Foreclosure Alert: Is River North the Better Deal? 33 W. Ontario
We’ve chattered about the distress sales at the Millennium Centre at 33 W. Ontario in River North numerous times before.
This recently listed bank owned 50th floor 2-bedroom unit has unobstructed views, hardwood floors, cherry cabinets and granite countertops in the kitchen.
From the pictures, it appears that the stainless steel appliances and the washer/dryer are still in the unit.
And this price includes the parking.
Given the recent auction at 1400 S. Michigan in the South Loop, could a foreclosure in River North actually be a better deal? This one is listed at $275 a square foot.
Vincent Scott at Sudler Sotheby’s has the listing. See the pictures and a floorplan here.
Unit #50D: 2 bedrooms, 2 baths, 1325 square feet
- Sold in October 2004 for $697,500 (parking included)
- Lis pendens foreclosure in July 2009
- Bank owned
- Currently listed for $364,900 (parking included)
- Assessments of $866 a month (includes heat, a/c, doorman)
- Taxes of $7086
- Washer/Dryer in the unit
- Central Air
- Bedroom #1: 16×11
- Bedroom #2: 14×11
- Living room: 24×16
- Kitchen: 11×9
$866/mo assessments = deal killer?
$1456 a month before paying mortgage? No deal!
This does bode well for my comps however (Assuming it sells) as my mortgage is about what the assessments + taxes cost in this building. Granted I paid more $ per sqft. But our building doesn’t have nearly as many forclosures or short sales.
if the assessments included electricity and cable/internet it would be alright, but if there are lots of problem units in the bldg. it will probability go up.
my guess it will prob sell.
Could you protest that property tax? And if so how long would it take?
You can appeal the assessment (not the tax) any year. The assessor sets the schedule by township, which gives you about a six week window to file an appeal. Proof of the purchase price is often not enough; you’ll need an appraisal to confirm it. You’ll get your result in a couple of months. If you aren’t satisfied with the result, it’s on to the Board of Review. With the head of the city’s dem party as the longest serving commissioner there, they seem to be much more agreeable to helping a voter out.
If you appeal during a reassessment year (it currently is for the city,) your new value will stay for three years.
Everytime this subject comes up, I write a book in response. I have learned that there are just so many intricacies involved.
I’ll leave it at this one: certain actions taken this year by the asssessor indicate that, regardless of whether your assmt remains flat or declines slightly, residential tax bills are going to explode next year. Enjoy paying more for our quality govt!
Renters, of course, won’t be feeling the pain in this deflationary rent environment. Deflating house values, OTOH, mean jack shyt for lowering tax bills.
“Deflating house values, OTOH, mean jack shyt for lowering tax bills.”
my tax bill went down $40 what kind of crazy you talking G? (that was sarcasim BTW and it really only went down 40 for the whole year)
“residential tax bills are going to explode next year. Enjoy paying more for our quality govt!”
why do you say that? they are reassessing at lower values and raising the % so it balances out or maybe a 1% increase.
Renters pay taxes too… just not directly
“why do you say that? they are reassessing at lower values and raising the % so it balances out or maybe a 1% increase.”
We all must pay for the sins of the past. Plus, the commercial market is on the edge of complete valuation collapse, and if they’re paying less, residential will pay more.
“We all must pay for the sins of the past. Plus, the commercial market is on the edge of complete valuation collapse, and if they’re paying less, residential will pay more.”
thats what scares me 2009 tax bill is good…. when we get the 2010 in the mail is what will be the scariest but we ha a long while before the mail man drops it off.
“We all must pay for the sins of the past.”
Don’t forget the sins of the future…
Such as the “friends and family fund for aldermen”
http://www.chicagotribune.com/news/chi-aldermen-payroll19nov19,0,280697.story
Or the serial arsonist who’s collecting a 50k a year fireman’s pension
http://www.chicagotribune.com/news/columnists/chi-kass-11-nov11,0,1832804.column
Or jobs and pensions for cops that beat the crap out of bartenders
http://www.chicagobreakingnews.com/2009/06/cop-to-be-sentenced-for-beating-bartender.html
Or credit card bills for dead guys
http://newsblogs.chicagotribune.com/clout_st/2009/11/daley-defends-scotts-credit-card-use-blasts-medical-examiner.html
Oh but don’t worry Da Mayer says its all over and won’t happen again..
http://newsblogs.chicagotribune.com/clout_st/2009/11/mayor-richard-daley-weve-cleaned-up-city-hiring-and-court-oversight-should-end.html
bleh…….
yeah February
“yeah February”
no the tax bill FOR 2010 not in 2010
“why do you say that?”
Anon nailed it. I consider it a perfect example of the unintended consequences of ‘extend and pretend.’
“Everybody knows” that the bottom for residential is in or near. Also, “everybody knows” that commercial is in total collapse.
I hope taxpayers enjoy hitting against a shift.
“Renters pay taxes too… just not directly”
Why should they be concerned where their declining rent payments go? LOL at the landlord “passing it along.”
“yeah February”
Nope, doomsday won’t come to the city until the reconciliation on the second half bill.
No, Groove, it will be the 2nd half bill for 2009 pay 2010.
yeah i am talking about the 2010 taxes which will be paid in 2011. as in the 2nd installment property taxes i JUST paid was for 2008.
great now i just confused myself.
Basically, the city/county has to generate whatever revenue they need so they are going to raise property taxes to get there. Now it seems to me that lots of people appeal their assessments and those that are successful get a smaller allocation of the tax burden so those that don’t appeal get a larger allocation. Moral of the story: if you don’t appeal you will get a double whammy.
That will be inconsequential, Gary. Residential has been way underassessed historically. Combine that with the currently accepted wisdom that “the bottom is in” and “extend and pretend” is a viable course, good luck on chiseling off a small reduction. In the meantime, comm’l props will be hammering away huge chunks of assessed value.
Don’t worry though, the green shooters can always say “whocoodanode” once again. Sheeple seem to buy that line of sh*t.
Massive Green Shoots!
http://2.bp.blogspot.com/_nSTO-vZpSgc/SwSWx2IcMWI/AAAAAAAAHVw/R0P0RNmO9wk/s1600/housing+starts+2009-11-18.png
groove I get it; were basically f-ed.
“groove I get it; were basically f-ed.”
i hear ya, crook county will be in full swing after elections watch everything go way up.
when the property thing happens, my house will be in my aunts name so i can get the senior exemption freeze. (FU todd stroger)
Groove,
I’m no tax expert but doesn’t that freeze merely freeze the assessed value and not the taxes? In other words, if they raise the rates, don’t you still get hit.
“doesn’t that freeze merely freeze the assessed value and not the taxes”
It does hit the assessment and not the taxes. There are two parts–a freeze and an exemption. Of course, Groove is already too late for 2009 taxes, b/c Aunt Mae needs to be in title before January 1 of the tax year.
So, Groove, if you’re doing it for 2010, get your stuff together fast.
good looking out anon and Gary.
i wouldnt do that anyway my property taxes are only a bit over 3k and 2009 bill will be 4k
Another Invsco disaster.
This building exemplifies everything that is wrong with RE.
I will NEVER buy in a high rise… besides being so cold and un-welcoming the assessments are always out of control.
At what price does this make sense from a cashflow perspective? $365K is too high, especially given $866/mth assessments and $591/mth taxes (which have surely gone up). Even with no mortgage, you need $1457/mth in rent just to break even. Units like this rent for $2500-3000/mth, so I just don’t see how the numbers work.
Maybe some fool buys it for $350K, but I don’t think it is worth it, especially with all the foreclosures in the building, which makes an increase in assessments a near certainty.
I think for 2bed/2bath high-rise condos to work cashflow-wise, they need to have really low assessments or be around $200K. There are some being sold in the south loop and west loop that may make sense, but most are still overpriced given increasing taxes and assessments along with decreasing rents.
Humboldt1, your thoughts are way out of expectations. I think this unit is one heck of a buy. Anything right now is for that matter. If regular folks don’t start buying, then the major investment funds are going to be stepping in next year and buying everything up. Its happening right now.
A lot of you posters are way to pessimistic still. Markets look forward. the stock market bottomed last winter. What more do you want? A free house given to you? At some point people are going to have to take on some risk again. There is no better way in doing so then buying a home. Ask buffet or any other veteran.
The building will probably recover with in time. If you have the cash to buy, your in a great position. Enough said.
Brent,
I think we are still not at bottom price-wise in Chicago. Lots of people who bought in 2005 and 2006 will see themselves unable to refinance in 2010 and 2011 when their ARMs reset and will lose their places to foreclosure which will flood the market. Realtors will tell you whatever they can to move properties so be careful.
There will be even better deals in 33 W Ontario in the coming months. I hope we bottom in spring but it may be even later.
Properties should be looked at as more than places to live and need to cashflow from a rental perspective to make sense for people like me who may live there for a few years and then will seek to rent it out. I have done this with 2 other places I own now and they do cashflow but barely (with 20 percent down on both).
Given all the foreclosures low assessments may be more important than low prices until more people get current on unpaid assessments.
Brent,
Do you own properties? I bought mine in 2003 and 2006 and have learned lots of things you won’t learn watching cnbc or listening to your realtor.
Of course I own properties or else I wouldn’t be posting these messages.
Humboldt1, I think your a pessimist and you’ll learn your lesson when the DOW is back at14K in a couple years. If you know anything about markets, they go up and down. real estate won’t stay down forever. Your obviously on the sidelines and have intention of buying anything else. Stop brainwashing these folks with your short sightedness. I have just as much to lose as you do if the market got worst.
the fed will probably unleash another stimulus and this thing will blow over. I would 100% be looking to buy. As long as you know you will have income for the next few years.
Its people like Humboldt1 who miss the bottom so they keep hoping the market goes back down just so they feel better. The trend is your friend. Markets have been pointing up for months now.
Humboldt1 is betting the whole world economy is going to fall apart and were all going to be living in caves. Get real.
Brent,
Your desperation is showing.
If you believed what you wrote then you would see that what you call brainwashing only increases your investment opportunities. That should make you happy, right?
In the event that you truly believe your nonsense, I’ll try to help you with a misconception. There are more possible outcomes to the correction than your fantastical V-shape or your straw man’s “living in a cave.”
Someone in a previous post from roughly Nov. said “we all know the bottom is near”. Nope, it’s not even close. Alot of sunshine is getting blown around, but, until unemployment not only stops but reverses prices will continue to fall.
Japan’s real estate peaked 25 years ago. How’s that for real estate always goes up? It’s going to be tough to top 2006 prices even 10 years from now.
Your absolutely wrong homedelete. China and India will lead the world out of this recession far faster than most people will believe. You will have a new technology boom here in America and before no time, we will be a producing country for China. Whatever real estate you buy will be fine. The population is going to keep growing larger at a significant rate. This means demand for goods will pick up. which means jobs(new ones also).
Its your guy’s money, do what you want with it. If you decide not to buy real estate or the home you want, someone else will. Its the way it goes. You can’t wait around and expect to pick a bottom.
prices don’t need to get back to where they were right now. The market is breathing and its healthy.
I’d buy anything you could right now, its all fairly priced. Buy when your ready.
“The market is breathing and its healthy.”
Then why is it in the ICU? Turn off the respirator and we can test this theory.
“I’d buy anything you could right now, its all fairly priced.”
“Fairly” is a relative term that is hard to quantify.
Regardless, whatever is fairly priced today will be more fairly priced tomorrow.
Groove,
Can you give me some details on the senior exemption freeze? How old do you have to be? Is that just for cook county?
Tom,
Called my momma and pops (who have the senior freeze), Its state wide and you need to be 65 years of age. they said it almost cut there taxes in half. taxes were only 4k or 5k i think before that (half is probably not realistic) If your looking to file right now you have to wait until January 18th 2010, something about the forms not ready until then they said.
If your a senior 62 and older that helps with utilities called “ceta” (sp) and a few other state wide discounts for the elderly too.
Brent,
I still own my 2 properties. I am not on the sidelines like you imply. I am looking to buy another, but am much better off if real estate starts to appreciate again. I don’t see that happening. I also have stocks and would love to see the Dow at 14K again, but 10K seems more realistic for the near future. I have hedged my bets and put $50K in bonds the last 2 years, while keeping my stock portfolio intact. I do have emerging market stocks in my retirement funds. I am in the process now of doing $50K 401K rollover from my previous employer (I am a commercial banker in Chicago) and will be placing much of it in bonds as well with some commodities per my broker’s recommendation to diversify (not gold as I am not a gold bug).
I hope I am wrong but think real estate may have another 8-12 months of declines price-wise ahead.
Brent,
I do agree with you on China and India and have invested money in funds that benefit from their growth. I don’t see the US as optimistically.
Where do posters think prices will be for 2/2 units in this building in the next 6-12 months? I think they may drop but assessments will pick up the monthly difference as they keep going up as more and more units foreclose.
I don’t see us repeating Japan’s scenario, but I do think the US will struggle for awhile.
On another forum, 2 years ago I called for a bottom price-wise in Chicago in May 2010. Let’s hope I was right. Unfortunately, it looks as if a bottom in price may be further off. Once the gov’t stimulus runs out in April 2010 (if they allow this) we will certainly see another downturn in housing prices, similar to the effect on car sales after cash for clunkers ran out.
MLS info on 2BR/2BA units:
There have been 5 closed since 9/1/09 (2 foreclosures and 3 short sales.) There is another short sale pending since 11/28/08. There are currently 17 available for sale, at least 9 of which are short sales or foreclosures. There are also 13 available for rent.
Prices are going nowhere but down from here.
Prices will stop declining in the spring of 2013.
My unborn children will have their own children before nominal prices reach where they were in 2006.
I am a landlord who is actually becoming a renter for the next 1-2 years while I wait out the housing market, renting a place in Oak Park. I have lived in the basement unit of a 4-flat I own in Humboldt Park for the past 4 years but have decided that it is not a suitable place for me to live with my girfriend. Hence, we are going to rent a place in downtown Oak Park (for only $950/mth, utilities included, for 1200 sq ft 1 bed, beautiful unit, hardwood floors, totally redone 3 years ago, granite counter, maple cabinets, nice fixtures). I rent out my 3 bedroom unit for $900 and my 2 bedroom unit for $800, in Humboldt Park and they are only 1000 sq ft. Works out pretty well. I get downtown on the green line in 20 mins and she can drive to work in Naperville in 30-40 mins (she currently lives in Aurora which sucks for me). I will continue to rent out my townhome in Itasca (comparable unit just sold for $181K in development I paid $215K for in late 2003, depressing). At least my $1500/mth rent covers my mortgage, tax, and assessments.
In the 4-flat in Humboldt Park, I am going to rent out the unit I lived in to existing tenant and expanding their living space. Works out well. I have them manage the building and only increase their rent a few hundred dollars/mth.
I will rent until I see some stabilization in the market and am now looking at single family houses as well as condos. I am 32 years old and may get married in the next 2 years and would be looking to start family in the next 3-5 years, so not sure if I need another condo. Plus, I think the River Forest/Oak Park is a great place to buy nice house with good schools and good access to downtown. We would be looking at houses $400-800K, most likely a foreclosure or short-sale and I think there will be some great deals. I have seen some nice stuff coming online in River Forest already, though $15-20K/yr for taxes is still too high.
Homedelete,
I agree that prices have more to go down, but maybe Spring 2011 for a bottom. 2013 seems pessimistic.
As far as nominal prices, eventually we will come back to 2006 levels, but it will be at least 10 years off.
Foreclosures that start today won’t be on the market for two more years. There are 11,000 foreclosures filed per diem in the US. Illinois is number 5 in foreclosures, behind CA, AZ, NV and FL.
Is it possible that tomorrow’s foreclosures will sell for more than today’s? Not likely.
Foreclosures will continue to depress prices for many years to come.
“I agree that prices have more to go down, but maybe Spring 2011 for a bottom. 2013 seems pessimistic.”
Home Delete,
If you are right and we do not bottom until 2013, I can always rent another 1-2 years. It is better than buying another place to see it drop 10-20% in value in the next year or two.
I still think Chicago will bottom price-wise in 2011, but other markets such as CA and AZ and FL will bottom in 2012-2014, as they have a flood of ARM resets coming up in the next few years. Foreclosures will continue to be a drag on prices in Chicago for awhile but ARM resets are not as big of an issue here.
I also think the bottom end of the market in Chicago (less than $250K) is within a year of stabilizing price-wise. The middle range $250-500K will take a little longer and above $500K will take even longer. The worst losses to come are comming for those in the jumbo range. I will look to put 20% down on my next place and go conventional, which will certainly give me a competitive advantage over the same guy who is buying the place with 10% down and going jumbo. This will happen with homes above $525K in the Chicago area (unless they increase FHA $472K limit).
I think places like CA, AZ, and FL will bottom first. They are attractable places to live and will always have a demand. Chicago and midwestern places will just stablize and prices probably wont move much. I think the places I mentioned are great buys now. No way CA prices stay down much longer.
Brent,
How much do you know about banking and the waves of ARM resets coming in markets like CA? I used to work for Citibank (still work in commercial banking) and I was relieved when we did not buy Wachovia and assume all the Golden West ARM mortgages (pick a payment BS). California will not be bottoming anytime soon, with all these resets which will force many, many foreclosures.
I agree that they have climates much better than Chicago (most places do), but all these ARMs are coming due. This will have repercussions for years to come.
buyers also need to factor in the fiscal disaster that CA is. only a fool would buy without taking that into account.
“buyers also need to factor in the fiscal disaster that CA is. only a fool would buy without taking that into account.”
Is Illinois *really* that much better off?
you guys are wrong, there is still a huge amount of wealth around the world so it wont matter if people still fault on mortgages. The foreclosures your all thinking about are in places in the hollywood hills or on miami beach front property. All of that will be swept up by other wealth.
There is no reason for housing to fall out anymore than it has.
Brent,
I wish the world was as great of a place as you paint it to be. Unfortunately, people are walking away in greater numbers all the time as they realize they are underwater (In Chicago too). Almost everyone knows someone or knows someone who has a family member/friend who has been foreclosed or is being foreclosed upon.
If I had not put 20% on my properties, I would be tempted to walk away too, take the credit hit and then buy again in 5-7 years. Instead, I continue making payments on properties that continue to decline in value on paper. Fortunately, I get rents to cover my payments but if I were to sell I would most certainly lose most if not all of the equity I have in the property (including the principal reductions I have made over the past 7 years).
Case Shiller of 110-120 for Chicago by mid 2011. Hopefully, we bottom in the next 6 months, but that is starting to look highly unlikely.
Brent,
Tell that to Japan.
Those who believe we have hit the bottom already must also believe that if someone bought a property in 2009 that they could sell it today for more.
Help us out here realtors: How many buyers would see that 2009 purchase price and offer more?
my place would sell for more.
I don’t think you guys understand. Foreclosure doesn’t carry the same meaning as it did 2-3 years ago. Everything is now considered to be “foreclosed’ or going into. That how agents are selling to people now. Your not buying at a discounted price anymore, prices have come off so much its insane in certain cases. Do some of you expect to be picking everything up next to nothing? There is always someone willing to pay more than something then you. I’ll say it again, if you hesitate to buy something because you think its not cheap enough, someone else will take it.
Japan is totally different. They have nowhere the natural resources and export we do as a nation. I’m not going to even get into it.
I don’t think you understand what foreclosure means. Google ‘shadow inventory’ and tell me what you think that will do to prices.
“#brent on January 11th, 2010 at 8:58 pm
I don’t think you guys understand. Foreclosure doesn’t carry the same meaning as it did 2-3 years ago. Everything is now considered to be “foreclosed’ or going into. That how agents are selling to people now. Your not buying at a discounted price anymore, prices have come off so much its insane in certain cases. Do some of you expect to be picking everything up next to nothing? There is always someone willing to pay more than something then you. I’ll say it again, if you hesitate to buy something because you think its not cheap enough, someone else will take it.
Japan is totally different. They have nowhere the natural resources and export we do as a nation. I’m not going to even get into it.”
Japan is “different”? Ever been to Tokyo?
By the way- Homedelete- your posting problem should now be solved.
Thanks Sabrina
“Japan is totally different. They have nowhere the … export we do as a nation. I’m not going to even get into it.”
You’re not going to get into it b/c one of your two points is WRONG. Japan’s per capita exports are ~$5800; USA’s are ~$4100. Total value of exports makes *NO* difference to what residential real estate might trade at–any link would be with per capita exports (and that’s tenuous, at best, when talking about USA, b/c exports are ~10% of the whole economy).
Brent,
A number of us know a fair amount about economics, specifically the Japanese economy. Many of us, who hold degrees in economics and work in the financial field (many of my clients issues letters of credit internationally and do wire transfers and currency hedging and trading). I do not see us as Japan, but do not share your optimism regarding the US housing market.
I see that thinks have gotten cheaper and have further to go. This shadow inventory HD speaks of is real. Many banks, including the one I work for, are holding back on foreclosing. I see this from the inside and many like HD see what is going on with their clients.
I was at Citibank for several years before joining my present financial institution and our mortgage guys were told internally to cut HELOC outstandings by half in 2008-2009. If housing had truly bottomed on a national level, banks would be more willing to lend on housing, let alone businesses in general.
I realize I’m posting on an old thread, but redfin is telling me that this place sold for 400k on 1/29/2010. Curious.
“I realize I’m posting on an old thread, but redfin is telling me that this place sold for 400k on 1/29/2010. Curious.”
Love it. Bidding war to buy into an Invsco-disaster building.
I think we will continue to see prices drop in this building, especially as assessments are sky-high.
Any updates on the building?
Clearly, we have yet to hit bottom price-wise in Chicago.
I was hoping for bottom mid 2011 but homedelete may have been more spot on with 2013 prediction.
You guys and your ill informed information. This building hasnt been an Invsco building for sometime. Its completely sold and the owners run the board. They have a more then healthy reserve, and the units that were foreclosed have and continue to be flipped…
Unit 31I is listed as a short sale for 235k. Its a 2/1.5 and not sure if any parking is included.