Recipe to Sell a Property: Raising the Price? 143 W. Burton
In March 2008 we chattered about this 6-unit art-deco building at 143 W. Burton in River North/Old Town with two units on the market.
Neither one had been “upgraded” (i.e. no granite or stainless steel in the kitchens.)
Both were one bedroom units.
The units are still on the market. One has had a price increase. The other one has been reduced by $19,900.
Unit #2S used to have the parking included in the price. Now, the parking is sold separately and the price has been raised.
Unit #2S: 1 bedroom, 1 bath, 800 square feet
- Sold in November 2001 for $194,500
- Sold in August 2002 for $214,000
- Was listed in March 2008 at $260,000 (included the parking)
- Increased!
- Currently listed for $265,000 (parking is $20k extra)
- Assessment of $210 a month (special is paid)
- Taxes of $3,298
- No Central Air
- Berg Properties has the listing
The other seller appears to be more motivated.
Unit #3S: 1 bedroom, 1 bath, 800 square feet, penthouse unit with skylight
- Sold in June 2004 for $233,000
- Was listed in March 2008 at $249,900 plus 29k for parking
- Reduced
- Now listed for $230,000 plus $29k for parking
- Assessments of $210 a month
- Taxes of $3,406
- No central air
- $2000 closing credit to buyer
- Stellar Properties Inc. has the listing
By the way, these are the exact same interior and exterior pictures that were available 5 months ago.
3S looks nice, a change from all of the new construction stuff. I like the skylights and kitchen etc.
Can you imagine trying to negotiate with a seller who actually believed raising the price after receiving no bites was a reasonable thing to do?
I don’t think I could have the patience to deal with such people.
The owner is just trying to recoup the money he put in for bars on the windows.
Uhhh, there are no bars on the windows.
Very cool art deco building and looks pretty well preserved, but maybe in need of a little TLC.
wish the units were a little bigger.
In 2S, i am turned off by the DVD player and audio system on the floor, and the speakers set up incorrectly. But I’m just a tech junkie, so I’m sure that doesn’t matter to most. Kitchen looks brutally small too.
And what’s with a price increase? ugh…
$300/ft is expensive for this. They could make a nice duplex unit at the right price, tho.
Ugliest. Place. Ever.
A, I gotta disagree. Properly furnished, these units would be stunning. At least the building has an identifiable style and some really nice features. Problem is that neither unit owner took any advantage of them.
Love the deco steel windows, rare in Chicago. Duplex is a great idea. If you don’t get it, you are not likely educated in design/arch.
No, this place really is ugly. Those windows give off the feeling of living in a fish bowl or submarine. This place really is butt fucking ugly and I’m not talking about just the interior. This is ugly you cannot fix.
” I’m not talking about just the interior”
Your taste is in your mouth. But hey, I probably hate whatever it is you like, too!
They should raise the price to 1000/sqft. That will show those stupid buyers.
Duplex is an interesting idea, and fitting with the era – I can see a really cool curvey staircase. But, at only 800 SF each, with what you’d lose with the stairway I don’t think the value is there unless the price really dropped.
Well JB buyers better see the value quick because the price on this baby is only going up! Potential buyers, by hesitating, will only chase the listing price up on this one. 😀
Nevermind that the higher floor unit is cheaper. Ignore the wizard behind the curtain. The 3rd floor is soooo passe.
What do you think, $200 for each, and then another $125 to turn into a duplex and generally rehab? Is that even remotely doable?
Trusting Kenworthy’s numbers, $525K for what would become a 1400-1500 sqft space (stairs) is a bit high for the area. Not outlandish, but a bit high. As a polished duplex, I would think that it would sell at $500K.
I see that 2S notes that a special has been paid, but Sabrina didn’t make a similar comment for 3S. That could explain the price increase on 2S (the seller thought that it justified it) and the lower price for 3S. I doubt it, however.
“$525K for what would become a 1400-1500 sqft space (stairs) is a bit high for the area”
Defintely high, but with two parking spots. And still not at all practical, just kinda cool. I’m always wanting to turn these sorts of places into 2 or 3 townhouses.
here is an article from the Chicago Reader with a little history about this lovely little historical building! excellent history!
http://www.chicagoreader.com/features/stories/nest08/granddaddies/
there is huge potential here.
the last closing (only a few units in the buildings – not a LOT of turnover, so 2 up on the market is kinda rare) was in Sept. 07. 1bed/1bath – more upgraded – for 262.5k.
Getting each current unit owner to come down to $200K is wishful thinking. So, too, is only $125K for a total gut job to make these 2 units one unique duplex. You will need at least $50-$70K just to construct a new “normal” size kitchen.
I think the duplex idea–if done on the high-end and NOT on the cheap— would be stellar.
However, who would be dumb enough to pay $6500 – $7000 in taxes for a view of busy noisy LaSalle Street and butt-ugly Sandberg Terrace towers?
Good luck passing along a special assessment to a prospective buyer. Once you’re stuck with the hot potato that’s it: either you pay it, or lower your asking price appropriately to bundle it into the sale.
fo’RE:
Wrong building. Carl Street Studios is 3 or four doors down. THAT building is probably worth $300/ft or more.
also, where are the 6 (presumably) parking spots for this building? There isn’t enough space off the alley.
similar style, though!
i wasn’t clear about that.
sorryyyyy! you’re totally right!!!! of course!
me-post-too-fast-sans-re-read!
and, ya — more expensive and even LESS turnover in carl – like NONE. also super bad*ss.
“similar style, though!”
Only on the outside. I expect nothing is Carl is half as dreary as either of these.
We chattered about a unit in the Carl Street Studios last year. It DID sell but was on the market for far longer than you might think.
As for the parking, if you walk by the building you can see how there are six spots. The entire back yard is just parking- and some of it is kind of sideways. I don’t know how to describe it. You have to walk by the building and see what I mean.
which unit? How much was asking, and how much did it sell for? Unbelievably cool building… There are sixteen units; wonder how they doled out the parking? I would LOVE a unit in Carl St. Studios.
The Carl Street discussion appears to be http://cribchatter.com/?p=99
yeah, I reread the discussion–but can’t find record that it actually sold. Also some discrepancy on asking price (I think I saw it elsewhere asking 750,000). Just wanted to get the scoop…
Thanks to the Tipster who sent me the sales info on Unit #15 at the Carl Street Studios that we chattered about in September 2007.
It was originally listed for $750,000 and finished reduced at $699,000 (when I wrote about it.) It was on the market for several months at that price.
It NEVER sold. The listing was cancelled.
Looks like the seller also tried to rent it out for $2650. It doesn’t look like it rented, however.
Kenworthey- could be a great rental.
I’ve seen some of them for rent in the past. There are also units for rent in the studios that are on Wells from time to time (similar interesting layouts and multi-levels etc.)
Sabrina, is it just me, or are a shockingly large number of even the units that go under contract on this site, simply do not close and are cancelled? This Carl St. Studios one, that lovely Old Town unit, the converted church with the huge stained glass window…
In each case, the seller is right that their unit is utterly unique. In each case, they ask a whole lot, and in each case, probably *because* their place is so unusual, they manage to get a buyer. But in each case, it falls through. Why? I’m guessing that appraisers are no longer willing to play along like they used to with valuations.
I hope at least one of these owners decides to list for a price at which they can actually appraise… because it is only one of these unique units that might actually pull me off the fence!
Kenworthey,
The bubble brought a lot of yahoos into prospective real estate ownership. As lender standards return to sanity I think these people are only just now getting the message that they shouldn’t be buying a place that is 3.5x+ a multiple of their income. But there are still a ton of yahoos out there who can get ‘pre-approved’. This doesn’t mean approved.
Sounds right. But it does mean I think we should stop listing “going under contract” as “good news,” and waiting until closing to pop the champagne bottles.
Why do you suppose so many cancel instead of re-list? I guess because they are just renting it out until “the market turns around.” I know of at least one person who owns a beautiful million-dollar+ condo who is doing just that. She anticipates it will be two years. Is she right?
At least with renting their opportunity cost is low. Yes they are covering the difference, but for many this will be a fraction of the total carry.
The ones to watch are those who aren’t living in the residence and aren’t renting it. The cash burn rate on those is far higher than those who find renters or continue to live there.
Yes, her unit was empty for a year trying to sell, huge monthly losses. Now she she just found a renter for a two-year lease at a little less than PITI, with the hope that at the end the renter will buy, and the market will have turned around. For her sake, I really, really hope she’s right.
I love when FB’s try to play landlord and they learn how cruel, harsh and unforgiving life as a landlord can be. One bad tenant will cost you hundreds if not a thousand or more in attorneys fees; tenants will trash your unit; and you almost inevitablely will have a tenant stop paying…and if the tenant gets a lawyer the case can go on for a year or more; or in co-worker’s college roommate’s cash, he got sued for $12,000 for returning a security deposit two weeks late and for not providing a copy of the landlord tenant ordinance at the time of the lease signing…and tenants will call 311 on you in a heartbeat to complain about the smallest building code infactions (not enough outlets in the living room) and before you know it you’re at 400 W. Superior with the rest of the losers paying city hall a $500 administrative fine…but it’s all a billing bonanza for me. I tend to look at it as job security. There’s a way to make money in any market.
Kenworthey: What I’m hearing from realtors is that lots of “buyers” think that the game is the same as a year ago (or two or three.) They get “pre-approved” for a mortgage (which is the same as it always has been- which means you just need to be breathing) and then they put offers on units that are now, under the new lending standards, beyond their means.
So they get the offer accepted and then go to get a “real” mortgage and find out, whoops, they really don’t have that 10% (or more) downpayment and that many of the cheaper loan products are no longer available to them.
The contract then falls through and the unit comes back on the market.
That is what a lot of the agents are telling me.
Any agents out there that can confirm this is happening?
Also- it’s interesting that you bring up the fact that owners are choosing to rent out units and “wait”. We’ve talked about this a bit in the past.
I’ve seen this many, many times (especially in new construction buildings.) The flippers think if they wait a year the market will “improve”. But then, all of these owners will be listing at the same time- pushing up inventory even more when they do.
Perhaps someone should ask the flippers in Avenue East- who started closing about a year ago next month- how much “better” the market is for them if they’ve been renting for a year.
Heck, units started closing in 600 NF in November. Renters moved in in November and December. Will the market really be any better by then if those sellers try to sell?
Eventually, it WILL improve- but how many years will you have to wait?
SO many of these “accidental landlords” are sure that it will “improve” in only a year or two when there are thousands more new construction units still coming on-line in the downtown area in the next 12 to 18 months.
It’s all about the inventory and, so far, that hasn’t dropped dramatically.
I’m still waiting to see Chicago’s second quarter numbers (sales and inventories.)
Sabrina – Didn’t the agents who told you this conform it for you. I don’t see it in LP, LV, GC, or Old Town.
Sabrina, I posted some sales numbers last week.
Lakeview (area 8006):
June 2008 242 closed (-20% YOY)(-26% YOY2005)
2nd Q 2008 595 closed (-27% YOY)(-34% YOY2005)
1st Half 2008 957 closed (-22% YOY)(-29% YOY2005)
Lincoln Park (area 8007):
June 2008 111 closed (-41% YOY)(-46% YOY2005)
2nd Q 2008 300 closed (-41% YOY)(-44% YOY2005)
1st Half 2008 476 closed (-39% YOY)(-45% YOY2005)
Near North (area 8008):
June 2008 260 closed (-19% YOY)(-30% YOY2005)
2nd Q 2008 715 closed (-18% YOY)(-33% YOY2005)
1st Half 2008 1,302 closed (-16% YOY)(-41% YOY2005)
Here’s some history on Lincoln Park.
Year – June – 2nd Q – 1st H
1997 – 144 – 413 – 619
1998 – 156 – 438 – 686
1999 – 135 – 393 – 628
2000 – 135 – 390 – 637
2001 – 142 – 356 – 561
2002 – 138 – 403 – 619
2003 – 167 – 431 – 670
2004 – 186 – 452 – 727
2005 – 205 – 540 – 863
2006 – 163 – 439 – 679
2007 – 187 – 511 – 780
2008 – 111 – 300 – 476
My friend’s condo is on the Streeterville-GC border. Try telling *her* that the best neighborhoods are holding up just fine…
Sabrina – “Eventually, it WILL improve- but how many years will you have to wait?”
A lot of independent appraisers are coming up with a return to peak prices in most parts of the country in 2015. These companies have no other motivation than to make accurate predictions, as that is how they are judged. 2015 is a long time off to hold onto the hope of getting your money back on a condo you bought at the peak.
Japan is still waiting for a return to peak prices…17 years later.
Florida and California will still be not back to peak prices by 2015 or even 2018.
Anyone look at the jumbo rates the last few days. Not helping.
Thank you G. Your numbers are very helpful. I’m hoping to get the citywide ones though- especially the new construction sales. Did more than 200 sell (which was the number in the first quarter?)
It seems like there are LESS units under contract now in the new construction buildings than there were 3 or 4 months ago.
Bob,
That said, maybe peak prices will be returning to Chicago sooner than expected now that Chicago is officially (or primarily) the new Gotham.
Unfortunately the return to affordability will take years to play out. The SO and I have an informal game where we ride our bikes around various neighborhoods, pick out the houses for sale that we like and then ccrd them. My god sellers are still in la-la land. The average so-so homes are priced high and anything unique or distinctive is priced in the upper atmosphere. Those homes are also just sitting and have been for a while. People who bought in ’02 for $400k and are now asking $650k. I wanted to tell the guy that he’s two years too late; lower the price to $550 and maybe people will look at it. The market would be stagnant if it weren’t owners with large equity positions who price below market and bank foreclosures. Everyone one else is still clinging for the 50%+ appreciation in the last few years but few are willing to pay it. Seller are just gonna sit for years and years until they get their asking price. The market is going to stay low until then.
Homedelete: I’ve noticed the stalemate as well. Sellers with some equity who don’t “have to sell” are letting their properties sit at inflated prices and they aren’t selling.
But we’re coming to the end of Chicago’s peak “selling season”. If you don’t sell by the end of August, it goes downhill pretty fast until next spring.
After a year (or more) on the market, some sellers may start to figure it out.
Sure, some would-be sellers can “wait for the market to come back” if they want, but what about people who must sell soon? They will set the comps, and those comps will reflect the lower prices required to move the units soon.