Apples to Oranges: Glencoe versus Bucktown
There has been a lot of chatter over the past few months about raising a family in the city of Chicago versus the suburbs. The main topic of conversation has been the schools.
But just what CAN you get in the suburbs now that prices are falling?
I think you just might be surprised.
Who would have thought that you could purchase a small home in Glencoe, not far from the lovely Glencoe Beach and in the New Trier school district, for a similar price as you could in North Bucktown, a few blocks from the Western blue line stop?
First, let’s look at what you can get in the Logan Square/Bucktown area.
This single family home at 2069 N. Oakley has been on the market since June 2008. It recently had a price reduction.
Here’s the listing:
Charming 1891 Bucktown cottage with lovely professionally landscaped yards. This 2 br,2ba home has maple fls,white country kit,and separate formal dining rm. The 25X19 master suite has catherdral ceilings,gas fp,skylights and French doors opening to a balcony.
Full basement with w/d. Dual zoned HVAC. Deck off kitchen and a 2 car garage. Walking distance to El. Perfect for your condo buyer ! No Assesments
Joanne C. Gross & Associates has the listing. See more pictures here.
2069 N. Oakley: 2 bedrooms, 2 baths, 2 car parking, square footage not given
- Sold in March 1992 for $105,000
- Sold in July 2003 for $413,000
- Originally listed in June 2008 for $524,900
- Reduced
- Currently listed for $499,900
- Taxes of $4,073
- Central air
Here’s the listing for 250 W. Greenwood in Glencoe:
Storybook Tudor that will enchant you from entry to exit. 3BR up/ 2.1 bath Arched doorways, Mahogany beamed ceilings, Hardwood floors, French doors opening to the dining room, WBFP in the LR, separate Breakfast room off the galley kitchen w/ commercial grade SS Wolf range & salamander grill, gingerbread entry into the kitchen. Walk to HW, town, Glencoe schools. Create your own story, renovate or move in!
Marlene Rubenstein at Baird and Warner has the listing. See more pictures here.
250 Greenwood Road: 3 bedrooms, 2.5 baths, 1.5 car garage, no square footage given
- Sold in September 2001 for $443,000
- Originally listed in August 2007 for $665,000
- Reduced several times
- Was listed in August 2008 for $598,000
- Reduced several times
- Now listed for $499,900
- Taxes of $12,297
- Space pac cooling
at some point, prices in desirable city hoods flew by those in desirable suburbs. I don’t know when it happened but examples like this are kind of shocking.
I grew up almost next door to this house. Great neighborhood, great location near Tower Rd, Central School, uptown etc. Shockingly low price. Something must be wrong with it.
105k->499k. LMAO. This is truly a real Chicago Home of Genius.
Which tattooed, pierced service sector/creative type 20-something is going to buy this? I guess a lot must play the lottery.
Not all suburban bubbles have popped. There are still $700k 1960 split levels in Glenview three or four miles west of this house.
Also, the taxes on the Glenview house are killer.
Sorry, taxes on the Glencoe are killer.
“taxes on the Glencoe are killer”
You’re paying for the certainty that your kids won’t have to go to private school.
“not far from the lovely Glencoe Beach”
True in a suburban sense, but it’s over a mile as the crow flies, so more like a 1.5 mile walk–like saying SoNo is “not far” from North Avenue Beach.
“105k->499k. LMAO. This is truly a real Chicago Home of Genius.”
Oakley and Armitage in ’92 was a *really* sketchy area. It probably would have rented for ~$750/month. Doesn’t make it worth $500k now, but it’s been fixed up and the neighborhood has almost totally changed.
“Was listed in August 2008 for $598,000
Reduced several times
Now listed for $499,900”
WOW–$100k off in less than 2 months! **That** is what we should see from actually motivated sellers.
wow that glencoe house is cheap! (although i’m sure it’s small that the pic makes it appear) it is amazing how the city has leap-frogged over even the most desirable lakefront suburbs. It’s a major demograhpic shift.
How many million dollar (or equivalent) homes even existed in the city 20 years ago? Now they are all over not only Gold Coast and Lincoln Park, but alsoLakeview, Wicker/Bucktown, Lincoln Square, etc. The new upscale city buyers are people who in the past would have just moved to burbs. So to the extent that upscale housing is in demand is rising in city, it should be falling in burbs more or less.
I visited this Bucktown home a couple of months ago and spoke with the owner. At that time, he said he had shown it over 20 times and has had no offers. He also admitted he has done very little to the place since he purchased it five years ago.
This home is very, very small and could use some work.
How would the property taxes for the Glencoe house compare private school tuition in the city? Other factors like car insurance, etc. would also need to be factored into the full equation, too.
This doesn’t surprise me one bit; you can throw a stone down any street and hit a “For Sale” sign in the North Shore these days.
That Glencoe home is lovely. Those ceilings are gorgeous.
Part of the reason that the Glencoe house is so cheap is because it’s in a very non-desireable part of Glencoe. If the house were east of Greenbay Road, the price would be significantly different. I’m not saying it’s in a “bad” area, but it certainly is not in the better part of Glencoe.
Great post, Sabrina!
Husband and I are currently renting in the city, but plan to buy in the next 1-2 years. We originally thought we’d buy in the city and then move to the burbs after about 5+ years when the yet-to-be-born children approach school age. Given the state of real estate, though, it may make financial sense to just move straight to the suburbs (as hard as it may be on us to miss those city years) to a home we would plan stay in for a decade or more.
Posts like this highlight something that I’d started to notice – – that you can get a small house in Wilmette for about the same as you can in Logan Square. Granted, there’s a more on the low end in LS and taxes on the North Shore are astronomical. But, you can buy a solidly-built 3-4 bedroom in west Wilmette for around $500k. A lot of money sure, but not the premium I would have expected before I started to look.
If you sent your kids to Sacred Heart or St Ignatius, you’d be paying $12,000+/year in tuition plus further fees and contributions. If you went Parker/Latin/Lab prep school route, you’re paying more than $20,000/year all told. Bucktown means private school unless your kids win the magnet/HS prep lottery – and the competition is fierce, and about to get far fiercer as those private school tuitions become much less affordable in today’s bad economy.
So if you have a school age kid and you buy that Bucktown house…you’ll soon wish you had opted for Evanston, Oak Park, or even Naperville when you’re writing those enormous checks with after-tax monies to pay for private school for 12 years. Our many friends with kids who live in Chicago all uniformly were shut out of the magnet schools at kindergarden, are paying for 9 years of private school tuition, and are wistfully hoping to “win” a spot for Northside Prep, Peyton, or Whitney Young.
Taxes in the “good school district” suburbs tend to be VERY HIGH. I’m in River Forest in a smallish but picturesque 4 bedrm/3 bath brick house. We will pay $16,000 (2007)in 2008 RE taxes for a house worth $700,000 in 2002. My 2008 property valuation assessment was increased to “$880,000!!” value without any capital improvements, even as I think the house is probably worth $700,000 today if we’re so lucky. So in 2009 we’ll probably pay $20,000 for a house that needs serious remodeling and constant upkeep.
Why are we here? We moved here for the excellent elementary school system, and receive a private school education equivalent with many special education services readily provided for our child. (For an attentive student, OPRF High School is also an excellent choice.) Yes, I’m tolerably happy with the choice, because I view RE tax as “tuition equivalent”. But we’ll move after HS. We could easily afford the house; it’s the taxes and utility costs that have nearly doubled in six years that is making our house a financial burden.
abc,
Nice write up. The fact of the matter is that if you want your children to have excellent educational opportunities you have to pay a premium. That premium has gotten more and more expensive over the years and it doesn’t help that energy, food, and Todd Stroger’s henchman take more and more of a household budget.
Well, it’s only a matter of time before that Bucktown house has its taxes raised. They’re low at that list price. The Glencoe home is hands down nicer than the Bucktown house from the pictures. The commute: advantage Bucktown. The schools: advantage Glencoe.
The city is overpriced.
On our house in Naperville, which was probably worth around $750,000 at the peak, we pay around $8000 in property tax. Our house is 15 years old, and we do upkeep every year, usually spending less than $5000. For that, we get the 11th ranked high school in Illinois (Naperville North). We bought here (after living in Streeterville, DePaul and Lakeview for many years) when our kids were school aged. You don’t have to pay high property taxes for good schools if you look around.
abc:
“Taxes in the “good school district” suburbs tend to be VERY HIGH. I’m in River Forest in a smallish but picturesque 4 bedrm/3 bath brick house. We will pay $16,000 (2007)in 2008 RE taxes for a house worth $700,000 in 2002. My 2008 property valuation assessment was increased to “$880,000!!” value without any capital improvements, even as I think the house is probably worth $700,000 today if we’re so lucky. So in 2009 we’ll probably pay $20,000 for a house that needs serious remodeling and constant upkeep.”
Juliana,
You’re exactly right. If I ever have kids I’m going to scope out the best school districts and move there and rent. I will be sure to thank you homeowners for paying for my kids education with your ‘pride of ownership’. I will also enjoy the flexibility of being able to move on short notice and with minimal transaction costs. With the extra cashflow I’m saving from renting I will invest it in profitable assets that earn a superior rate of return to real estate speculation.
I’m happy to think there will be a rental pool when we are ready to move. We’ve already considered that might be one way to go if things didn’t improve in a few years when our kids are out of school. When we bought our home 15 years ago, we paid $350,000 for it. When I saw the prices in homes around me inflating to unrealistic levels, I knew they were unsustainable and never counted on being able to “cash in”. This is our home, not an investment. That said, I’m glad not to have a mortgage on it now and would consider renting it out when we go buy our little farm where we can grow our own food, maybe raise alpacas and live out the next Great Depression. Just kidding, but we have been thinking about worse case scenario lately…
The good thing about Alpacas is that you can eat them as well as shear them. Not that tasty but not bad with the right sauce.
I’d rather raise my kids in Bucktown than Glencoe any day. Why would you want your kids growing up with no diversity (OK, gentiles and Jews living together..well, nearby in their separate suburbs)? I am beginning to think no one who contributes to this site lives in the city. There’s a reason that the I-94 is jammed up heading into the city on weekends. Suburbia, whether north shore or not, is a wasteland. Prices are high in some areas of the city because it’s a great place to live. Bucktown happens to be one of them. There are high-quality public schools there. Bucktown International Charter is one of them. Lincoln Park HS is another. Get real or, at least, admit you want to live where everyone looks like you and only has tattoos in discrete, private areas.
We’re in the near-west suburb of River Forest because of its immediate proximity to Chicago and the easy commute to North Michigan Avenue. Our employers’ offices aren’t located within walking distance of the commuter stations, and our jobs require some local driving to project sites. If you move to the far suburbs (Lake County or DuPage County), your commuting costs and commuting times are significant, and you’re dependent on Metra. And if you commute on Metra, you still drive to the station, and you must use the early trains if you’re to find a parking space at the Metra lots. This commuter headache should be factored into the “RE Tax vs commute cost vs private school tuition” formula when looking for a house.
Secondly, if you move to an outer suburb, you’re car-dependent for all your needs – school, shopping, socializing, etc. Many outer suburbs “forgot” sidewalks, “downtown” retail (yes, I know that Naperville does have a very nice downtown, but you still can’t walk there unless you live downtown as well), and have little non-chain retail or restaurant choice. And you probably live in a builder-box McMansion with drywall and vinyl siding, enormous volumes of space to heat, and relatively little mature landscaping. And you buy a lot of gas for your two or more cars.
I’ve lived all over this City nearly 15 years now after spending the first half of my life in the northwest suburbs. I obviously prefer the city and live here now but I recognize that there is nothing ‘wrong’ with the suburbs. Knocking the ‘burbs is the cool thing to do but I’m mature enough to realize that different lifestyles aren’t better or worse, they’re just different. At least in the suburbs you get a yard and they’re aren’t as many gangbanger and ghetto ass dudes everywhere. The police in the ‘burbs are twenty times more conscious about riff-raff and undesirables than the city is.
homedelete–i didn’t knock the suburbs. simply stated that the northshore has a lack of diversity and that the argument about schools is not really relevant, especially in areas like bucktown, river north, or LP. i’ve lived half my life in the burbs and half in the city.
diveristy? personally, i dont care. i live in winnetka and while i dont have a ten millior dollar house, my neighbor to the west is president of AON, and my neighbor to the east is CFO of mcdonalds – you not only pay for the schools, but to keep out the riff raff. i personally like the fact that people from say, Niles, cannot use the winnetka beach without paying a huge fee because they aren’t residents. my commute to the loop is 30 minutes via the metra (4 minute walk from my house) – so lets not pretend the north shore is Gurnee…
When you look at the top 25 earning towns in the Country, the north shore has 4 of them.
http://money.cnn.com/galleries/2007/moneymag/0707/gallery.BPTL_highest_income.moneymag/4.html
John 2 is one of the typical bucktown hipsters. When rubber meets the road and he has kids he’ll abandon his ‘diversity is the best attribute ever’ and instead opt for safety, quality of education, having a yard and lower taxes.
“i personally like the fact that people from say, Niles, cannot use the winnetka beach without paying a huge fee because they aren’t residents.”
Well that just sums it up perfectly, doesn’t it. As a Chicago resident, I’ll just say “you’re welcome” for paying taxes to provide over a dozen truly public beaches – even those mouth-breathing knuckledragging riff-raff from, (snort) Niles are welcome.
“That premium has gotten more and more expensive over the years and it doesn’t help that energy, food, and Todd Stroger’s henchman take more and more of a household budget.”
Just gonna nitpick here. I’ve got my 2007 property tax bill here, and the amount paid to the various Cook County taxing districts all decreased, both in terms of rate and dollar amounts, from 2006 to 2007, with the exception of “Cook County Public Safety” which increased somewhat. Forest Preserve, County General Fund, and County Health Facilities all decreased, both in dollars and in tax rate.
Fact is that Cook County hasn’t increased it’s property tax levy (the total amount collected in property tax countywide) in several years, meaning that the tax rate has been plummeting in both nominal and real terms. So the crazy high sales tax is just part of the equation factoring in to the incredibly low residential property taxes, relative to market value, in the City of Chicago. Of course, it’s still egregious and inexcusable that Stroger hiked the sales tax by 1% when he only needed 0.5%, but something was necessary to account for the constantly falling (in real terms) property tax revenue.
Thank you, Bridget, for personifying the person I’m trying to keep my child from becoming.
re abc comment:
We have never had a problem getting a parking space within a few blocks of the Lisle Metra station, which is closest to us. And when we do go into the city now its after the morning commuter rush. The trains run pretty regularly, and are clean and spacious. I remember, after many years of using CTA, what a change for the better Metra trains were. It gave me a little time to read the paper or a book on my comfortable commute.
My sister used to live in River Forest, and from what I remember, unless you happen to live close to Oak Park you still have to drive to the more interesting stores and restaurants. And you probably use your car to run errands as much as I do. There are plenty of McMansions in Naperville, but also lots of homes like ours (2400 sq ft, plus a finished basement). I don’t see too much vinyl siding in Naperville either, maybe because homeowners associations like ours don’t allow it (all brick and ceder in my subdivision). We’ve been around long enough that the trees are making a leafy canopy over the street and some yards, like ours, have bigger trees that predate the development. I’m wondering if you have ever been to Naperville.
I don’t live in the burbs and I don’t have kids… But my brother is one of those suburbanites, pays $12K/yr in taxes for one of the best school districts, and he has 3 kids which makes the taxes worthwhile.
I think people without kids fail to realize how much having the extra space matters when you have kids. All those extra rooms make a huge difference when 75% of your life’s effort goes into the kids. Having a good sized kitchen, a large laundry room, and extra space for everyone to just chill out is paramount when you’re constantly fatigued from day to day living.
Bob–
I know you find it impossible to believe, but there are a lot of people who choose to live in the city–with kids even–who could afford to live in **any** of the suburbs and that amny of them intend to send their kids to CPS.
If you think it’s unreasonable for city folk to disparage the ‘burbs, perhaps you should shut it about people who choose to live in the city.
just curious, at least our feelings are mutual…..
“Just Curious on October 7th, 2008 at 9:03 am
Thank you, Bridget, for personifying the person I’m trying to keep my child from becoming.”
I don’t think she cares. That’s the great thing about being arrogant.
Our feelings are mutual…so I personify the type of individual you don’t want your child to become?
I find this mildly amusing given your apparent penchant for high-quality education and unfettered beach access, but I’ll let it slide.
JC,
You too, personify the type on individual I don’t want my children to become.
I personally find it amusing the comments about the north shore lacking diversity. maybe they should put up section 8 apartments on sheridan road or something? i’m sorry that wanting my kids to grow up with the children of other successful families – and that makes me arrogant for some reason. but homedelete is correct, i personally don’t care what you think because your opinions have zero influence on me, as im sure mine do for you.
Bob–Right back atcha, buddy. You too, Bridget.
Frankly, I don’t want my kids to grow up to be the type who would stoop to living in Winnetka–if you aren’t the type who can buy in Kenilworth, why bother pretending to have any value.
And, HD, I think that “pretentious” might be an even better descriptor rather than arrogant.
” i personally don’t care what you think because your opinions have zero influence on me, as im sure mine do for you.”
And what’s so awesome about arrogance (or pretentiousness), I don’t really care either. The world is changing and for the worst, all you can do is insulate yourself as best you can from the hoi pollei and the unwashed masses.
The city is overpriced. I have three properties in the city and was looking for a single family in Lakeview/Lincoln Square for my family. I wanted 4K sq feet and nicely finished.
The city single families were 1.2M+ for 4000 sq ft (which includes basement space). Taxes 18-19K. So, I started to look in the suburbs. Well, I found a great house with 1.75 acres and has 4475 sq ft finished above ground and about 1500 in a walk out basement. Taxes 19K. Schools: Stevenson. Awarded top 100 in the country. One of the best in IL. Nothing in Chicago compares. All this for 950K! And, they plow my driveway! Done deal.
The city is WAY overpriced when you analyze the cost per a foot. Developers want 300/ft when the value is only 200-220/ft.
I will buy some more properties down here when it gets really bad and I can purchase them at the right price. For now, I will enjoy my family, my huge house (with a 200K new kitchen) and not have to worry about my kids getting in a “good” school.
Good luck to all developers. If you get a call from Kevin C, I pay cash, but I expect a 30-40% discount. 🙂
I would live in Kenilworth, but their median income is too low for me (see above link – those poor bastards didnt even make the cut!!)…oh, and i don’t want to live on the “south side” of the north shore either. too close to that icky town of evanston.
okay…i think we’ve all wasted way too many minutes of our lives on this topic….
I’ve never personally understood the whole “suburb vs. city” living debate. Both have distinct advantages and disadvantages — this post touches on mainly the cost aspect. Anon was 100% correct in that it all comes down to choice. Some families/individuals have the means to live anywhere they want.
Private beach access, big backyard, good school, whatever…. to each their own. The ‘my area is better’ discussions are sort of pointless. People value different things based on their own situation or preference.
Oh, c’mon, John…the nouveau riche are fantastically insecure…toy with their inferiority complex. It’s a blast.
JC,
How is that degree in French Lit treating you in today’s world where employers value practical applicable skills?
You choose your path in life, I find it funny you try to get others goat and contrive assumptions about them based on little info.
I agree with JC…Nothing like diversity when I get into the elevator at our Gold Coast appt and some Section 8 person with a rap sheet the size of my size 14 shoe gets into to go to his apt that his mom is paying $200 for.
Bob: “contrive assumptions about them based on little info”
That’s **really** rich coming from you, and especially after the first sentence of your post. I guess contriving assumptions based on generalities or no info is better?
PS–McDonald’s CFO lives in Downers Grove, not Winnetka and the President of Aon is also the CEO, and does indeed live in Winnetka. So the name dropping wasn’t even accurate.
Anon-
matthew paul
1086 laurel ave
winnetka,il 60093
Maybe you should apply for a job with Obama’s fact checking team?
Some of the comments here:
http://cribchatter.com/?p=2753
sum up how my degree in French lit is treating me. (All kidding aside…I really do have a degree in German lit, among other subjects, clearly.)
It really is just a matter of preference where you live. The misconception that bugs the hell out of me is that city schools are uniformly horrible with the exception of a few magnet programs occupied by politicians’ kids. That’s a myth that’s lived on far too long.
Other reasons for living in the Suburbs are perfectly valid. You most certainly get more space and reliable demographics. I’m sure some people love this concept. Personally, I think excesses like the fully-outfitted 1,000 square-foot playrooms warp the minds of our smaller and younger friends, but I can understand the appeal.
Bridget:
Check out McD’s website and investor info. Their CFO is Peter J. Bensen. Matt Paul retired a year ago. And that address is about 1.5 miles from where the “president of Aon” lives.
Using your “neighbor to the west, neighbor to the east” construciton, someone living in what’s left of) Cabrini is “neighbors” with Penny Pritzker and most of the Crown family.
Well JC, we actually agree on this. It’s a matter of preference! Everyone has a rationale to where they want to live, and it’s absolutely pointless to even argue this.
I would much rather listen to anon talk about the demise of the world and how home prices will never recover, how the stock market will go into negative numbers….seriously, take zoloft or something.
He retired a year ago!?!? oh my God, i was completely wrong!! maybe he is working as janitor now (well, the reality is his house is for sale and he’s moving to wilmette). he lives 1.5 miles from the AON ceo?? patrick ryan lives at the intersection of burr and laurel. now..if you look at this map, you’ll see patrick ryans house just to the southwest of the intersection. if you’ll notice, the house is basically a plantation (to the north is a school).
http://maps.google.com/maps?f=q&hl=en&geocode=&q=1086+laurel+to+burr+and+laurel&sll=42.113235,-87.745845&sspn=0.000969,0.001717&ie=UTF8&ll=42.113702,-87.745011&spn=0.000969,0.001717&t=h&z=19
i mean, tell me you dont like me, tell me you think im scum, but at least don’t try to tell me i dont know who my neighbors are! you are seriously just such a negative person it’s really crazy.
ps – the funny this is that the pritzkers used to live at the end of the block (laurel and westmoore), but they moved a long time ago….maybe to your neck of the woods?
“I would much rather listen to anon talk about the demise of the world and how home prices will never recover, how the stock market will go into negative numbers….seriously, take zoloft or something.”
I have **no** idea what you’re referring to. I’m pretty darn consistent on (1) certain properties are overpriced, but it’s case-by-case, (2) condos that are basically just apartments (like invsco conversions) should be priced with a correlation to rental value, and (3) seller’s expecting big gains right now over ’04 pricing are dreaming. I’m actually pretty optimistic, but I don’t think there’s a chance of things settling in until after the new year, at a minimum.
However, as has been said by many people more tied into global finance than I am, if you aren’t scared right now, it’s only because you don’t know what’s *really* going on.
I think the problem I have with city living aside from the school bias (which may indeed be biased, when I get to that fork in the road I will be sure to research) was previously the SFH’s in the city were unattainable for all but a dual income couple making 200k+.
Now that the bubble is deflating there might be some desirable, affordable SFH’s in the non-hipster, good neighborhoods. In fact I make no efforts to hide that my favorite house on the MLS is in a southside neighborhood (its also huge).
Before every buying though I’d need to let this bubble deflate: too much rampant speculation and fraud brought housing to prices unaffordable to average people. This is the biggest issue facing the country and will be for the next five years likely.
Patrick Ryan is the Chairman of Aon. The President and CEO is a dude by the name of Greg Case. Has been for several years. He lives on Higginton Lane, south of you.
re the pritkers:
Penny built (is building–don’t know if it’s done yet) a giant house on Orchard (just east of Halsted) in the 1800 or 1900 block–hence about 3/4 mile from Cabrini.
I agree that the house in Glencoe is beautiful, but the downside is that you have to then live in Glencoe, and suburban living is not for everyone. For me, walkability is everything and the walk score of the Glencoe place is 57 whereas for Bucktown it’s 85 (walkscore.com). The 57 score is not bad for the suburbs, but I’d personally choose the Bucktown home and location any day, and make the school situation work. BTW, I live in the city and have a school-aged child who happily attends a public school.
Anon, come on. I’ve been following your posts for a long time. Do you ever say anything positive, ever? I wouldn’t say im “scared” im “concerned.” In 3 years, I think we’ll be fine – with regard to the credit mess. probably a while longer for people who bought over priced junior 1br’s in the south loop….
I agree with you on the overpriced condos, and the fact that America Invsco employees should probably be investigated, but i dont think you’ve ever said anything positive. maybe i’ll have to go through more posts. I seriously believe that if there was a 2br condo on 600 n fairbanks for 300k you would say it’s overpriced.
i was referring to the chairman, you’ll have to excuse me. i had no idea the CEO lives on higginton lane. i’ve never even heard of that street. do you mean higgens?
okay, i need to get back to work. my comments are all in good fun as i love to argue about this kind of stuff. everyone have a good day (yes, that includes JC and anon too).
Good research, Anon.
Read Bill Gross’ commentary on PIMCO’s website. It takes a lot of courage to say you agree with this sort of guy given his reputation , but I’ll say it: I agree with Bill Gross.
No thing won’t be OK in 3 years. We’re all f’ked. For an example of what we face please look at Japan circa 1990-present.
“you are seriously just such a negative person it’s really crazy”
Please show me what I’ve written that is “so negative”. You name drop like some demented gossip columnist with out of date references and seem to defend your choices based on who your neighbors are. You’re rich, we get it–good for you (seriously, good for you). You’re probably richer than me and I would like to be richer than I am right now. However, I wouldn’t choose to be your neighbor if I had Sam Zell’s net worth, although it Pat Ryan wanted to give me his house, I wouldn’t say no, because I’m not a fool and I’m sure I’d love living there–hey I could afford the taxes.
Anyway, from your posts, it sounds to me that Winnetka has had some trouble keeping out the “riff raff”.
Jan,
So do you think you’ll stay in the city once your child reaches high school? Is CPS really all that bad, and are the magnet schools that difficult to get into? I’m in agreement with you about wanting to stay in the city…I tried the burbs and it wasn’t for me. So does staying in the city have to mean giving up a good education for your child (unless you can afford private school)?
“Read Bill Gross’ commentary on PIMCO’s website. It takes a lot of courage to say you agree with this sort of guy given his reputation , but I’ll say it: I agree with Bill Gross.”
Bill Gross is a ridiculous bull compared to Roubini.
“Anon, come on. I’ve been following your posts for a long time. Do you ever say anything positive, ever?”
(1) There are, unfortunately, a couple other “anon” posters. One semi-regular uses an uppercase A. I never use a capital A, so those posts are not mine. I understand if you doubt any denial of a particular post, but so be it. All of the “anon” posts on this thread are mine.
(2) I say lots of positive things. I’m one of the big CPS boosters. I’ve defended pricing of (some) SFHs in places north and west of Diversey and Ashland. I’ve talked (a lot) about postive changes in neighborhoods.
(3) I don’t think that pointing out that glorified apartments have values that (should) relate closely to the rental value of the unit is “being negative”–it’s reality, or will be soon. Does that same analysis apply to SFHs, especially in desireable areas? Of course not, as they are not easily substituted.
anon, I might have confused with Anon, but a recent post by one of you even self-decribed themselves as a bear. i took that as being pessimistic about the fate of the economy, housing market, credit market….not the kind of bear found at http://www.bear411.com. (If you’re wondering how I found that website, I heard it on Howard Stern).
I had my names wrong? Sorry, I don’t follow the history of McDonalds CFO’s. 1 1/2 years ago he told me was the CFO and was going to retire “in a while.” You make it seem like I’m claiming to live next to Brad Pitt. I have never actually seen or met Pat Ryan. I only found out he was Chairman (was he ever CEO, I’m not sure). This makes me a demented gossip columnist?
I’m wouldnt declare myself as rich. i bought my house a long time ago before the CFO, or Pat Ryan moved in.
Hey, just dont buy Matthew Paul’s house and we wont have to worry about being neighbors. If you consider myself “riff raff” from my posts on this listing….well, hey, whatever. I was referring more to the people who carry jet ski’s through crowded beaches in the summer and launch them in the water within 3 feet of children swimming…
Bridget–
You came after me as an exemplar of what’s wrong with the world and suggested I required psychotropic meds. Then challenged my factchecking with out of date facts and insulted me, too, then defended yourself by basically saying “well, it used to be true”. So I threw a little mud back at you. What else can you expect (at least on the intertubes)?
I’ve *never* called myself a bear, except possibly in the context of asking if a particular assessment were too bear-ish (and, of course, to highlight my appearance at Mr. Leather).
And those “people who carry jet ski’s through crowded beaches in the summer and launch them in the water within 3 feet of children swimming” aren’t merely riff raff–they’re sociopaths.
No hard feelings?
There is another “Anon” post where the individual is a self proclaimed bear. Sorry, it must not have been you.
Of course there are no hard feelings…this is cribchatter! All in good fun.
What’s the matter with self-identification as a bear? That is inherently pessimistic *why*? A belief (even a hope) that prices roll back to historical affordability is definitely a bear’s call–but I’d hardly call it pessimistic. Belief that housing will fall *below* inflation-adjusted normal prices (2003-ish nominal prices) is pessimistic. Anything higher than that is most certainly not.
I went to school and played on sports teams with Pat Ryan’s son. from my experience, hanging out with the children of super successful..ie rich..people is overrated. There’s usually nothing extraordinary about them, except sometimes they are extraordinarily spoiled. And of my friends today, the ones that have the most success/money didn’t grow up rich.
Now now, Kenworthey, I believe you are being pessimistic in your “inflation-adjusted normal prices” call of “2003-ish nominal prices.” I am much more optimistic about prices going lower than that.
G,
Sweet. Maybe I’ll just skip the condo entirely and jump into the SFH market if nominal prices crash. In this era of returned lending standards (GASP) and needing 20% down anything is possible with prudent purchasers and distressed sellers.
I think the timing of this crash can be directly attributed to not only no-doc, high-LTV financing but also median prices finally outpacing the conforming loan limit. Not sure if you’ve seen rates on jumbos recently but only a fool would pay those rates.
The S&P 500 is now at a 2003 level. The Nasdaq was this low in 1998.
Doesn’t it make some sense that real estate will retrace to at least 2003 prices, if the S&P already is (and probably go lower as the downturn continues?)
Just a thought. It WAS after all, the asset class that had the bubble (stocks in recent years- did not.)
Sabrina,
Fairr thought…. Remember when the housing market was weakening the stock market was still strong for quite a bit… the speed wil not be the same but the two will not diverge much. I see a 7,500 test on DJIA coming so have fun.
“Doesn’t it make some sense that real estate will retrace to at least 2003 prices, if the S&P already is (and probably go lower as the downturn continues?)”
You mean real estate doesn’t alway go up?
Just curious for those of you that have the ability to find out what type of mortgage somebody has on their home can you find out what type of mortgage Obama originally took on his home? If he took any time of sub-prime loan I will laugh.
IB: I’m in agreement that we could easily see 7500 on the Dow, unfortunately.
So, it makes sense that we will see housing go much, much lower. It will just take more time as it’s an illiquid asset (unlike what we’re seeing right now in the stock market where people can dump holdings quickly.)
“Doesn’t it make some sense that real estate will retrace to at least 2003 prices, if the S&P already is (and probably go lower as the downturn continues?”
Um, no. They have absolutely nothing to do with each other.
“I’m in agreement that we could easily see 7500 on the Dow, unfortunately.”
Based on what? Stick to real estate, Sabrina.
Asking Bill Gross what he thinks of the equity markets is like asking a Honda dealer about the new Toyota. Bill Gross manages bond funds for a living. He called for Dow 6000 back in 2002 and literally that week the market took off and doubled. None of us know what the market is going to do, but Bill Gross has a vested interest in it continuing to go down. Food for thought.
Sabrina,
For many… in many places it will take until the time you actually try to find a bid to see how much it might really have fallen.
BTW. thanks to the people that gave me some advice and helped me get to closing. Wow was it hard to get to closing as compared to the closing i had just 3 months ago.
T2… You live in a city with quite a few people in it that are actually very skilled at playing markets. Maybe she is running the same trendlines I am off the move up form the late 80’s and the double bottoms we had at 7,550. Go Bri!!!
Well, if you want to see some really scary data about the stock market it’s entirely possible to reach 7500 or lower:
http://www.investingminds.com/social/blogs/gary/index.php?pst_id=100184
As for housing prices and stock prices…the stock market is much more volatile than the housing market and I would argue that it has been in an even bigger bubble than housing so I would not expect housing to track stocks. Stocks also adjust much faster than housing.
However, I still believe that housing prices in Chicago need to come down another 10% and places like Lincoln Park and Lakeview even more since it hasn’t hit there yet.
Here is a good article from someone who’s been a long-term bear:
http://www.hussmanfunds.com/wmc/wmc081006.htm
I am not saying it is going to 7,550. I am just saying if I look at the picture combined with my experience of looking at pictures, it has 7,500-8,000 area test written all over this thing. Should have held up a bit just over 10,000 and instead it went through that like it wasn’t even there. Bad sign.
As for home prices I have said since my first post here a long time ago. Banks are insolvent and lending will cease. The bottom could/should be well under new build costs.
IB, do you think the market will move more or less straight towards the 8,000 range, or do you think we will get an interim 10-20% clearing rally first? I feel like we will likely get a major bottom this month, followed by a 20%+ rally after the election and then the market will either re-test or create a new bottom sometime middle of next year.
Honestly I never ever counter trend trade. If they remove short sellers from the market we could see a complete vacuum form, I would say that is the one I am most afraid of. This will be an UGLY X-mas season and a serious wave of layoffs should follow. We are in a spirtal now and just pissed away 700 bil (the # will be much greater, I think) that we will need.
I said to a friend last month…
“I have spent 90% of my mental energy over many years trying to
figure out something I am wrong still half the time on. These guys are playing a dangerous game thinking they can take a quick look at this and fix it in 2 days. Everything they do will be wrong.”
Last night was no more comforting hearing both parties discuss how we were going to spend our way out of a mess that we got ourselves into by spending. Americans do not want the truth, they want sugar coating, unfortunately the truth will become reality like it or not.
You can not have a healthy debt/consumer driven economy!!!
T2 to answer you more directly. I think this thing does the classic FU pattern I have seen so many times when a market breaks a diagonal trendline. It trades back, over time, above the horizontal point where it first broke the line (stopping out the shorts) without breaking the diagonal trendline that gave the sell signal, tests the convictions of the true shorts, hits the line and then falls apart completely. I only say this because that is the scenario that always screws the most people and the one I always hated the most.
And now to the terrace for wake and bake time 🙂 Funny thing is some realtor will post about the damn rental kids in the building causing that smell 🙂
IB,
DO you have a 9-5 job? The wake and bake on a weekday is quite extraordinary for someone with regular employment…maybe you’re a student?
jk —
Yes, we’ll absolutely stay in the city. CPS has always had some good schools, and the good news is that the trend is toward more and more of them, and at a rapid clip, too. This applies to elementary and high school level, and it applies to neighborhood schools as well as magnets and magnet clusters. There is no better time than now to stay in the city and choose CPS. And I swear, I’m not affiliated with the CPS PR branch, but am just a supporter. 🙂
HD… of all people to accuse me of being a student!!!
I never talked to you because you have always been a bit too much of a bull for my taste but you should have seen me on here quite a few times before, similar mantra as yours 🙂
Nah no job! Life is too short. But even when I did have one it was wake and bake 🙂
Eventually someone told me that those things in the front of the car are for holding cups and not bongs.
I saw the house. It needs a new roof, new gutters, new windows, a new kitchen. The basement experiences heavy flooding. And that’s what I just remember offhand. The real estate agent told me that it needs a lot of work and isn’t for the fainthearted.
Some sociologist should really do a study on traders. Given the traders I know I highly suspect the number of traders with alcohol and substance abuse problems is a much higher multiple than the general population. In fact its the small minority of traders that don’t seem to have issues with vices.
Oh no need for a study. It would take about an hour to confirm that. I don’t drink, very bad for you. Do love a great wine but that’s bordering on food in my book.
I figured he was a trader but hell, I would not place large bets of money while high. Too easy to make a mistake like putting 100 instead of 10, or pressing ‘submit’ too early, or misreading a chart IMHO.
Now back to serious topics.. Banks just cut rates globally. More cheap money available. Anyone want to go with me and watch them laugh if you go ask for some :-). It is like watching the multiplicative inverse of zero in action. What is any rate multiplied by the zero that they want to lend. This should once again solve nothing.
never made those types of mistakes. you would NEVER know I was.. NEVER!!
Plenty of people function perfectly well on a few tokes in the morning. It can be a very effective treatment for anxiety or depression, with less side effects than the pharmaceutical alternatives. Since BigPharm and the alcohol industry are against legalizing a drug you can grow in your back yard, legalization doesn’t look likely. JMHO, based on observation.
homedelete:
I would not place large bets of money while high. Too easy to make a mistake like putting 100 instead of 10, or pressing ’submit’ too early, or misreading a chart
OMG!!! Actually Juliana, HD is correct. That 7,550 I mentioned earlier. Well I accidentally was looking at it upside down while standing on my head and I also left out the 1 in front of it. I think this is going to 17,500. Sorry for the confusion 🙂
Dow 36,000 here we come!
I can’t believe that people here advocate trading stocks under the influence of marijuana. But hey! if you can do it and do it well, more power to you!
“I can’t believe that people here advocate trading stocks under the influence of marijuana.”
No one is doing that. IB noted that he did it, which is not the same as recommending it to others. Nor is juliana’s pointing out that it works for some.
c’mon with this market, for many, I think a needle in the arm might be necessary. 🙂
Necessary, sure. Recommended? Not by me.