to say. Are you agreeing with me? Did you not understand what I wrote?”
Sorry, I did misunderstand your conclusion. However, my points still stand. You will likely save much more than $100 per month in tax deductions. And my point #2 was my main point. If you assume a flat housing market over the next 5 years (which I think is reasonable), you would need to subtract our your principal payments out of that equation which would be around $400 per month. Using your example:
“At 20% down, your monthly cost (mortgage, assessments, tax) is going to be around $2400-2500. The equivalent apartment (with parking) is going to run $2700-2800 per month.”
Is really more like comparing $1800 to $2700-2800.
“312 yes you have a chance. Call or stop by the school every two weeks. I’ve heard that sometimes principals throw out their lists in the Summer”
Agreed. Especially on the continuing to check in over the summer, if you don’t get in before then. But, at #4, I’d say there’s quite a good chance of getting in in the official 2d round next month.
Chuck, don’t forget that there are transaction costs on both ends of a sale which don’t happen in a rental.
I think that the overall difference between renting and owning in this situation is smaller than you are making it out to be.
anon (tfo), dahliachi,
Thanks again!
Just called the school – no decisions are going to be made till April 1, but they told me that they went through wait list in previous years and I do have a chance. Interesting, I always considered myself unlucky in gambling and lucky in love. Didn’t even hope for the lottery in overpaid for condo in Lincoln Elementary district!
anon (tfo), my CPS-related research started after reading your posts here in CribChatter couple years ago. I really appreciate all the info I got from you. Thank you very much for your CPS input on this blog.
I agree with Steven, there are not that many nice condos with great views and good amenities and reasonable assessments. The truth is lot of sellers are holding on to their prices as long as they can and the buyers are waiting and not buying. Most of what is being sold is troubled properties which make ok investments and not necessary the ideal living spaces.
I think though many of these sellers are hanging from a thread, if economy does not improve or life’s unpredictable nature forces them to move, then they might become more negotiable. Alternatively, some buyers get tired of holding on and end up buying. My personal philosophy is that if I find a place I love, I will go for it as long as the price is reasonable (meaning don’t mind losing 10% of its value in the short term if I am happy living there), but I am not willing to buy something I think will go another 30% down.
“anon (tfo), my CPS-related research started after reading your posts here in CribChatter couple years ago. I really appreciate all the info I got from you. Thank you very much for your CPS input on this blog.”
You’re very welcome.
“I always considered myself unlucky in gambling ”
The majority of gamblers I know are unlucky in gambling. They’re also prone to over emphasize the wins and understate the losses.
312 – why don’t you just move to kenilworth, wilmette, winnetka, hinsdale or oak brook – where the schools are free and there are no lotteries, etc. – oh, and the schools are MUCH better than the VAST VAST majority of CPS – hands down. I am just amazed at the number of parents who CAN afford to move to these suburbs who spend countless days/weeks/months and so much effort to get their kids into a certain CPS because of the lottery, etc. when there are better, FREE and automatic entry schools in the burbs. How stupid can you be to put yourself through so much unnecessary stress? OK – let’s hear it……
“Interesting, I always considered myself unlucky in gambling and lucky in love. Didn’t even hope for the lottery in overpaid for condo in Lincoln Elementary district!”
I’m not sure what you’re saying there, 312. Are you saying that you overpaid for a condo in the Lincoln elem attendance area, but weren’t even sure if you’d win the lottery there? That’s confusing, because it’s not a lottery for folks who live within the attendance area (hence the term “attendance area”).
Or are you saying “I didn’t have to buy a condo in the over priced Lincoln attendance area, but my kid got into another great elem school via the lottery!”?
anonny,
Got too excited about the lottery and didn’t proofread, sorry. We bought a condo in LP to make sure we’ll get in Lincoln Elementary in Fall of 2011 and wouldn’t have to worry about the whole CPS issue. Decided to try the lottery just for fun – applied only to two schools and now #4 on the wait list to Disney. If the kid wouldn’t get into Disney, we’ll just send him/her to Lincoln – our neighbourhood school.
Clio,
For number or reason suburbs are not a good fit for our family.
We got our CPS selective elementary letter today, no gifted/classical school for us.
We’re currently in a top rated north shore suburban elementary but the fact that they admit everyone means they’re teaching to the middle of the pack, and leaving out the kids that are bored because they’re ahead of the rest. Plus – home ownership is pretty much out of reach for us out here. Sure we could afford the mortgage but when you’re looking at $12K taxes on a $150K 3/2 townhome that’s just insane. I’d rather spend a bit more to buy a condo with the same sq ft and pay a quarter of the taxes.
Isn’t Lincoln one of the best CPS elementary schools? Is Disney really that much better and worth the hassle of dropping off and picking up your child every day? I don’t know anything about Disney but if I was in the Lincoln attendance area I wouldn’t think twice about sending them there…plus they can walk to school!
Jennifer – Don’t you worry Rahm will get those property taxes to even out real soon! Buy the place you like but do not live in belief that the lower taxed city will stay that way forever!
“Sure we could afford the mortgage but when you’re looking at $12K taxes on a $150K 3/2 townhome that’s just insane.”
In what north shore suburb? You can buy a $400k house in Deerfield with $8000 taxes and get top rated schools. So I don’t see how a $150k townhouse could have $12,000 taxes (not yet anyway.)
312- Have you visited Disney?
“I am just amazed at the number of parents who CAN afford to move to these suburbs who spend countless days/weeks/months and so much effort to get their kids into a certain CPS because of the lottery, etc. when there are better, FREE and automatic entry schools in the burbs.”
If there were decent high school options- then I don’t think some of the CPS grade schools are the problem. But let’s say you live in Lincoln or Bell or Blaine. What happens when your child is 12 or 13? All the stress just starts up again.
And what if your child and his/her best friends get into a bunch of different schools around the city (public/private?) What a shame that is to split up the friends.
I do have to agree with Clio in that respect. As soon as you buy that house in the suburbs- you know exactly what schools your children will go to until college. There’s something to be said for that as well as city living etc.
“I agree with Steven, there are not that many nice condos with great views and good amenities and reasonable assessments.”
It all depends on what you view as:
1. “nice condo”- does this mean the kitchen has to have Viking, subzero, brand new cabinets? Does that mean it doesn’t need ANY work? As many of the short sales, especially, might need some updating.
2. “great views”- what does that mean? City? Lake? Combination of both? Some people like treetops and don’t want to be on the 80th floor. Others like city lights.
3. “good amenities”- again- does this mean a pool or just an exercise room? Or do you need a dog walking area, outside garden, yoga studio and spa?
4. “reasonable assessments”- people are mistaken about how much it costs to maintain the amenities (see #3) and what it takes to maintain doormen, flowers in the lobby, vacuumed hallways etc. Not to mention maintenance of the building itself. Do you know how much it takes simply to recarpet all the hallways in a building with 60 stories? Or to heat a garage with 200 to 400 parking spaces?
People are fooled into believing that assessments of new construction are what they will be 5 or 10 or 20 years into a building. They’re not. They’re kept artificially low. As the saying goes- you get what you pay for. Buildings with pools, rooftop decks and large exercise rooms will have much higher assessments simply because of insurance costs and maintenance.
Steven had a list of buildings he claims he can’t find anything in. The Bristol and a few of the others ones on that list have had a bunch of short sales (including on 3 bedroom units.) But if you’re picky and want perfection for your $800,000 or whatever- you’re not going to find it. You’re going to have to do work.
The Bristol has had a bunch of what I consider to be great deals for a building in that location and with those amenities. But it’s a bit older now and some people can’t handle the kitchens/baths.
I do have to agree with Clio in that respect. As soon as you buy that house in the suburbs- you know exactly what schools your children will go to until college.
I don’t even know how someone could take the chance. In my eyes, for someone with children, it should be a non-starter criteria. Bob disagreed with me once before on this but that doesn’t surprise me from someone who would spell their kids name John (notice the h) 🙂
Steven – check out The Fordham, 25 E. Superior. Great location,
not so oppressive pricing, I think.
Sabrina,
I’m in the market for a condo in one of the buildings I listed 2200-2600 sqft. S, E or SE views of lake & city on a higher floor 25-50. Assessments at 50 cents/sqft or less. Indoor pool and close to the tennis courts (the ones by water tower, millennium park or columbus drive/roosevelt) for ~1.2M. I would like an upscale kitchen but wouldn’t mind swapping appliances.
I can find 3 or less that I am interested in. If you know of others that are available now then please let me know.
desteve,
I’ve seen the fordham and was not impressed. SE views are nonexistent and the finishes are poor.
I also want a place that has deeded parking. Seriously, who wants to lease or valet parking?!? That really removes a lot of otherwise good buildings from the mix.
Sabrina,
What we want is as follows:
1. “nice condo”- Layout should be good. I don’t mind updating the kitchen as long as it was not overpriced and the seller is not pushing Amish style cabinets on us for a 600K 2/2 condo. I am fine with average SS appliances and don’t expect a 100K kitchen.
2. “great views”- I want city and my husband wants the lake….lol…I know classic married couple : )
3. “good amenities”- Definitely exercise and party room, pool would be a plus as I am a swimmer.
4. “reasonable assessments”- I don’t want to pay over 700-800 for our 2/2 per month. We want to own the parking.
That is why we primarily look at SL as it fits our budget. One reason I am stingy with the assessment is that this is an in town for us and I feel paying more than that does not make much sense for us.
So definitely we have a few criteria that we are optimizing over, hence not clear there is all that much out there that works for us. I for one love the north facing 2/2 in MPE and MPW and if they were around 600 (they are around 700 in MPE and 850K-1Mil in MPW) then we would go for it. Of course we can always sell our 1BR and then buy those, but I like to keep out 1BR as a rental.
Steven, we should totally get together and play tennis once we find our condos. My husband is serious tennis player too.
Steve:
The Heritage has everything you’re looking for and its newer construction. The pool is one of the best indoor pools in the city. Just phenomenal.
Great views (both city, lake and park). Lovely facilities. Near your tennis courts.
Tons of units available and many are in distress. Take your pick.
Here’s one we chattered on a few months back:
http://cribchatter.com/?p=9893
Buy one well under your budget and have a designer go in and put in new kitchens/baths and redo the place to your liking (if you don’t like the finishes.)
Doesn’t seem too hard to me. I’ve been in all the buildings you mentioned. If you have some vision most of them can be redone on the inside to various specifications. It’s just a square box, after all.
miumiu,
It’s a date but the tennis courts are more for my inlaws than for me. You’ll have to go easy on me.
1211 Prairie is pretty gorgeous both inside and out but it is in a bit of a bad location for me since I work north of the river. Plus, all the unsold inventory really scares me.
Miumiu: have you also looked in The Heritage? It’s a good location for an intown. The building is sold out. And, like I said, it has great amenities.
The 1550 square foot 2/2s have assessments in the $700 a month range so it’s within your parameters. A couple of interesting units are on the market in there- including one that has a private terrace overlooking Millennium Park. It’s in the $700s but you know what they say- everything is negotiable.
Sabrina,
The largest unit available in my price range is NE. I’m only interested in S, E or SE. Plus, 2150 is too small for me. Have any others?
LOL…Sabrina, have you considered getting your salesperson/broker license? Looks like you already have some clients!
50 square feet matters?
You might not get everything you want. You’re going to have to compromise. A SW facing big 3-bedroom just came on the market in 55 E. Erie for $1.35 million. Again- you might not get east facing. Oh well. Or you can just wait and see if something comes available in that building or others. There are always new listings.
No building is perfect. No property is perfect. People waiting to get everything- even in the upper bracket- can wait a long time.
Very few buildings have what you’re looking for. I wish you luck.
“Sabrina, have you considered getting your salesperson/broker license? Looks like you already have some clients!”
To deal with crazy clients who want the world in their price range? No thanks.
ha!
I already hear enough of the horror stories (“what do you mean I can’t get granite and stainless steel in my $225k starter home?”)
Sabrina,
Thanks for the suggestion actually I find 2 units that might work for us but they are still 100K over our budget. Still, I should go check them out and you did not lie about the pool!
Steven, I am 7 month pregnant so I think if we were to play now, you would have to go easy on me : ) I really hope you will find what you like. I am sure if we wait a bit, either we will find what we like or we will lower our standards, either way it will work out : )
Miumiu- the pool and exercise facilities are awesome. Like staying at a hotel. There is also a gorgeous 25th floor deck that overlooks Millennium Park that is open for residents and the view is spectacular at night in the summer. Really nice to go there and sit at the tables and take in the city lights (if you already don’t have a lake view in the building.)
Maybe I should buy in that building. ha!
Steven- you might want to check out 110 W. Superior (though it’s a smaller building so assessments are probably too high for you.)
That would be great Sabrina and we could gossip about ccer when we run into each other over over some nice dinner (I love to cook and have guests over)…hehe
Steven, I checked out 110 W. Superior and loved it. But the 2/2 was a bit cramped for us. My husband was not as crazy about it. I really liked the sales agent too, he was so nice and not pushy.
I am interested in the Mondial but would love advise as to the risks of buying when so few percent have sold. I haven’t really liked many other condos in comparison and part of me wants to just take the risk.
Any thoughts and advise are greatly appreciated
Jane, I don’t know much about that area, but have you seen this?
http://cribchatter.com/?p=8827
Sabrina,
It isn’t just the 50 sqft, but the view and from the room sizes, it looks like the layout isn’t ideal. Anyway, I had never considered that building so I will look into it. Thanks!
miumiu,
Yeah, I hear you. Good luck on your search too. The budget for my last place was less than half of my current budget and I had no trouble finding a place. I never dreamed it would be so difficult with $1m+ to find a great place.
110 superior doesn’t have a pool and isn’t close to the tennis courts. 🙁
” I never dreamed it would be so difficult with $1m+ to find a great place.”
Have you thought about renting? It might be a good option if you can’t find anything you like.
On the other hand, maybe you have to scale back your expectations. I know a lot of people on this site talk gloom and doom but most don’t realize that you really cannot get a 2000+ sq ft place in a good building in a good area for less than 1.5million. Maybe you should look in a neighborhood a little further away (prices drop exponentially the further you get from the gold coast/lincoln park.
clio,
A 2750 sqft unit was listed at Trump for $1.5m so I think my $1.2m should be enough to get what I am looking for. I think I am going to take Bob2’s advice and just low bid everything that comes close to what I want and use the savings to upgrade the finishes. If I can’t find what I want, I may end up renting.
steven,
I think Trump units are going to keep falling in price. If you are interested in that particular building I would definitely wait (and, if you don’t know already, I NEVER tell people to wait)!!!
Steven, did you see 415 E North Water St., Unit 2904? It has 2200 sqt and faces south. It was in your price range too. It seems to be under contract now. There’s another unit 1204, similar size, but it’s on the 12th floor. Good luck!
Steven, take a look at the Sexton 360 W. Illinois… there was a really nice corner PH floor unit there that I liked, not sure what happened to it but here’s another one from the same floor
http://www.redfin.com/IL/Chicago/360-W-Illinois-St-60654/unit-609/home/12738270
That is a nice building if you like timber lofts, not everyone does.
It does have a lot of space, amazing views, right across from EBC where you can play tennis and a lot of other stuff. Great little cubby in RN too where it isn’t too busy either
Thank you gary,
i was wonder if the new clients you were seeing “stars” in the eyes as this year would be “the year”.
thank you again for your inside perspective from the view of a pro!
“It’s all over the map. They fall in a few different camps:
1) There are some that need to sell and are realistic about the market and they can afford to take the hit.
2) There are those that need to get out but can’t afford to and don’t want to take the credit hit so they decide to rent the place out.
3) Then you have some that think if they pick the right realtor they will get more than their place is worth. They are obviously kidding themselves. There are a lot of places like these on the market”
“No need to check that. If JMM draws that conclusion, it is obviously wrong.”
So much data, so little analysis. If only G could synthesize something from all his data, actually make some money on real estate, he could move up from title examiner to a regular donald trump.
JMM- we see eye-to-eye on this one….
Having trouble reconciling:
“We’re currently in a top rated north shore suburban elementary but the fact that they admit everyone means they’re teaching to the middle of the pack, and leaving out the kids that are bored because they’re ahead of the rest.”
Which implies you think your kid(s) are genius (gee parents never think that).
With this:
“We got our CPS selective elementary letter today, no gifted/classical school for us.”
Maybe your child isn’t gifted? Maybe teaching to the middle is ok? It works pretty well for Sears. Yes, the admit everyone. Even those pesky WKW kids.
no JMM like my house my Timmy is special because I believe it so!
also,
i would like to thank anon(ufo) also, i ditto the sentiments 312forawhile stated.
your knowledge of CPS inter-workings has helped many of us on CC, we truly thank you for it.
“JMM- we see eye-to-eye on this one….”
Yet, my analyses have proven correct again and again. My detractors such as Clio and JMM? Not so much.
G, what analysis? You provide data only which is great of course. Also I recall you posted number about foreclosures on the south side and I posted another source asking you what do you mean by south side as according to my document 60611 had more foreclosures than 60605 and you never answered.
it’s not that difficult to look at numbers and make the right conclusion. it’s almost obvious on its face.
“G, what analysis?”
Clio, JMM and now miumiu. LOL.
“Also I recall you posted number about foreclosures on the south side and I posted another source asking you what do you mean by south side as according to my document 60611 had more foreclosures than 60605 and you never answered.”
Sorry if I missed something and offended your highness. Please point me to the comment in question and I will gladly provide a response.
Thanks Miumiu,
I have read the postings about Mondial on here, which have been helpful.
As a first-time home buyer I’m just nervous about buying and I’m not as knowledgeable about risks, etc especially for these new buildings. I have talked with a realtor “friend” but I don’t know how much to trust someone when they are so enthusiastic and encouraging me to buy.
“G, what analysis?”
i didnt know analysis was needed? the data he post pretty much speaks for itself.
take the data in this post, he shows the IAR may have changed from median from average, is there anymore info you need?
will “G” ever predict when a bottom will come? well his “guess” is just like everybody else even econ phd’s and my son.
shoot i can ask my son when will we see a bottom in the RE market his answer will be “one more cookie dada”. and that answer will be just as correct as HomeDelete’s prediction of “when we hit 1997 prices or 2015” and better than *the person who’s name i shall not mention* who predicted we are on the up swing because OB/Hinsdale/Winetka/Kenilworth are just fine.
so no analysis really needed, the data usually speaks for itself.
*now access to that data would be nice
groove, quit trying to post like anon… its confusing
“groove, quit trying to post like anon… its confusing”
great minds think alike 🙂 sorry i will go back to using all “” from now on
*well really his is not a mind, as he really is IBM’s Watson. (was i the only one who noticed his absence coincided with the taping of jeopardy?)
“take the data in this post, he shows the IAR may have changed from median from average, is there anymore info you need?”
No. My analysis indicated they are incorrectly calculating the median. It is not the average that is being reported, either. That is incorrect based on 2 incontrovertible facts: the actual averages and JMM’s track record.
“No. My analysis indicated they are incorrectly calculating the median”
SO THEY ARE JUKING THE STATS!!
nice lead by example thing they are setting.
Sonies,
360 Illinois isn’t the type of building I’m looking for but thanks for thinking of me.
Here is the link G to the conversation I was talking about:
http://cribchatter.com/?p=10096
As someone who actually analyzes data for a living, I have to still say that raw data even if valuable is not easy to visualize and can be misinterpreted if one does not correct for outliers, control variables and such.
You guys contradict yourselves with your comments. You disagree with my post saying G does not provide analysis by stating that no analysis is needed?! If no analysis was provided then I was right. Also G was the one who said he provides analysis so you mean he provides useless redundant analysis?
I am of the belief that his data is very nice and valuable, but the value is only in the analysis. Believe me you can prove and disprove the same hypothesis on the same dataset (as long as it was not trivial) depending on how you analyze the data, this is where clearly stating your methodology for making your deductions becomes so crucial. People can accept and reject the methodology and hence accept or reject the conclusions.
Moreover, if no analysis of the data is given people cannot visualize and interpret, hence means and medians and such are calculated. For instance, do you know why median is more meaningful that means for interpreting sales?
The answer is median is robust to outliers while mean is not. So one high end property selling at multi millions will skew the mean quite a lot but median remains more robust.
“Yet, my analyses have proven correct again and again. My detractors such as Clio and JMM? Not so much.”
Actually, it is pretty well accepted that you don’t provide any analysis. You provide publicly available information. That is not analysis nor is it really relevant to prove or disprove data. It is what it is.
You look at data differences and wonder why they are how they are without actually reconciling the differences. If you are suggesting the IAR is screwing up data, or worse, making it up, please provide support for this — tell us why you think that is the case. Yet you don’t know the answer nor do you really have anything insightful to take it a step further other than, it doesn’t match my numbers.
You take all this time to look this data up, yet cannot synthesize it to save your life. That is your track record. It stinks.
Actually G, I don’t believe I have ever see you go out on a limb and analyze your data besides saying the “there will be better deals in the future” shtick
you never say for how long, yet criticize those that do try to analyze data and make predictions, and for that, you are a tool
“So one high end property selling at multi millions will skew the mean quite a lot but median remains more robust.”
Tiered medians are useful for this purpose because all population medians don’t tell you much. But to this point, a classic under-reported story on this one:
“The Social Security Administration asked its inspector general to investigate how a $32.3 billion mistake skewed its statistics on 2009 wages in the U.S.
Two people were found to have filed multiple W-2 forms that made them into multibillionaires, an agency official said yesterday. Those reports threw statistical wage tables out of whack and, in figures released Oct. 15, made it appear that top U.S. earners had seen their pay quintuple in 2009 to an average of $519 million.
The agency yesterday released corrected tables that showed the average incomes of the top earners, in fact, declined 7.7 percent to $84 million each.”
http://www.bloomberg.com/news/2010-11-02/-invalid-multiple-tax-forms-by-supposed-billionaires-skew-wage-figures.html
Well in fairness to G, he calculated the mean and median of the sales for the period of discussion. I think IAR should clarify why their numbers defers from Gs if they are using the same dataset. I just assumed at the time maybe some of their data comes from non MLS resources, but G says that is not the case. I don’t know much about the process but G seems to know about its workings.
“it’s not that difficult to look at numbers and make the right conclusion. it’s almost obvious on its face. ”
That is a classic management trap. Trends are subtle and data is easily distorted.
“I just assumed at the time maybe some of their data comes from non MLS resources, but G says that is not the case.”
Or perhaps now some does whereas it did not before and there is a perfectly good reason for it based on some cogent analysis. I think that is a better explanation than, “error, does not compute therefore invalid, incorrect, possibly fraudulent” lol.
“Actually G, I don’t believe I have ever see you go out on a limb and analyze your data besides saying the “there will be better deals in the future” shtick
you never say for how long, yet criticize those that do try to analyze data and make predictions, and for that, you are a tool”
Really? You forgot about Gary’s erroneous bottom calling and my correct prediction of the exact month for a new CS bottom? How about JMM’s prediction of CS range bound at 120-130, and my correct call of lower? Surely you remember your knife-catching and my prediction that you could get something cheaper in the future? Hearing about your commendable frugality and your about-face on car ownership, wouldn’t it have been nice to have saved the equivalent of that purchase?
“Or perhaps now some does whereas it did not before and there is a perfectly good reason for it based on some cogent analysis. I think that is a better explanation than, “error, does not compute therefore invalid, incorrect, possibly fraudulent” lol.”
Keep trying to sound important, JMM. It amuses those who are actually informed.
From the IAR:
“Sales and price information is generated from a survey of Multiple Listing Service sales reported by 35 participating Illinois REALTOR® local boards and associations including Midwest Real Estate Data LLC for the period Feb. 1 through Feb. 28, 2011.”
“Keep trying to sound important, JMM. It amuses those who are actually informed.”
Cannot dispute or address my points so you resort to ad hominems. Very persuasive of you.
G if you think the IAR screwed up or is misrepresenting the data, wouldn’t you want to establish that in fact? Or at least reconcile the difference? It’s not like you don’t have the time on your hands.
“Cannot dispute or address my points so you resort to ad hominems. Very persuasive of you.”
The only point you seem to have made in this thread was incorrect.
Gary: “Check the average and see if they are now calling average median.”
JMM: “This is what I concluded when I read their press release. It uses median in spots where you are expecting the word average.”
JMM, your scattershot approach is not working, based on the quality of your cohorts.
What was my point? That perhaps averages and medians were getting incorrectly labeled? That was a suggestion, a possibility. How was it proven incorrect again?
Personally, my view is that is a lot better than your insinuation that the IAR is making up numbers. Possible, but I’d be prepared to back that up. Especially when all you have is a difference that you cannot account for.
I’ll vote for IAR just making shit up…. Pretty sure NAR got caught pumping up numbers a good 20% the past years. Sure IAR just as dirty.
“That was a suggestion, a possibility. How was it proven incorrect again?”
You stated it as a conclusion. I know for a fact it isn’t the average of mls sales.
“my view is that is a lot better than your insinuation that the IAR is making up numbers. Possible, but I’d be prepared to back that up. Especially when all you have is a difference that you cannot account for.”
Back to lying, I see. I only said that they are incorrectly calculating the median from the data set they still claim to use.
“As someone who actually analyzes data for a living, I have to still say that raw data even if valuable is not easy to visualize and can be misinterpreted if one does not correct for outliers, control variables and such.”
So do I. Actual real estate data. Lots of it. It amazes me why you think such basics need stating. Do you really believe it’s a gotcha moment?
“You take all this time to look this data up, yet cannot synthesize it to save your life. That is your track record. It stinks.”
Is “synthesize” the new adjective for new math?
G, I never thought it was a gotcha moment. Unlike majority of you guys who always try to prove your point, I actually enjoy learning from reading CC. Why do you always feel the need to attack?
I have numerous times said I don’t know about most neighborhoods, school system and so many other things even strollers that still baffle me…lol
Why do you keep calling me a snob, your highness and all? It seems you cannot accept anyone ever disagreeing with you. I mean grow up.
“I mean grow up.”
Ditto. Such is the life of a title examiner.
“I know for a fact it isn’t the average of mls sales”
I don’t see that you ever posted average mls data nor did you suggest at any point average data departed from your own calculations. If you are saying that is the case, please post the data.
Even if its not average, it could be a methodology change. But why speculate. Why don’t you pick up the phone and call them? You seem to have a lot of time on your hands.
NAR has the methodology posted online, it’s rather pathetic.
It’s good to have differences, we all learn by this. I am always grateful to hear from a professional who questions reported figures. Finding trends is a skill that can net large amounts of money…
“I know for a fact it isn’t the average of mls sales.”
NAR has just restated its data for the last several years (whoops!) and you don’t have to guess which way it had to restate it (down…of course.)
So- who knows what is going on with the IAR data?
No one will know unless someone calls them (or the press looks into and calls them on it.) Everyone just takes their data as the gospel.
But you do have to wonder if G’s data says the median is $150,000 and theirs says it’s $177,000- it’s a bit too big of a discrepancy for my tastes.
How does it affect psychology if the headlines in the papers say “prices up year over year” versus “median price falls another 5%”.
A LOT- in my opinion.
I have no idea whose data is “right” but, like I said, the NAR has recently come out and said “whoops” about a bunch of its own data.
“Actually G, I don’t believe I have ever see you go out on a limb and analyze your data besides saying the “there will be better deals in the future” shtick”
About 4 years ago on this site G was calling out knifecatchers even as they confidently asserted that in “3 to 5 years” they would be able to sell for more money. He warned there would be better deals in the future- and- well he was correct.
Ultimately, we’ll hit the bottom. But not before the current reality of 25% to 35% price decreases- even in the GZ- works its way through the entire market. And by then it may be 45% decreases – we don’t yet know.
G sees more of the data than I do but even the stuff I see is just devestating to most sellers. People who bought for $625k in 2004 selling for $500k in 2011. Massive losses everywhere. 50% (or more) of sales being distressed properties. These aren’t anecdotal stories- they are data points in the bigger equation. And it all adds up to some tough times ahead for sellers.
Things are only getting worse. Its nothing that lower prices won’t solve.
“Its nothing that lower prices won’t solve.”
I agree. If it is priced “right”- it sells almost immediately. I’ve been looking around in the suburbs and what is selling? The $60k house in Brookfield. The $200k house in Park Ridge. Lots of things selling on the way lower end (yes- to renovators/flippers etc.) But at least something is selling (and being fixed up.)
It’s really, really difficult in the $500k to $800k range. In the city AND the suburbs. Too much inventory at that price point. People complain here that I show too many new construction boring units- but there are dozens of those for sale in this price range.
HD, I hope you are right and I will get my dream condo. I feel the market is going to stabilize soon though except if lending practices get really tough (government stops helping home buyers) or if the economy goes south.
The question is where will the prices settle, 20% lower? even more?
I feel prime locations and non distressed established areas might be able to fight this off easier, but SL where I am interested in buying might still have some serious drops specially in prime buildings where the owners and developers have been holding on to their prices.
” Massive losses everywhere. 50% (or more) of sales being distressed properties. These aren’t anecdotal stories- they are data points in the bigger equation. And it all adds up to some tough times ahead for sellers.”
Are you kidding me? Seriously – the only thing ridiculous is this panic you are trying to create. I, along with SEVERAL other people have been scouring the MLS for “deals” in the green zone – we cannot find a single one. Sure there are foreclosures and short sales but most of them suck and most of them aren’t even that well priced. Everything else is INCREDIBLY expensive. You don’t have to take my word for it – check out 60611, 60610, 60654 (sonies, I didn’t forget you), 60614, 60657. It is ridiculous – and don’t go spouting nonsense numbers about closed sales – they are obviously falsely brought down by the disproportionate number of foreclosures that were bought by investors. Be smart – your readers are and they are seeing for themselves that the deals you talk of are nowhere to be found (well, in the areas that they want to live).
“It’s really, really difficult in the $500k to $800k range. In the city AND the suburbs.”
Sabrina, please look at what is under contract and also what recently sold in Lake Forest, Kenilworth, Winnetka, Wilmette, Hinsdale, Oak Brook, South Barrington, Naperville, etc. etc. and then tell me if things are “really really difficult in the 500-800k range)
“Sabrina, please look at what is under contract and also what recently sold in Lake Forest, Kenilworth, Winnetka, Wilmette, Hinsdale, Oak Brook, South Barrington, Naperville, etc. etc. and then tell me if things are “really really difficult in the 500-800k range)”
Clio- please look at all the listings under contract and what has recently sold in this price range in Oak Park, River Forest, Park Ridge, Edgebrook, Edison Park, Sauganash and tell me things are selling.
What you are seeing is the $1 million home being reduced to $750k to sell. The $750k house isn’t selling and those sellers can’t (or won’t) reduce to $550k to sell.
Some of the $650k to $650k homes are being reduced into the $400s now- and they are finally selling (if they CAN reduce to sell.)
But all this plays out in years time (unless they’re in distress and then you see a short sale/foreclosure fairly quickly.)
Many of these homes are on the market for years and years. Even in LP and Lakeview. Same $1.2 million dollar homes coming back (or still on the market) as last year. Same $800k homes in North Center. Few of them selling- unless they do significant price reductions.
It’s really hard in the $500k to $800k price range. Simply too much inventory and not enough buyers who have the downpayment (conforming loan is only $417k.)
Oh- I might add- look at the reductions in Western Springs, LaGrange and Clarendon Hills. The $750k homes are short sales and listed in the low $600s or the high $500s and STILL not selling.
Again- simply not enough buyers who have $150k to $250k (or more) to put down on these homes now. And they can’t move up from a prior property because they’re getting their b*tts kicked in that sale.
“I and SEVERAL other people have been scouring the MLS for “deals” in the green zone – we cannot find a single one.”
What’s a deal to you?
Is it the $1.4 million home now selling for $1 million? Because that’s what’s happening in LP now.
Is it the $3 million now selling for $2 million?
Is it the $650k condo in Lakeview selling for $500k?
Is it the $260k condo in Southport now selling for $150k?
These are the real world listings in LP and Lakeview right now. So I don’t know what you consider to be a “deal.”
Is the 4 bedroom Lincoln Park home on a leafy street selling for $600k? Not unless it doesn’t have serious damage or something else is going on.
Is it now selling for $1 million, down 30% to 40% from its prior purchase price? Sure.
“It’s really hard in the $500k to $800k price range. ”
ONLY IN AREAS WHERE HOUSES SHOULD NEVER HAVE BEEN IN THAT PRICE RANGE!!! What is so hard to understand about that?!! Houses in established areas (where housing has always been able to withstand economic downturns) are doing OK – again, it is only in areas that were falsely promoted and underwent dramatic upward pricing that are in trouble – and these areas SHOULD be in trouble. They never had the infrastructure or type of population that could ever sustain this type of pricing. Bottom line – if you want to keep your real estate money secure, please look carefully at the area in which you buy.
LP and Lakeview aren’t “established”?
Prices down 30% or more in those neighborhoods as well. Is that doing “okay”? I don’t know.
If a house is down 30% in LaGrange- is that “okay”? Is that area not “established”?
River Forest has always been pretty established. There are dozens of houses all over $600k to $700k on the market there. Are there enough buyers? Not that I can see. But I’m no expert on River Forest. The Groove would know more about how that area is holding up then me (as he sometimes links to houses from that town.)
Oh- we’ll have to add Highland Park, Deerfield, parts of Northbrook onto the list of suburbs where the sales are difficult in the over $500k range. Oh- and Kildeer, LongGrove, Arlington Heights.
I’m sure people can think of some more.
Clio- you’re basically arguing what many people here have been saying for a long, long time. Homes should only be $500k to $800k in very small pockets of Chicago and the Chicago suburbs. There simply aren’t enough buyers.
So in all those OTHER areas- prices will come down hard.
“look at the reductions in Western Springs, LaGrange and Clarendon Hills. The $750k homes are short sales and listed in the low $600s or the high $500s and STILL not selling.”
thats not true because it has to do more with the banks willingness to approve the sale price (and accept a writedown), not the willingness of buyers to pay an extremely discounted price.
most people won’t even bother with the headache when trying to purchase now. short sales are “wishing prices”
That may be true Sonies- but then it usually means its going to foreclosure then. Price will go even lower.
All I’m saying is that $700k is no longer doable in most areas- even LP and Lakeview. Sure- there are some selling at that price point. Of course. But way too much inventory for the number of buyers.
well that I can certainly agree on
whats happening now is that people that can afford to not move are not even bothering selling and staying put. Those that are forced to move due to affordability/family/job issues are going to short sale and foreclosure.
So that leaves typical mortgage buyers with a lack of quality properties to choose from. The only non-REO houses selling now are turnkey cheap gut rehabs or new construction on fire sales. Most “deal” REO’s go to investors for all cash deals because banks don’t want to bother with underwriting a mortgage. Short sales barely make it to approval let a lone closing.
It is going to take a very long time to clear all this expensive inventory in the burbs, as well as here in the city. The days of the 400k 2/1 and 700k 3/2 are long gone, unless its a real unicorn property
I never thought $700k was doable for most people anyways. Go back 10 years and see what $700k bought and comparable that to even today. $700,000 10 years ago bought a nice higher end property for a doctor, lawyer, accountant. Today $700k will barely buy you an updated cottage in Bucktown or Lakeview.
Even when you do the math on a $700,000 property, it requires some significant cash flow and a considerable down payment. That’s what made it higher end.
It was a game of musical chairs and then the music stopped. Now, everyone is stuck. It’s the renters who are banking their money consistently for the past 5 years who came out ahead.
It’s not surprising that the IAR would make up #’s as it is in their best interest to “convince” more people to do real estate transactions. In a few years a big scandal will come out over this one, but it will be just another story in Illinois…
G’s data seems compelling. Maybe we should write letters to the editor of the Sunday Tribune, or G can interview the head of IAR and ask about it, followed by a Joe Zekas interview as well.
“River Forest has always been pretty established. There are dozens of houses all over $600k to $700k on the market there. Are there enough buyers? Not that I can see. But I’m no expert on River Forest. The Groove would know more about how that area is holding up then me (as he sometimes links to houses from that town.)”
all i can say is River forest and kenilworth doors(prices) were not open to the groove family, but for some strange force (deflating bubble/market correction) these two towns have now been attainable to us and the funny thing in the past 3 years our income has been stagnant and actually less than three years ago since wifey stays at home with lil’ groove.
and remember these two towns where not created by the bubble they where high end and high priced before it, but still they are dropping like charlie sheens career (WINNING).
a crazy town that i thought was established before the bubble but looks like blockbuster going out out of business sale is Highland park. Areas block or to off the lake and block or two from ravinia are taking a buzz cut not just a haircut
I know nothing about nothing, but dang even i can see that EVERYWHERE took a hit, some worse than others.
Isn’t Architect the resident expert on River Forest?
“Isn’t Architect the resident expert on River Forest?”
he is my go to guy when i have questions about the town. (when he is around)
“$700,000 10 years ago bought a nice higher end property for a doctor, lawyer, accountant. Today $700k will barely buy you an updated cottage in Bucktown or Lakeview.”
It barely (slight exaggeration) got you an updated cottage in LV 10 years ago–recall the short-lot house on Grace from last week. Most of the fancy “high end” SFHs in the city 10 years ago started at ~$850.
“high end and high priced before it, but still they are dropping like charlie sheens career (WINNING).”
Groove, as with Sheen’s career, values up in those north shore burbs will be just fine.
“Groove, as with Sheen’s career, values up in those north shore burbs will be just fine.”
they will be “fine” i agree, but they have dropped. if i really cared about debating and (WINNING) a argument i would dig for some facts about affordability or something within those communities.
but alas i could care less about getting those facts and just provide my example that, yes the grooves can now afford to “get in” in these communities.
and seriously look at the carnage in Highland Park, a north shore community. i wonder how “fine” it will be?
It sounds like fortune is looking favorably upon you then, Groove. Were I at all inclined to move to the burbs, I’d certainly be looking at Highland Park (where I think a $500kish budget can, for now, get a smallish place fairly close to the lake, etc., whereas it might take a few hundred grand more to get something smallish on the east side of Wilmette right now). I’ve seen you advocate for areas on the far northwest side of the city before (I say “far” because I consider Roscoe Village to be on the northwest side of the city), places whose names escape me right now. If you’re willing to move to the burbs, why not Highland Park then? I know at least a dozen people who grew up HP. They all went to good colleges.
annony,
500k in Highland park can get a darn good home in the ravinia or braeside school district.
http://www.redfin.com/IL/Highland-Park/925-Judson-Ave-60035/home/14195243
HP is way to far from work for me, i am a believer that one should live as close to work as “possible”. but if HP was a “option” i would choose it over glencoe/winnetka/willmette as its bang for the buck is great (reason i drive a hyundai). and on the positve its NOT COOK COUNTY.
and the willingness to move to the burbs, well river forest is a inner burb and only like two/three miles from were i live now and kenilworth well was for the schools, we like the idea of one school from k-8 and being able to walk to it.
“It sounds like fortune is looking favorably upon you then, Groove”
sadly its other MISfortune that is affecting me favorably
also i do have to say, GET OUT MORE. thats why i love this city all the great hoods to visit and learn. if roscoe village is your NW side reference you are missing all that chicago (and some burbs) has to offer.
i travel all the way to the sw burbs for some polish highlander food and the next day will drive to jimmy’s hot dogs on grand and pulaski before hitting up felger park on damen and belmont.