Get This 3-Bedroom South Loop Penthouse for $190K Under the 2009 Price: 1211 S. Prairie
This 3-bedroom 61st floor penthouse at One Museum Park at 1211 S. Prairie in the South Loop just came on the market.
It is listed $190,600 under the 2009 purchase price of $1,260,500 (if you include 2 parking spaces.)
At 1892 square feet, it has a private entrance with lake, city and Grant Park views.
The kitchen has cherry cabinets, granite counter tops and stainless steel appliances by Subzero, Wolf and Bosch.
The listing says there are too many upgrades to mention them all.
This is listed $50,000 UNDER the unit directly below it, Unit #6002, which is also on the market and has similar finishes.
Of course, that unit isn’t the penthouse either.
Given the other units for sale in the building (including the one directly below it), is this a deal?
Gincarlo Bargioni at @Properties has the listing. See the pictures here.
Unit #6102: 3 bedrooms, 3 baths, 1892 square feet
- Sold in January 2009 for $1,260,500 (included the 2 parking spaces)
- Currently listed for $999,900 (2 car parking $70,000 extra) = $1,069,900
- Assessments of $1236 a month (includes heat, a/c, doorman, pool)
- Taxes of $18,600
- Central Air
- Washer/Dryer in the unit
- Bedroom #1: 15×14
- Bedroom #2: 16×11
- Bedroom #3: 10×10
“This is listed $50,000 UNDER the unit directly below it, Unit #6002, which is also on the market and has similar finishes.”
Sucks to be #6002.
I kinda choke when I divide price by sq ft… A very, same as everything else built 2002-2006, unremarkable apt.
“I kinda choke when I divide price by sq ft… A very, same as everything else built 2002-2006, unremarkable apt.”
What do feel is reasonable as a premium for the high floor and the permanently(ish) protected view? Either psf or straight $$.
What were the contract deposits on these places? I cant believe more people didnt just walk.
I think this goes relatively quickly. Top floor demands a premium and those views are incredible. Assessments are also quite low for a unit of this size in my opinion.
Not knowing too much about the SLoop…
#1 950000/2000 is 475/sq ft. dunno if I should include the parking.
#2 Assessments good
#3 No one above me
If I were looking at staying another 10 years, I’d consider buying it.
Schools?
What do feel is reasonable as a premium for the high floor and the permanently(ish) protected view?
That’s a good point, for me, huge premium. Maybe 20%. But that’s off a scale of how scarce. Should be no shortage of units that fit that requirement. Just maybe in not such a dramatic way. Me personally, don’t love the area.
“What were the contract deposits on these places? I cant believe more people didnt just walk.”
Not so surprised, gets back to 95% of people seeing realized vs unrealized losses as different things.
Oh and yes, straight line, just sailin on down the Phlegethon.
“950000/2000 is 475/sq ft. dunno if I should include the parking”
Whatever you do, you shouldnt include 108 sf of the lobby. 1892*475 is under $900k.
This is in the SLoop elem area, right?
“This is in the SLoop elem area, right?”
W/o checking, yes. As you know, it has both gifted and neighborhood programs, and I believe the neighborhood program is doing well. I did have a very brief and disjointed conversation (lots of kids around) with a parent of a kid who just started gifted this year who was a bit ambivalent about it, but my sense is it was more of a fit thing.
RE tax for this unit illustrates the unfortunate dichotomy in tax assessment policy. Many more luxurious but older condo units in nicer areas of East Lake Shore Drive, Streeterville, Gold Coast, and East Lincoln Park lake frontage are assessed at far lower rate than this recently constructed building. $18,000 in 2010 for privelege of living in South Loop is pathetic.
South Loop/Dearborn Park/Prairie Avenue area’s real estate value stability is questionable for a purchaser. Given number of new buildings in area with unsold units and “underwater” unit relatively new owners, number of renters and therefore relative transient population, and number of condo units available for rent all suggest that area could become predominantly “rental” in character.
I never been in an 02 this high, but city view is a “tricky” word, as it does have a “City” view.
the 02 i saw was a 2br and not a penthouse so maybe the floor plan is different up that high.
Would you really want to be that high up, i think after the 30th floor you start to get disconnected from the view your looking at.
the upgrades look way nicer, but again i looked at a lower 02 2br version so the PH may get the PH treatment.
“RE tax for this unit illustrates the unfortunate dichotomy in tax assessment policy. Many more luxurious but older condo units in nicer areas of East Lake Shore Drive, Streeterville, Gold Coast, and East Lincoln Park lake frontage are assessed at far lower rate than this recently constructed building. $18,000 in 2010 for privelege of living in South Loop is pathetic.”
I think it reflects the dichotomy in the sophistication of the owner (or would be owner). Luxurious older condo unit = baby boomer Chicago attorney who understands how to appeal taxes. South loop condo owner = trader who hit it big and has no idea how to even calculate RE taxes, let alone successfully manage them.
Assessed values are a zero sum game. The rules for said game were written a long time ago.
If you are concerned about schools in the Sloop:
Don’t forget about Old Saint Marys–they built a brand new school at 16th and Michigan; opening next year. Test scores are ALL above 90%. 8,500 per year.
No way I’d risk South Loop Elementary (I’ve heard mixed things from parents; some good; some bad.) But as Bob says, either way, you have to brave the CPS beaurocracy. I wouldn’t gamble in that way with my kids education when a good (and reasonably affordable) alternative exists.
“some bad”
What’s the bad?
$2,800 monthly nut before the mortgage. What where they thinking buying this right after the LEH collapse? Maybe a trader who thought their income wasn’t at risk? Confidence and competence do seem to be inversely correlated.
what does private entrance mean? private lobby on the ground with a private elevator?
@Bob – probably a trader whose income didn’t collapse, but as you can see, now has a child and wants to move to the burbs
“$2,800 monthly nut before the mortgage. What where they thinking buying this right after the LEH collapse? Maybe a trader who thought their income wasn’t at risk? Confidence and competence do seem to be inversely correlated.”
Bob – you don’t know everyone’s financial situation. To some, if you pay case, 2800/month is really not that much (especially if you are making 500-1million). The problem is that people here (and everywhere) put themselves in that particular situation – and you are right, for someone making 100-200k without savings, this wouldn’t make any sense – but this unit is not meant for that type of person.
$315,500 down payment by someone other than a day trader.
Why the talk about taxes?
the real issue here is the amount of unsold units still in this building and with a HOA fighting all the “investor” owned units and voting a $2000 move in and out fee.
and IMO the 01 and 05 tier’s are the best. and both pools are sweet here!
$945,000.00 mortgage
executed 01/28/2009
“Bad” is really big classrooms 35+; unruly students; some bullying. Lots of mindless homework; no real educational philosophy. I’ve visited the playground during recess and it is really wild–lots of yelling (by both students and teachers!), screaming, pushing. Teachers aren’t paying attention. I was in the school office once and I actually heard an administrator ask a school parent,”Who is your child’s teacher?” And the parent replied, “I don’t know.” How is that for parental engagement?
On the other hand, I’ve had some interaction with special ed teachers at the school; they care about the students (as I think most of the teachers at SL do) but it is just so big that the teachers are forced to yell a lot to keep any semblance of discipline.
““Bad” is really big classrooms 35+; unruly students; some bullying. Lots of mindless homework; no real educational philosophy. I’ve visited the playground during recess and it is really wild–lots of yelling (by both students and teachers!), screaming, pushing. Teachers aren’t paying attention. I was in the school office once and I actually heard an administrator ask a school parent,”Who is your child’s teacher?” And the parent replied, “I don’t know.” How is that for parental engagement?”
Thanks! I’ve had a couple of abbreviated and not very specific conversations with people with kids in neighborhood program there who thought it had improved in the last few years and were reasonably happy with the school. My wife did witness very unruly recess when she was walking around; not sure when, maybe 3 years ago now. Dunno about class sizes, but Groove’s beloved Oriole Park has really large class sizes too. Don’t these get equalized across schools (aren’t they supposed to be equalized)? Or is it a space issue of a numbers issue (if the school gets to the upper end of threshold without triggering the next teacher)?
I guess I’m a sucker for views and floor to ceiling windows, because I like the look of this place quite a bit.
I’ve been in just about every sloop high rise by now (except ultra low end crap like Marquee) and OMP is by far the the best. The only tower I keep on coming back to. Great floor plans and great amenities. Just about any tier has fantastic views.
I do agree that OMP is taxed too high, but that seems to be a problem with the old bubble pricing. Even some 2 bedrooms sold for over 900k originally, some units were highly customized.
I think this PH is the first one to come on the market for under 1 million, in that sense I think the pricing is pretty good.
“South loop condo owner = trader who hit it big and has no idea how to even calculate RE taxes”
There’s an absurd amount of lawyers and doctors living in omp.
“i think after the 30th floor you start to get disconnected from the view your looking at.”
I say the higher the better, but my wife considers around 30 the sweet spot as well.
wow worth the price for the views alone!
shame no downtown city exposure though
I don’t know how it works with class size; I just know it is a real problem at SL, so much so that they are considering moving the junior high to National Teacher’s Academy on 22nd. They already have the kindergarden at 18th; moving the junior high would further the logistical difficulties. (and NTA leaves MUCH to be desired; check out their scores!)
I should say that it is all a matter of what you want for your kid’s education. I know a number of parents who send their kids to SL elementary; most are reasonably happy even in the neighborhood program (and you can’t beat the price!) Personally, though, I’d rather pay the money elsewhere on the theory that you get what you pay for. For example, if I am staying late at work and can’t pick them up, I simply call the school. I speak with a woman who knows me and my family; I know my kids are safe until I get there. In comparison, I know a woman whose kids go to SL; her kids got ‘lost in the shuffle’ and were hanging around by themselves (ages 6 and 7) outside for three hours!
I think private entrance simply means when you get off the elevator there are no other apartment doors besides your own. An actual private elevator seems unlikely to me.
Anyone who would pay this amount of money for this type of unit is not going to send their kids to CPS period. Stop this idiotic discussion about schools – don’t you guys realize that if people were really concerned about the quality of schools, they would move to the burbs. No question. Period.
Assessments look pretty decent for the class of building and being the penthouse. However, like it’s been noted above, the real issue is the number of unsold units along with the vast amount of distressed units in this property.
It’s a beautiful building in a good location, but I would be very wary about buying here.
Clio–
I basically agree with you (we pay for private/ Catholic school rather than risk CPS) but many people don’t. They believe in the idea of public education or they don’t want to spend the money–no matter how much money they make.
I also think that given the increasing demographic similarity between Chicago and many of the suburbs, the distinction is no longer going to be City Vs. Suburbs, but rather, Private/catholic vs. public.
One more thing: as you yourself have noted, there are problems even with the very best schools, New Trier, Hinsdale Central, etc. God help the poor (or perceived poor) or the uncool kids at a school like that. School choice is a very individual matter; the issue is that parents have to give the matter a lot of thought; match the school with the kid, etc. As with all aspects of parenting, it takes time and effort.
doesn’t the developer still own the association here? I thought I remember there being a battle going on in this place.
that could explain why the taxes haven’t been appealed yet, as the association is the group that needs to get that process going, not individual units.
“However, like it’s been noted above, the real issue is the number of unsold units along with the vast amount of distressed units in this property.”
There’s just over 30 units available right now, that includes resales. The 2 bedrooms sold out long ago, the developer is mostly stuck with the larger 3 beds, plenty 01 tier, some 04, some 06 and a few penthouses I think. They are also trying to rent these out.
Any source for “vast amount of distressed units”? As far as I can tell there hasn’t been any widespread foreclosure activity or unpaid assessments in this building.
Don’t confuse this one with the barely sold tower right next to it.
“doesn’t the developer still own the association here?”
Association was turned over last year I believe, dont remember exact date.
Sonies, the association has taken over and is fighting the developer about move in fees. Basically they want to limit the rentals developer is holding on to. At least this is what I remember. Personally I like the hood and love those views. They are forever too. Assessments in the building are reasonable and amenities rock. I’ll take OMP over most down town high rises.
“Any source for “vast amount of distressed units”? As far as I can tell there hasn’t been any widespread foreclosure activity or unpaid assessments in this building.”
I’ve heard (3d hand) there are a large number of “Asian investors” owning in the building. But that, like anything third hand, is worth less than the average rumor here.
“Don’t confuse this one with the barely sold tower right next to it.”
I do count its sister building, wouldnt you?
I don’t believe anyone is living here, it’s staged. Maybe they put the crib in there on purpose, since they know they’re likely going to have to attract a family to sell this. It looks like the computer keyboard in the office/bd. is one of those plastic fake ones?
What kind of camera lens should be used in MLS pictures? In the kitchen, the one photo has a massive space between the stove and the kitchen sink, but this appears to be an optical illusion made by a wide angle camera?
Gotta love all the faucets/gizmos in the master bath, looks like the controls on a WW2 submarine. Overkill.
Lastly, regarding “CPS” and schools (anywhere), the bombshell I read over the weekend is that children develop their accents from the PEER GROUP from the ages of 5-15. So, parents sending their kids to CPS are at risk of allowing their kids to develop speaking habits comprised of Ebonics, Spanglish, and Chicago-accented “Deez, Dem, and Dose” and double negative blue-collar speak.
“Personally I like the hood and love those views. They are forever too”
dont be fooled into the forever, anything can change the game for the right price or perceived motivation.
i.e. the child museum bicentenial park approval thing that in the end will stay at tourist heaven
“I do count its sister building, wouldnt you?”
Nope, as they are different entities, different condo associations, etc, etc.
“Nope, as they are different entities, different condo associations, etc, etc.”
someone tell me if i am wrong but i thought they shared a few things like the outdoor pool?
“One more thing: as you yourself have noted, there are problems even with the very best schools, New Trier, Hinsdale Central, etc. God help the poor (or perceived poor) or the uncool kids at a school like that.”
Give me a break — this is true anywhere. Even inner city where bling and kicks assert status.
I’d rather have my little one sad because he doesn’t have an Aspen villa than shot over his Air Jordans.
“Chicago-accented “Deez, Dem, and Dose” and double negative blue-collar speak”
I don’t get it — Chicago is and always has been a blue collar town? So some yuppies decided they wanted to “live” in the city. Doesn’t change reality. Move to Lake Forest if you want cotillion and piano lessons. That is why it is there.
“someone tell me if i am wrong but i thought they shared a few things like the outdoor pool?”
They may well, and the available units in one certainly affect the other, but that still doesn’t make them one.
“I don’t get it — Chicago is and always has been a blue collar town? So some yuppies decided they wanted to “live” in the city. Doesn’t change reality. Move to Lake Forest if you want cotillion and piano lessons. That is why it is there.”
You didn’t check who you were responding to, did you?
“I’d rather have my little one sad because he doesn’t have an Aspen villa than shot over his Air Jordans.”
wow thats a gross oversimplification.
but i did get jumped for my starter jacket by two asian guys in 1992.
was pissed i had a roll of buss tokens in the inner pocket.
“They may well, and the available units in one certainly affect the other, but that still doesn’t make them one.”
Sort of like how “if A then B” yields “if not B then not A”? I think that was all you needed to know to score over 170 on the LSAT lol.
“by two asian guys in 1992”
Wow. Wah Ching in Chicago circa 1992?
http://en.wikipedia.org/wiki/Wah_Ching
I’d rather have my little one sad bc he doesn’t have air jordans than shot over his Aspen villa.
“They may well, and the available units in one certainly affect the other, but that still doesn’t make them one”
i am going for if they share amenities and stuff then HOA ass fees not being paid by the west building in turn jack up the east building owners.
also if your just selling views then the resale value of your east building unit will be tainted by the unsold masses in the west wouldnt it?
“I’d rather have my little one sad bc he doesn’t have air jordans than shot over his Aspen villa.”
It’s Aston Villa.
Q1 home values see biggest drop since 2008 -Zillow
NEW YORK | Mon May 9, 2011 12:01am EDT
May 9 (Reuters) – U.S. home values fell in the first quarter at the fastest rate since late 2008, real estate data firm Zillow Inc said on Monda
“You didn’t check who you were responding to, did you?”
Yes, and since Lake Forest restrictive deed covenants are illegal as a matter of law, I guess that was a wasted post.
Thanks Dan. Zillow is most credible source known to real estate. I believe my very own house was worth about $10M a few years ago. Zestimates are never wrong.
“also if your just selling views then the resale value of your east building unit will be tainted by the unsold masses in the west wouldnt it?”
You still have a great view of all tehpoors on the electric line!
But, yeah, the cost shifting point of the shared amenities is true; Do you think the buildings on the par-three course are tied together enough to affect each other?
Dan,
zillow is so unreliable, unrealistic and idiotic – anyone who listens or reads anything they say is a complete and total idiot/moron, etc.
Seriously, look at some of their valuations. They are SO off on all of my properties (way too high on some and way too low on others). It is so ridiculous, it is unbelievable!!!
“Move to Lake Forest if you want cotillion and piano lessons.”
that’s a gross oversimplification.
I’m not that concerned about “deez, dem, and doze” accents (they do give some street cred, if that’s worth much, I’m not sure it is unless you want to be the new police chief), but parents should be FAR more concerned about their kids picking up the Spanglish and Ebonics. (I only threw the ‘deez’ reference in there so I wouldn’t again be hysterically accused of being racist.) It’s the ghetto-speak stuff I’d be far more worried about at CPS in developing bad habits from the age of 5-15.
“i am going for if they share amenities and stuff then HOA ass fees not being paid by the west building in turn jack up the east building owners.”
I don’t think it’s shared at all. I’m pretty sure I asked this when I toured the west tower back in the day and they have their own indoor pool and workout area, etc…, just a lack of the great outdoor space that the East tower has. (and I’m not sure they would ever consider giving access for a fee considering a pool is a tiny part of the overall assessments.)
There is an “umbrella” association for I think 3 of the other towers in that overall development that share a clubhouse and outdoor pool area, but OMP isn’t part of it.
The unsold west tower is a bit of a concern, but since I’m looking for long term living I’m not all that worried about a temporary dip in value if the west one gets auctioned off for pennies or whatever.
“An actual private elevator seems unlikely to me”
I hope so because if the darned thing breaks down or needs a major mechanical repair the rest of the association would likely be very quick to deem that private elevator a “limited common element” and assign those costs directly to the unit owner(s) that benefit from that amenity. Good luck swallowing that cost of repair all by yourself.
Did anyone look at the distance between the stove and the kitchen faucet/sink? Doesn’t that look bizarre and quite a pain in the *ss?
“An actual private elevator seems unlikely to me”
I think all they mean is that the PH levels get their own elevator with key fob access, but you’re still stepping into a shared hallway, while the lower floors get 2 with no key fob required.
“Do you think the buildings on the par-three course are tied together enough to affect each other?”
good point, but the spread on the other side of the fountian is divided between way more.
Hey do you know if that is a Chicago Park dist park or a magellan ran one?
“Did anyone look at the distance between the stove and the kitchen faucet/sink? Doesn’t that look bizarre and quite a pain in the *ss?”
Yes, the kitchen really is that stupidly designed. Lots of walking all over the place to actually use it.
I too noticed that Dan but I checked and the kitchen is only 16×14 so i think the angle of the photograph makes it look bigger than it actually is.
“#Dan on May 9th, 2011 at 10:02 am
Did anyone look at the distance between the stove and the kitchen faucet/sink? Doesn’t that look bizarre and quite a pain in the *ss?”
“I don’t think it’s shared at all. I’m pretty sure I asked this when I toured the west tower back in the day ”
kewl, thanks bob deuce. to me looking to rent there i had no questions like that, but i remember somebody saying the outdoor pool/patio thingy is shared?
anyone tour OMP recently that can settle this?
Even those from Lake Forest will be surprised to discover that their seemingly absent Chicago accents reappear after a few drinks with a handful of east coasters. Just saying the word ‘tour’ or ‘car’ is a huge give away.
“#Dan on May 9th, 2011 at 9:57 am
“Move to Lake Forest if you want cotillion and piano lessons.”
that’s a gross oversimplification.
I’m not that concerned about “deez, dem, and doze” accents (they do give some street cred, if that’s worth much, I’m not sure it is unless you want to be the new police chief), but parents should be FAR more concerned about their kids picking up the Spanglish and Ebonics. (I only threw the ‘deez’ reference in there so I wouldn’t again be hysterically accused of being racist.) It’s the ghetto-speak stuff I’d be far more worried about at CPS in developing bad habits from the age of 5-15.
“Wow. Wah Ching in Chicago circa 1992? ”
JMM, i thought it was the vietnamese dragons but didnt have time to verify as i caught a few headshots before the knee to the gut and then the pull off of the jacket.
All being said about OMP, if i had the cash 340 on the Park and OMP would be the only ones i would live in.
340 seems to have sound HOA and holds its resale, but its higher price per sqft, higher ass fee and its probably high cooling bill (floor to ceiling south facing windows) are the trade off.
which would you guys choose?
Re Zillow: Is their pricing index that bad? (I haven’t really looked at it at all, probably on the assumption that it is bad.) I know they can be really off on specific estimates but that is a really difficult task given the inputs they have. Are the overall trends substantially worse than case shiller or other indices?
so lets see…the CS index shows a precipitous, the Clear capital index shows a precipitous decline, the core logic index shows a precipitous decline, and now Zillow shows a precipitous decline.
Therefore, based upon teh above, I can come to only one conclusion:
We MUST be at the bottom.
The issue with relying on Zillow for prices is that it’s just some Al Gore rhythm – that is, they just take available data and generate an expected value based on data about the properties matched up with assumptions about pricing curves and trends (and the data is often wrong). So, if Zillow says that prices fell some amount last quarter, all that really means is that Zillow’s manipulation of its algorithm yielded those results. I have frequently seen “Zestimates” off by more than 100%. Garbage in, garbage out.
“340 on the Park and OMP”
No brainer, 340.. it’s closer than OMP to Lincoln Park.
In all seriousness, as far as I can tell, 340 seems to have held up better in the downturn than almost any other building. That’s an important message.
So Groove, do we get the part of the story where you find Mr. Miagi, then kick their asses and gain their respect all while Joe Esposito sings ‘you’re the best around’
“CS index shows a precipitous”
Not for any home in tier 3, which is a very large segment of the metro area discussed here and more than just suburban cook. Plus any detached SFH on the north side of Chicago. Basically, none of that has had a precipitous decline. In fact, it has been flat for quite some time.
Again, no argument that condos are battered and that crack houses in Englewood, Garfield Park and Austin are falling through the floor. But if you look at the data — could it be that SFHs in attractive part of Chicago and suburbs are actually *outperforming* the broader 10/20 index?
By the way, the rich get richer maxim does support stability in tier 3. Unfortunately, it seems to be playing a role in housing prices. Of course, one could make the argument that a $150,000 dwelling, in today’s dollars, should be consumed by a renter and not by an owner occupier.
“Of course, one could make the argument that a $150,000 dwelling, in today’s dollars, should be consumed by a renter and not by an owner occupier.”
Why? Maybe it’s cause I’m kinda in HD’s school with the 3-3.5 times income, but to me a little over 150k seems like a price to own for the median income worker.
“I’m kinda in HD’s school with the 3-3.5 times income, but to me a little over 150k seems like a price to own for the median income worker.”
The average worker usually cannot or does not own a house (esp in or near the green zone)……
“The average worker usually cannot or does not own a house (esp in or near the green zone)……”
Honestly Clio I do appreciate the response. I assumed the comment of 150k was generalized and not specific to green zone properties or Chicago for that matter.
Just didn’t get it. Maybe a bit too much sun on the head earlier at the beach has me a bit slow.
But again, if the bad areas have ALREADY fallen through the floor, there isnt much room to go lower. So that leaves plenty of room for the middle and higher tier to fall. Just wait.
“Again, no argument that condos are battered and that crack houses in Englewood, Garfield Park and Austin are falling through the floor. But if you look at the data — could it be that SFHs in attractive part of Chicago and suburbs are actually *outperforming* the broader 10/20 index?”
HD – you fail to realize that there are a LOT of rich people out there. Think about all the successful businessed, all of the large law firms, all of the big banks. Now add in the highest tiered paid teachers/administrators, politicians, city officials. OK, now think of all the doctors and people who inherit money. Believe me, there is no shortage of people with money. The nice areas will stay extremely nice and even more desirable (as the less attractive areas will become even more unattractice).
I agree. But how does this have anything to do wth prices falling?
“The nice areas will stay extremely nice and even more desirable (as the less attractive areas will become even more unattractice).”
Is the higher end truly decoupled from the of the housing market? Is there a fence around these gated communities that says “sfh prices SHALL NOT FALL in this neighborhood because we are decoupled from lawndale!”
HD – just think about it. It is all very simple and logical:
In the “boom years” people had many choices and many decided to venture out of the green zone and nicer suburbs because they could get a lot more for their money and those other areas were starting to “come up” (think Bucktown, Wicker park, andersonville, s. loop, etc in the city; st.charles, elmhurst, naperville, in the west suburbs). However, with the bust, those areas are suffering because they never got a chance to truly establish themselves – but the tried and true areas of wealth (lake forest, kenilworth, winnetka, hinsdale, oak brook) have always retained their value = right now, people with 1 million are NOT looking to move to ST. Charles, Naperville, elmhurst – but are looking to oak brook/hinsdale. The same is true with the city.
Bottom line – the nicer areas will be even more in demand in the next few years.
“Is there a fence around these gated communities that says “sfh prices SHALL NOT FALL in this neighborhood because we are decoupled from lawndale!””
Strawman. I have no interest in making strawman happy, nor in being covered in straw and manure.
Is anyone on this site old enough to remember Chicago in the 80’s? I was in grade school, living in the burbs, but even on my few forays into the city it was a vastly different place–i.e. Lincoln Park pre-gentrification. Check out the movie “My Bodyguard” if you want to see a representation of the ‘old chicago’ as I remember it from those trips. And so, Clio, I don’t share your confidence that the rich areas (i.e. green zone) will always stay nice. Things have changed a lot (Museum Park, Lincoln Park, Bucktown, Lakeview) in a relatively short (30 year) time period. They may change again.
HD, real estate is local, local, local. As long as there is supply, demand, and ability to buy prices will hold. While I am not a RE bull, the reality is that certain areas hold value more than others. Yes, the broader market may be going down, but that still does not mean certain areas are not more insulated than others. You really have to look at RE data at a much more granular level with a huge dose of intangibles. Housing is not a commodity.
Zillow is totally off for anything other than cookie cutter tract homes way out in the burbs.
“Zillow is totally off for anything other than cookie cutter tract homes way out in the burbs.”:
100% agree with this statement. Zillow does EVERYONE a HUGE disservice…..especially uneducated and ignorant home buyers/sellers.
“Check out the movie “My Bodyguard” if you want to see a representation of the ‘old chicago’ as I remember it from those trips.”
Yeah, somehow the city changed in between that movie and “About Last Night”.
The Seventies was ALL about the suburbs: Z28s, anthem-rock, pot-smoking, skateboards, kegs…
My Bodyguard came out in 1980 and the urban city was totally neglected. At that time, Chicago only had two stretches of northside streets, Clark and Lincoln that were anything interesting or eclectic.
Then came the 1984 Cubs season, Reagan, Wall St./CBOT/CME and the city changed, and About Last Night, which came out in 1986, represents that new age.
“But again, if the bad areas have ALREADY fallen through the floor, there isnt much room to go lower. So that leaves plenty of room for the middle and higher tier to fall. Just wait. ”
based upon what? Oh wait, your arguments are full of holes. No wonder you hate your job, you suck at it
wait – where did the rich people live before the 80s? (this is a serious question).
OK everybody I’m a market bull now.
“HD – just think about it. It is all very simple and logical:
In the “boom years” people had many choices and many decided to venture out of the green zone and nicer suburbs because they could get a lot more for their money and those other areas were starting to “come up” (think Bucktown, Wicker park, andersonville, s. loop, etc in the city; st.charles, elmhurst, naperville, in the west suburbs). However, with the bust, those areas are suffering because they never got a chance to truly establish themselves – but the tried and true areas of wealth (lake forest, kenilworth, winnetka, hinsdale, oak brook) have always retained their value = right now, people with 1 million are NOT looking to move to ST. Charles, Naperville, elmhurst – but are looking to oak brook/hinsdale. The same is true with the city.
Bottom line – the nicer areas will be even more in demand in the next few years.”
I couldn’t agree more! I think this place is awesome, but let’s not forget that we are going back to RE 101. LOCATION, LOCATION, LOCATION! To pay anywhere near $500/psf is insane in today’s market.
I think it will sell, just not anywhere near this price for this location.
LOCATION, LOCATION, LOCATION!
and when that doesn’t work, it’s PRICE PRICE PRICE. and by PRICE PRICE PRICE i mean keep raising the price by 1% per week to show any potential buyers that you mean business.
I think the question is if A was 100k and B 500K, then A is 300k and B is 2 million, If A goes back to 100k why shouldn’t B go back towards 1 million. Still premium?
Manhattan. Ask Budd Fox. He paid nearly a million dollars for his 2 bedroom condo. And he hired an interior designer to spruce the place up too.
“#clio on May 9th, 2011 at 12:05 pm
wait – where did the rich people live before the 80s? (this is a serious question).”
Gringo: B is headed up to 2.5 million, at least. The rich get richer and they stay rich by overpaying for their real estate. If they got the money, they dno’t just spend it, they flaunt it. and since the higher end out performs the rest AND it has held it’s value, damn, high end real estate is the place to be right now.
“….damn, high end real estate is the place to be right now.”
Perhaps the smartest thing HD has said on this site!!!
“and About Last Night, which came out in 1986, represents that new age.”
Holy crap never heard of this flick but wiki’d it. Look at Rob Lowe’s hair! Does Rob Lowe even age??
“Holy crap never heard of this flick but wiki’d it. Look at Rob Lowe’s hair! Does Rob Lowe even age??”
Okaaaay – and Bob – you say, I’M the one with the homosexual tendencies?
“Okaaaay – and Bob – you say, I’M the one with the homosexual tendencies?”
Noticing Rob Lowe doesn’t appear to age equates with homosexual tendencies? I would think owning property in Boystown would be a much better indicator, but that’s just me. What DID draw you to own in that area, clio?
Bob – I thought you said you live in the area as well. Ummmhmmm – the evidence keeps piling up….
“wait – where did the rich people live before the 80s? (this is a serious question).”
Suburbs w/ rail access to loop or Gold Coast.
demi moore’s original chest is on display in that movie
“Bob – I thought you said you live in the area as well. Ummmhmmm – the evidence keeps piling up….”
You own in the heart of BT–is it your crashpad after a night of bar hopping?
now I must see it
HD — Unfortunately, the Tier 1 and Tier 2 SFH and Condo prices *are* falling while Tier 3 SFH is not. So, the evidence actually works the other way.
Endora,
I grew up in Lakeview in the 1970s and 1980s, and I agree things have changed a lot. I grew up east of Broadway, and in the late 70s, early 80s, the area around Wrigley Field was pretty tough. Lots of Latino and black kids who would give us dirty looks and sometimes chase us if we went west of Halsted. Once, two kids stuck me up with a knife right on my own street and took my new watch (this was in probably 1983). So yes, some neighborhoods have changed a lot in the last 30 years.
On the other hand, neighborhoods don’t always change for the better. When I was a kid, I had cousins in east Rogers Park. At the time, it was a quiet, middle-class family neighborghood. The area has gotten a lot more run down over the years.
And I’d say Uptown hasn’t really changed at all. It’s always supposed to get better, but it’s still just as scummy all these years later.
“No brainer, 340.. it’s closer than OMP to Lincoln Park.”
LOL, darn i shouldnt of used bing maps i should just stil to using google.
“In all seriousness, as far as I can tell, 340 seems to have held up better in the downturn than almost any other building. That’s an important message”
agreed, and i (and many) would like to know the magic formula why.
“So Groove, do we get the part of the story where you find Mr. Miagi, then kick their asses and gain their respect all while Joe Esposito sings ‘you’re the best around’”
LOL “SWEEP THE LEG JOHNNY”,
no i went home made a ice pack and sulked because those starter jackets were expensive and i (or parents) could not afford another one. luckily shortly after, thanks to seattle, the “grung” look took off and i was hip again!
“You own in the heart of BT–is it your crashpad after a night of bar hopping?”
…only if I pick someone up….
“Manhattan. Ask Budd Fox. He paid nearly a million dollars for his 2 bedroom condo. And he hired an interior designer to spruce the place up too.”
How many times have you watched the movie? Overall and in the last year?
Man… I remember the rash of thugs stealing Starter jackets.
I’ve seen it twice in my life; once about 6 or 8 years ago, and once a few months ago, a couple of days prior to watching Wall Street II. Money never sleeps. Part I was great, Part II was TERRIBLE.
“Holy crap never heard of this flick… ”
Bob, your homework assignment is to review these 2 films (my Bodyguard and About Last Night) and furnish a report due by next Monday.
“Man… I remember the rash of thugs stealing Starter jackets.”
russ bringing it back to slam dun dunn uh, onyx. Do you remember N.I.N.E when i first heard him i thought onyx broke up or he was part of the crew or something.
Sorry, i was in the garage working on stuff saturday and jamming out to old memorex tapes.
ran across a old main source tape ran into the house and itune’d it asap.
“Bob, your homework assignment is to review these 2 films (my Bodyguard and About Last Night) and furnish a report due by next Monday.”
Don’t forget Above the Law and Code of Silence for some Tru-Crime, 80s-Chicago-style.
and Red Heat
filmed at “six corners”…haha groove
http://www.youtube.com/watch?v=61nYwoswwyI
“Don’t forget Above the Law and Code of Silence for some Tru-Crime, 80s-Chicago-style.”
no shout to adventures in babysitting?
groove… we must be the same age. I used to love some Main Source. Looking at the front door… Friendly game of baseball. NINE’s voice was insane. One hit wonder though.
I feel like an old guy now when I talk to some of these young cats about hip hop. What is crazy is today’s artist are sampling rap song. Who woulda thunk? Producers are sampling samples. LOL.
Remember when I first heard Common. Booming and booming and booming in my Jeep. Bump Bump. Bump Bump.
“Remember when I first heard Common. Booming and booming and booming in my Jeep. Bump Bump. Bump Bump.”
i am as bad bad as leroy brown brown i got soul by the pound pound.!!!!!!!!
“filmed at “six corners”…haha groove”
i didnt see the “MR Steer” restaurant cant be six corners? or can it?
“I feel like an old guy now when I talk to some of these young cats about hip hop.”
i school my little cousins when they come over on what good hip is. YES I HAVE BECOME “THAT OLD GUY”. they are blown back by some stuff i play for them as the non mainstream hip hop fro our era is better that the mainstream stuff they got.
I have a kwest the mad lad cassingle and LP that my cousins cant find on any legit mp3’s. Last summer i got them hooked on Pharcyde and diggable planets. those little punks were bumping it all summer.
Don’t care what no one says. Common is one of my top five MCs of all time. Ph.D. level lyrical skills. To keep it on Real Estate…
He has a line in a song with Black Star called respiration released in ’99 which foreshadow’s the greenzone… lol
They tearing ‘Jects to create plush homes
I am somewhere between Cabrini & Love Jones
Surrounded by hate, but I love home…
Rap peaked with Tone Loc. There really wasn’t even a need for anything else….
Running Scared also had a ton of good 1980’s Chicago scenes in it.
Groove… I am definitely that OLD GUY.
A little shorty I mentor was shocked when I told him I’ve been listening to Ceelo since ’93 and he didn’t realize he was a rapper with Goodie Mob. I had to break out the old Outkast Southernplayisticcadillacmusik CD and Goodie Mob and school him.
I heard someone say it best…
Rakim was 17 when he recorded Paid in Full
Nas was 17 when he recorded illmatic
Black Moon was 17 when they recorded Who Got the Props
The best this generation could come up with for a 17 year old MC was Soldier Boy
“He has a line in a song with Black Star called respiration released in ‘99 which foreshadow’s the greenzone… lol”
i heard his part in the video was filmed in the chi i dont know never saw the vid but the song is sick
First time i heard Common Sense was on the Box. Box was a call order MTV thing in chicago the video was “take it ez” or “breaker 1-9” memory fuzzy but its the video where common sense is sitting at the edge of the bed. it seems more like break 1-9 when i think about it
“Ceelo since ‘93 and he didn’t realize he was a rapper with Goodie Mob. ”
come and get your soul food, well well, good ol fashioned soul food.
he was also on a track with common i thinks its called “god”.
hey speaking of goodie mob, rememeber “group home” my brain always confuses the two.
“Black Moon was 17 when they recorded Who Got the Props”
man i can listen to his shyte over and over “too turn tables and a mic”
or jeru tha damaga, a crazy mentalist conspiricy guy.
DANG WE ARE OLD NOW ARNT WE.
“I’ve seen it twice in my life; once about 6 or 8 years ago, and once a few months ago, a couple of days prior to watching Wall Street II. Money never sleeps. Part I was great, Part II was TERRIBLE.”
Fair enough, I thought it was just you, but a search suggests a wide appeal (HD, JMM, Bob, Ze).
Groove… youtube is your friend. They have all those old videos. All of ’em. One night I literally sat up for three hours just looking at old hip hop videos.
“Groove… youtube is your friend. They have all those old videos. All of ‘em. One night I literally sat up for three hours just looking at old hip hop videos.”
I wish i had the time for that, but at times when one pops in the head i will you tube it one or two videos. its crazy how many videos you tube deletes. it sucks.
To find any old house music videos it will be there one week and gone the next.
ah, I did that once on youtube too. but with even older stuff. watch the closin doors, roxanne roxanne, and other early/mid 80s stuff. some of it stands the test of time, some of it not so much.
hey groove & russ
watch steady mobbin by ice cube (not that d-bag lil wayne) for some great 90’s hip hop nostalgia
http://www.youtube.com/watch?v=k8jO3KcMlWE
awesome 8)
“for some great 90’s hip hop nostalgia”
no for 90′ you need;
http://www.youtube.com/watch?v=19w0VZh4Pg0
the punan punan punany!
LOL – let me add “Good 90’s hip hop”
“LOL – let me add “Good 90’s hip hop””
Oh you wanted good hip hop sorry.
well here you go;
http://www.youtube.com/watch?v=z3aRrokORjY
“ah, I did that once on youtube too. but with even older stuff. watch the closin doors, roxanne roxanne, and other early/mid 80s stuff.”
I’ve been trying to find footage of a concert I attended (Niagara Falls, or at least any stop on the tour), but to no avail. It was a tour sponsored by Swatch, circa 83 or 84. I think it was Whodini, Fat Boys, Run DMC, Grandmaster Flash & the Furious Five, and maybe some others (Afrika Bambaataa and the Soul Sonic Force perhaps?), with members of the NYC Breakers and Rock Steady on stage for some songs and mingling among the crowd (with some impromptu battles ensuing).
“I’ve been trying to find footage of a concert I attended (Niagara Falls, or at least any stop on the tour), but to no avail. It was a tour sponsored by Swatch, circa 83 or 84.”
*THE “SWATCH WATCH NYC FRESH FEST”*
with a Keith Haring designed t-shirt.
Poster from the Oakland show for $37:
http://www.wolfgangsvault.com/run-d-m-c/poster-art/poster/OCA841209.html
How old are you guys CH, Anonny, Anon (ufo)?
Seriously WTF how many D batteries did you guys go through just to listen to your music?
J/K 🙂
40
Sabrina could you please link to or excerpt from today’s Crain’s article titled “Sellers Get Past Denial” because while the featured owners are making apparently prudent decisions, it contradicts the statement “… the tried and true areas of wealth (lake forest, kenilworth, winnetka, hinsdale, oak brook) have always retained their value…”
search suggests a wide appeal (HD, JMM, Bob, Ze).
I would think with this quote you can add Clio to the list…
“You see that building? I bought that building ten years ago. My first real estate deal. Sold it two years later, made an $800,000 profit. It was better than sex. “
Any of you guys were into Aha and Depeche Mode? I used to be in love with both leads…lol
I recently went to a DP concert in NY and man he has aged bad. looks like an old women and the voice is not even there any more. I guess the good old Heroin does that to you.
“…and what I do, stock and real estate speculation. It’s bullshit. You got ninety percent of the American public out there with little or no net worth. I create nothing. I own. We make the rules, pal…. Now you’re not naive enough to think we’re living in a democracy, are you buddy?”
And once again.. 25 year old movie and people think what’s going on today is new… nope, nothin changes… Ok, maybe the 90% is now 95% 🙂
“and man he has aged bad.”
See Russell Crowe?? Wow!
“Sabrina could you please link to or excerpt from today’s Crain’s article titled “Sellers Get Past Denial” because while the featured owners are making apparently prudent decisions, it contradicts the statement “… the tried and true areas of wealth (lake forest, kenilworth, winnetka, hinsdale, oak brook) have always retained their value…””
Link below. Good article. But basically just talks about instances where homes were (or were almost) ridiculously overpriced. I actually think some of the prices paid were gifts to the sellers. A few of the instances, custom homes, don’t have broad based appeal relative to the amount of money put into them. Wine cellars for example — very bad investment but totally worth it if you spend your life there. But if you sell a few years later, well, that is another story. I feel bad for boomers who bought their homes too late in life to get any solid use out of them. Lastly, it tickles me how the broker BS is same story, different channel. In 2006, buyers weren’t being aggressive enough to take down hot properties. In 2011, sellers aren’t being aggressive enough pricing their property right (read: giving it away) so the broker can make their commission. Realtors should use the Lehman M&A pricing formula — value the business, put fee structure in place to incentivize the sale. Say 3% up to a fire sale value, 5% up to listing and 10% above that. Works for investment bankers, should work for realtors.
http://www.chicagobusiness.com/article/20110507/ISSUE03/305079994/sellers-get-past-denial
Ze, are you drinking? lol…I am talking about David Gahan!
southbound – that is a stupid article. Basically, I can tell Joe at Gold Coast Lamborghini/Bentley to price all his cars for 50k and they will all sell – does that make him “prudent”? Don’t believe everything you read – if you do, you are an idiot and deserve what you get!!
“Ze, are you drinking? lol…I am talking about David Gahan!”
Lol.. Ze isn’t much of a drinker anymore, since wine doesn’t count.
I know, but saw a picture of him about 2 hours ago and thought it was someones grandfather.
Oak brook home sold for $450k less than the 2005 price – http://www.redfin.com/IL/Oak-Brook/407-Fox-Trail-Ln-60523/home/17979863
>25% drop
Hilariously huge price drops from the original list on most these sales. Like 800k->$1M plus.
@ Ze, not that he was ever good looking but you are right. I don’t even like his acting. He so over acts.
Nat – that was a spectacularly great deal – and, of course, they are tearing down the house and building something else……. Of course there are a couple of deals – but good luck getting them – it ain’t going to happen unless you have connections. I tried to buy that particular house, offered full price (it was 1.45 million) so I can’t figure out how someone bought it for 1.15 million – it is ridiculous.
mm.. Ever see Gladiator? Awesome movie! Highly recommended with the right amount of bass.
I did not watch it. There are so many of those types of movies that it for some reason never interested me. I am just not into the whole Roman era movies. BTW, I rewatched a movie I used to like, called Jude, and I thought it was better than what I remembered. It is based on Jude the Obscure, Thomas Hardy’s novel which I for some reason have not read, even though I like his other books.
I do not believe you read the article or if you did you have a comprehension deficit issue. No one marketed their home for a fraction of its value to sell. The owners of a home in Winnetka paid $2.3 million & renovated. Later they were ready to sell – listed for $2.8 in May ’09 then lowered asking price several times over next 15 months of not selling until their ask was $1.99 mil and a buyer purchased for $1.9 mil. If it was worth more someone would have offered more during the 15 months. There are three similar examples of owners in your “tried and true areas of wealth” testing higher asking prices over time and then adjusting to the market & selling. What eludes you about this?
“southbound – that is a stupid article. Basically, I can tell Joe at Gold Coast Lamborghini/Bentley to price all his cars for 50k and they will all sell – does that make him “prudent”? Don’t believe everything you read – if you do, you are an idiot and deserve what you get!!”
Miumiu: after the violator tour david gahan lleft his wife, moved to la from london to date his american tour managwr and shoertly thereafter faith and devotion wwas released and it was all downhilll after that.
Jmm: giving it away! That’s rich! It wont sell for reduction Price reductions are giving the house away! Face it the market is NOT coming back.
“Face it the market is NOT coming back.”
HD – think about it – is this the worst recession we have ever been in? Is there no hope for the future? Don’t be stupid – real estate will be fine – just wait and watch – within a couple of years things will be back on track and, within 10-15 years, another real estate boom will be underway. Your myopic rants are idiotic and just plain wrong.
Long time fan of cribchatter, 1st time posting!
@Groove77: I toured OMP East and OMP West last fall. (just for fun, don’t have enough money to buy there.) If I remember correctly, OMP East’s facilities are connected to Museum Park Tower IV (Kinda odd, but they did the same thing with Towers I & II).
Anyway, probably the source of the “shared amenities” confusion. OMP East is occupied (OMP West is the empty one)
I like the views and the layouts are designed to give every room some sort of view. Overall quite nice, but in my opinion, both OMP East and OMP West are overpriced. One of the great things about the South Loop is that the area is relatively affordable (and with empty lots around, will remain so for at least the near future.)
Not been in 340 (too far from the El and no nearby grocery store, & too expensive for me), but a choice between 340 and OMP is a neighborhood lifestyle choice. LSE is beautiful, quiet, and away from the “riff-raff” of the rest of the city. (but far from public transport.) South Loop is grittier, but you can walk to the El, supermarket, etc. (other thought is that being on the South end of Grant Park gives you views of the prettier North end of Grant Park. =)
Groove77, if you’re serious about the place, lowball and squeeze the seller for everything he has. Parking spots should be included, etc. The guy’s an investor. If he short sales or forecloses, he’ll end up paying the bank to get out AND his credit gets killed. Keeping his credit is probably worth something to him.
Like Bob 2, I’ve probably been to every highrise in the South Loop (including Marquis. Window placement or lack thereof is completely nonsensical. Good call on ruling it out.). Love the South Loop (not for everyone. Not as developed as other areas of Chicago. Also bit gritty. But it’s close to the park, lake, el, highways, and loop. And relatively affordable.)
Bought myself a 2bd/2ba condo in a Southloop highrise last month. Yes, I know the prices are still probably going to drop (I definitely believe we still have a little further to go, though I also think that interest rates will rise.) But after being in the market for a year and a half, I found I place I really liked for a reasonable price and decided to go for it.
If I buy 10% above bottom on the way down, it’s not too much worse than buying 10% above bottom on the way up, assuming a short period in-between.
Anyway, you guys have been very helpful keeping me grounded in $#@! this place is still too $#! expensive this past year and a half. Thanks!
Intersting. Didn’t know that. Btw, in the new album “wrong” isn’t bad.
Clio-agreed!
People have very short term memories, real estate always comes back it just may take a long time. I always say RE is the one investment that no matter how stupid you are and how bad you try and screw it up, you can’t help but make money if you have the patience and financial ability to ride it out. Name any neighborhood in Chicago, no matter how shitty it is today, and I garentee you any piece of real estate there would sell for more today than it did 25 years ago. Period! Now this doesn’t mean that it was a good investment especially considering alternative investments, but the jackasses who say today’s market is never coming back and prices are going nowhere but down are just plain ignorant.
“HD – think about it – is this the worst recession we have ever been in?”
Yes, indeed it is. Unless you are at least 80 years old.
http://cr4re.com/charts/charts.html#category=Employment&chart=EmployRecessionApril2011Aligned.jpg
“I always say RE is the one investment that no matter how stupid you are and how bad you try and screw it up, you can’t help but make money if you have the patience and financial ability to ride it out.”
It’s kind of like going long the market in the 1920s…so long as you don’t need the money and can live for a while longer..you’ll eventually earn a return. Heck even tulip bulbs probably returned above their 1600s nominal value in Amsterdam by the 1800s, right Howie?
“I always say RE is the one investment that no matter how stupid you are and how bad you try and screw it up, you can’t help but make money if you have the patience and financial ability to ride it out.”
What about Japanese real estate values in the 1980s, Howie? How long are they going to have to wait? I read somewhere at some point one area of Tokyo had RE valuations in excess that of California. Any predictions?
“and I garentee you any piece of real estate there would sell for more today than it did 25 years ago. Period!”
No Howie I doubt that. There are homes you can get on the south side for under 30k. Methinks your income depends on transaction volume and you’re blowing hot air on here, actually.
Bob-
Unless I’m missing something, I don’t think anyone who understands today’s re market would compare it with the frothy pricing of the stock market of the 20’s before the crash or the tulip mania of the 1600s but I digress. Like I said, it may not be the best investment strategy……but anyone who believes that pricing is going to go nowhere in the future is just plain ignorant to historical facts. Does anyone wish they bought a property between 04-07, no…. just like no one would like to be the guy who bought stocks before the 29 crash, but the fact of the matter is in 20 years it’s not going to matter.
I am very disappointed to see a discussion of old school chi hip hop on a real estate blog with no mention of the blue gargoyle (south side) and steps (north side)
“Does anyone wish they bought a property between 04-07, no…. just like no one would like to be the guy who bought stocks before the 29 crash, but the fact of the matter is in 20 years it’s not going to matter”
Exactly – even though the majority of my real estate purchases in chicago were between 2004-2008, I still am able to make a 4-5% net return on the investments and, even though I spent more money on them than what they are worth (and no, none are underwater), it doesn’t matter to me because I have a long-term view. In 10-20 years, they will all be paid off and worth much more than what I paid for them. The majority of real estate works this way – again, you have to have patience, a strong gut, and have the financial means to not need the money that you spent on the real estate (down payment) for 10-20 years (ie, treat it like an IRA or 401k type investment). If you follow this advice, and buy “smartly” you will come out ahead.
Bob-
I believe you subscribe to the theory of never letting a good story get in the way of the facts.
Actually as one example, Southshore apartments buildings (not including the ones on the drive) you could buy all you wanted for back taxes in the 70s and early 80s. Prices then started creeping up in the late 80s & 90s to around $5,000/unit. Fast forward to 04,05,06 when prices went as high as $60,000/unit. Now let’s take todays value of $25,000-30,000/unit, still dramatically higher than late 80&90s value let a lone the 70s values.
Fannie Mae is asking for another $8.5 billion in taxpayer bailout money. They’ll never get rid of these behemoths and they’ll continue to distort and prop up the real estate market. They may be able to push it up again, but Howie F, this time may be different, as we are truly facing the end of a debt supercycle that didn’t exist in 2001 or 1993. One of these times the system will fall and it won’t get up, or not in the same fashion/format it once was. Maybe this time is different, maybe it’s the same and they can patch up the Fed/Fannie system again. There will be one time where it can’t be done, and I sometimes worry this may be the big one.
“I’ve been trying to find footage of a concert I attended (Niagara Falls, or at least any stop on the tour), but to no avail. It was a tour sponsored by Swatch, circa 83 or 84.”
*THE “SWATCH WATCH NYC FRESH FEST”*
with a Keith Haring designed t-shirt.”
anonny: you crack me up, white suburban boy, did you know Keith Haring was a homosexual? What did he have in common with hip-hop? Answer: nothing other than hip-hoppers, gays, and jewish promoters were ideologically united, at all costs, in together pushing an antiwhite art form on whites, and sucking some money out in the process, and you fell for it. tsk tsk
“Now let’s take todays value of $25,000-30,000/unit, still dramatically higher than late 80&90s value let a lone the 70s values.”
Yes but with such a long holding period return you would need to be renting those to even make them cash-flow positive, or compare to current rental rates.
And that’s a cherry picked example. Try that with neighborhoods that have went downhill over the same time frame: you’d be hard pressed to find one of these SFHs going for 30k in Englewood or Garfield Park selling for less than that 30 years ago.
“Exactly – even though the majority of my real estate purchases in chicago were between 2004-2008, I still am able to make a 4-5% net return on the investments and, even though I spent more money on them than what they are worth (and no, none are underwater), it doesn’t matter to me because I have a long-term view. In 10-20 years, they will all be paid off and worth much more than what I paid for them.”
This isn’t the east coast. Already Chicago condo valuations are showing a stark departure from what is going on in the coastal cities. Chicago condos just keep falling in value.
Methinks you incorrectly extrapolated your Boston experience to here and so far, and as history shows, Chicago isn’t a comp to the coastal cities either with valuation or direction.
damn, i knew those pesky negros, jews, and gays were all in it together, out to destroy our lily white virgin universe!
back in the world of the sane…
Laura – screaming deal in RP?
http://www.redfin.com/IL/Chicago/7449-N-Hoyne-Ave-60645/unit-3N/home/13573571
“as is”
roma: you don’t know how ridiculous you sound. The Fresh Fest is about as likely a collective group effort, or LOL, “spontaneous” cultural event as would be a MetalFest sponsored by addidas, promoted by mormons, with art work done by Keith Haring, and attened by black inner-city youths. But that did happen, the other ridiculous collective did. Try and use some reason. anonny would classify the latter as preposterous, and can’t see how the former is as well.
typo: “but that didn’t happen”…yet freshfest did! LOL!!!
Wow Roma how can this place only cost 97k? Is the neighborhood really bad?
For those still in denial, this was the big one:
http://cr4re.com/charts/charts.html?Delinquency#category=Delinquency&chart=NYFedTotalDebtQ12011.JPG
Look at that debt growth. From 4.6T in 1999 to 11.5T latest quarter, and we’re only off $1T from the peak and we’re growing again latest quarter!
And despite the media focusing on credit card debt and cribchatterers focusing on student loan debt look and globalization look at what comprises that $11.5T in debt. The giant elephant in the room is mortgages. Mortgages and HELOCs are 80% of it.
There are also around as many jobs as in 1999. As many jobs, yet $7,000,000,000,000 more in debt. Almost 6 trillion of that in mortgage balances alone.
Clio, Howie: maybe a trillion just doesn’t buy what it used to. But it’s still a lot of money. I don’t see RE bouncing back in real values any time in my lifetime. It might bounce back in nominal values if the Fed can induce broad based inflation, which hasn’t happened yet.
Inflation is only affecting imports as our trading partners demand more dollars as our central bank debases them. Housing cannot be imported or exported.
” It might bounce back in nominal values if the Fed can induce broad based inflation”
This is the “recovery” they are talking about. housing will go up relative to cash, over time, but nothing else because those items/costs will rise too.
It appears 45.7% of all Chicago homes with a mortgage are underwater:
http://www.calculatedriskblog.com/2011/05/zillow-on-negative-equity-284-of-all.html
That means people can walk away scott free from their mortgage with only a temporary ding to their FICO score. I wonder how this will bode for future real estate valuations in Chicago…
“This is the “recovery” they are talking about.”
It does take a nominal recovery in RE values to save the financial sector. But sort of more massive legislative chicanery like the tax credit I don’t see it happening.
All of the excess fed money being printed now is sitting in bank reserves where they earn the spread between ZIRP from the Fed and owning T-bills. Those earnings won’t be enough to save the banks from their insolvent positions. Seven trillion dollars is an awful lot of money.
err short of more massive legislative chicanery
Road to Perdition
A record 45.7 percent of homes here have negative equity, report finds
http://www.suntimes.com/business/5269309-420/a-record-45.7-percent-of-homes-here-have-negative-equity-report-finds
“The percent of mortgaged homes in the Chicago metropolitan area with negative equity set another new record in the first quarter, hitting 45.7 percent, according to the latest report from Zillow Inc.
That was up from what was a record 38.6 percent in the fourth quarter of 2010.
…
A record 48.5 percent of homes sold for a loss in the Chicago area in March, up from 41.2 percent in December and from 43.8 percent in March 2010, Zillow found.
Nationally, 28.4 percent of single family homes with mortgages had negative equity.
Values nationally fell faster than they have in any quarter since 2008, prompting Zillow to revise its forecast of a bottom being reached in the market this year. The bottom likely won’t occur until 2012 at the earliest, the real estate information company said.”
Bob – you are a complete moron if you believe that story…..
First of all, I can tell you that 100% of people that finance cars are underwater…. is that a reason for them to panic and get depressed?
Second of all, it just isn’t true – how the fuck would zillow get accurate information on all the housing out there? Are they basing it on the foreclosures and short sales in Englewood that closed and then extrapolating them to the gold coast mansions? The answer is that they can’t…. if you look at the valuation of my primary residence – it is off by 700k – and that is current market value that I am talking about (not how much I have spent on it). That is the whole problem – they are using inaccurate data to come to false conclusions. Stupid – and even more stupid are the people that report and quote these conclusions.
“Any of you guys were into Aha and Depeche Mode?”
I WAS! i rocked all the “new wave” tracks when i was a punk skateboarder. from clash to joe jackson to cure to depeche mode to erasure to bad boys blue.
all of it i still bump in my car driving to work.
“old school chi hip hop on a real estate blog with no mention of the blue gargoyle (south side) and steps (north side)”
dont forget to add rubberroom, ill state assassins, EC Illa.
“anonny: you crack me up, white suburban boy, did you know Keith Haring was a homosexual? What did he have in common with hip-hop? Answer: nothing other than hip-hoppers, gays, and jewish promoters were ideologically united, at all costs, in together pushing an antiwhite art form on whites, and sucking some money out in the process, and you fell for it. tsk tsk”
Dan, way off base Hip Hop is not a color thing or a music, its a cultural/lifestyle thang. its multicutural thing, and over the past ten years a international thing.
*you dont “do” hip hop, you “are” hip hop*
and with that kid, peace and i am outtie 5000!
No. It’s either just a well-priced “as is” estate sale or I don’t know what. Could just be a typo, of course. Taxes indicate assessor thinks it’s worth a lot more.
Seems like it would cash flow at list, but who knows what lurks behind the walls? Kitchen seems perfectly livable, or rentable, to me.
Laura, what do you think?
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miumiu on May 9th, 2011 at 10:32 pm
Wow Roma how can this place only cost 97k? Is the neighborhood really bad?
wow anonny, that fresh fest lineup would have been pretty much exactly what I’d have put together in my 1985 dreams. the one you described is even better than the poster.
Nucleus might have been kind of painful to sit through an entire set. they would have had to play a 20min version of jam on it to keep people from going to the concession stands
“Second of all, it just isn’t true – how the fuck would zillow get accurate information on all the housing out there? Are they basing it on the foreclosures and short sales in Englewood that closed and then extrapolating them to the gold coast mansions? The answer is that they can’t…. if you look at the valuation of my primary residence – it is off by 700k – and that is current market value that I am talking about (not how much I have spent on it). That is the whole problem – they are using inaccurate data to come to false conclusions. Stupid – and even more stupid are the people that report and quote these conclusions.”
totally true about zillow. my parent’s property is completely off, by about 600 grand or so, even given the crap real estate market.
I confess that I don’t know all the details behind Zillow’s index (they are intentionally vague about the methodology), but it is worth making the rather elementary point that even wildly inaccurate valuations of unsold individual properties won’t tell us much about how well the aggregate index captures a market’s price relative to other markets or changes over time.
Zillow is a joke. They have a zestimate on a house that is PND in my neighborhood about 50% higher than its last list. Not a short sale or anything.
Zillow isn’t new. They basically look at tax records, recently closed sales, bedroom/bath counts, etc. All PUBLIC information and basically spit out a number. Anyone with above average Excel/Access skills could probably come up with their own algorithm that is just as accurate provided they could get the data feed.
Mortgage lenders have been using Automated Valuation Models for a number of years before Zillow came out. They primarily serve as a gut check for underwriters when looking at appraisals. Some banks in their zeal to cut out staff mistakenly started using AVMs in place of appraisals during the boom (on refi’s) and got burned badly.
All these models really only work well when you have undifferentiated properties such as suburban tract homes. They can work with condos, but in my experience they tend to be off as the models can’t compensate for the significant changes in value in urban areas (got two blocks and entirely different hood).
“it is worth making the rather elementary point that even wildly inaccurate valuations of unsold individual properties won’t tell us much about how well the aggregate index captures a market’s price relative to other markets or changes over time”
I agree with this, not clear if everyone else does.
Models that make broad sweeping assumptions should be aggregated in their output. Zillow’s flaw is it ascribes a specific, usually incorrect, value to each property. One would have better luck with tax market values.
Not clear if everyone else even understands this.
Evidence: without exception, every single commenter here is referring to Zillow’s valuation of individual properties. Zillow could be overvaluing every single property by 500% and it would be completely irrelevant to the matter at hand.
How would we begin to assess the validity of the index re: national trends in prices (which is, after all, what started this)? For one, we’d be curious to see how well its movement correlates to changes in other indices (e.g. C-S, HPI, CoreLogic, etc). A cursory glance seems to indicate the national ZHVI tracks C-S/20 fairly closely.
Where there are divergences, we’d want to look more closely.
In my 10-second google search, I came across this, an interesting look at seasonality, foreclosures, and C-S/ZHVI.
http://www.zillow.com/blog/research/2010/11/04/case-shiller-not-just-a-home-price-index/
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DZ on May 10th, 2011 at 2:48 pm
“it is worth making the rather elementary point that even wildly inaccurate valuations of unsold individual properties won’t tell us much about how well the aggregate index captures a market’s price relative to other markets or changes over time”
I agree with this, not clear if everyone else does.
@Groove77
“bad boys blue” really? REALLY?
thanks for destroying my image of you. Now I think of a hobbit who is vietnamese with his hair teased/spiked up 5 inches rocking his blackout Acura Integra.
Next thing you’re going to tell me is that the Prom theme was Alphaville Forever Young
Lol @ bad boys blu…. Lady in black was one fine cheezy tune : )
btw, did you guys know Bros or Europe? I don’t think they were famous in US, were they?
Europe as in The Final Countdown song or another band altogether?
Well, I was keeping to places (you know, on a real estate blog). But that reminds me…Lower Links. And Medusas. Sure was a different city back then
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Groove77 on May 10th, 2011 at 6:51 am
“old school chi hip hop on a real estate blog with no mention of the blue gargoyle (south side) and steps (north side)”
dont forget to add rubberroom, ill state assassins, EC Illa.
Yup… Final count down. I still have that song on my ipod : )
Miumiu Matt Goss has a show in Vegas. Yes Bros Matt Goss.
miumiu, you may want to get yourself over to Mayfest on May 21 (Barry & Ashland). Too White Crew and Hairbangers ball will reunite for a show of epic proportions. They’ll almost certainly play Final Countdown.
Bob-
If you are correct and refuse to look at historical data, you might as well buy a farm in Montana, stock up on gold and guns because no matter what you pay for a piece of re it will be worthless. I for one believe in this country and that the market will come back at some point.
Ignorance=fear of the unknown.
Ha! Refusal to accept NAR tagline” real estate always goes up in the long run” = ingornant goldbug renter. Classic.
“@Groove77
“bad boys blue” really? REALLY?”
yes the were so cheesy that it went full circle to fun to listen too.
I would have added Joy Division, and its new band New order but i really didnt feel like “feeding” Dan that day.
“Next thing you’re going to tell me is that the Prom theme was Alphaville Forever Young”
LMAO!!!!!!!!!!! doode thanks for that one i almost spit my water on my keyboard
“Lol @ bad boys blu…. Lady in black was one fine cheezy tune : )”
thats the point it was they were so silly flaming that it was just fun listening too.
“But that reminds me…Lower Links. And Medusas. Sure was a different city back then”
Medusas, Exit, Neo, Daytimes at the Oak theater, medusas when it moved to the Vic theater, Medusas when it moved to the congress Rainbow, China Club, Erics North, Kaboom’s, ToTo’s, Alcatraz, Gordon Tech or Webber dances….
….and the list goes on.
it was different then as the worse fit that would break out is a girl caught her man cheating and slapped him a few times.
in those days there were no things as a hip hop club, a house club, a gay club, a techno club they were all just a club and the DJ would spin all the types of music and people from all walks of life would just have pure fun and all dance together on the dance floor forgetting all their urban blues.
man i miss those days 🙁
“Bob-
If you are correct and refuse to look at historical data, you might as well buy a farm in Montana, stock up on gold and guns because no matter what you pay for a piece of re it will be worthless. I for one believe in this country and that the market will come back at some point.
Ignorance=fear of the unknown.”
“but the jackasses who say today’s market is never coming back and prices are going nowhere but down are just plain ignorant.”
No Howie. Ignorance is your second quote: saying RE always goes up in all instances when that’s not the case. Ignorance is also ignoring the fact that prices are indeed dropping precipitously currently, especially for condos. You can ignore the data or try to assay fears with your hollow platitudes about buying RE all you want–doesn’t change the fact that anyone buying today is taking a huge leap of faith.
I am more grounded in the reality on the ground than you, so to associate me with an apocalypto is just more fear mongering to paint me as an extremist–but my views on the RE market and Chicago in particular are based on observable data in recent history. Not opinions or much older data, which your views are full of.
real estate doesn’t always go up, but rents usually do
so if you can stay put for a long time and easily afford your monthly nut, real estate can be a pretty decent inflation/taxation hedge
bob… I’ll stick to painting you in raibow colors…. Is that ok?
Dan on May 9th, 2011 at 9:23 am
“Lastly, regarding “CPS” and schools (anywhere), the bombshell I read over the weekend is that children develop their accents from the PEER GROUP from the ages of 5-15. So, parents sending their kids to CPS are at risk of allowing their kids to develop speaking habits comprised of Ebonics, Spanglish….”
homedelete on May 9th, 2011 at 10:09 am
“…parents should be FAR more concerned about their kids picking up the Spanglish and Ebonics…. It’s the ghetto-speak stuff I’d be far more worried about at CPS in developing bad habits from the age of 5-15.”
I find the logic of those who hold racist beliefs intriguing.
1. All blacks speak Ebonics.
2. Attending a school with a blacks means that whites will always peer with blacks.
3. Whites will always fall under the influence of black speech patterns.
4. Blacks will never fall under the influence of white speech patterns.
“I find the logic of those who hold [deleted] intriguing”
Please don’t do this. There is *tons* of similar stuff that has managed to not get deleted, if you’re inclined to trawl around looking for it, but we don’t need to re-hash it and saying “[deleted]”–whatever the validity or lack thereof it has–just devolves into another fight about things well irrelevant to this blog.