Is This a Cheap 2-Bedroom In Town? 1250 S. Indiana in the South Loop
This 2-bedroom at 1250 S. Indiana in the South Loop recently came on the market priced at $228,000.
It is being sold “as is”.
The unit is also available under the “first look initiative until 4/12/2012.”
It is a southeast corner unit on the 10th floor with, the listing says, some lake views.
There are hardwood floors in the living/dining/kitchen area and carpet in the two bedrooms.
From the pictures, the kitchen appears to be intact with stainless steel appliances but no granite counter tops.
There is central air, a washer/dryer hook-up in the unit and there appears to be parking included (but that’s not 100% clear.)
Unit #1108 directly above it with a more upgraded kitchen is currently on the market for sale by owner at $350,000.
Unit #1308, which was a bank owned 2/1.5 bath unit (compared to this property with 2 full baths), sold in October 2011 for $208,000.
Is this a deal for someone looking for a basic South Loop in town to crash for the weekends?
Teresa Ryan at Ryan Hill Realty has the listing. See the pictures here.
Unit #1008: 2 bedrooms, 2 baths, no square footage listed
- Sold in June 2008 for $294,500
- Lis pendens foreclosure filed in July 2010
- Currently listed “as is” for $228,000
- I can’t tell if parking is included or not- but it looks like it is
- Assessments of $508 a month (includes cable)
- Taxes of $3725
- Central Air
- Washer/Dryer hook-up in the unit
- Bedroom #1: 13×10
- Bedroom #2: 10×12
I actually lke this–for the right person. It is near Museum Park, in a great neighborhood very close the lake and downtown, with new construction at a reasonable price. And newish–which I realize is not a plus for everyone, but which would certainly cut down on maintenance. Taxes are high, though, and with the HOA you could be looking at 800 per month before your mortgage, so it is not for everyone. What do you think a person would have to make per year to afford this comfortably–100,000? So that would cut down on the buyer pool.
My first two questions for most South Loop newer developments: “how viable is the condo association and what’s its financial status?” and “how many renters are in building, and is rental unit count capped at a lowish percentage?. With a high number of available units for sale and/or rent, building’s relative stability is a big issue in near-southside area. (Also check whether Section 8 rentals are occurring, and if so, how many units presently rented as so.)
I doubt this unit is even 1000 sq ft. It is absurd to think that this could sell for $200+ psf; and it just might.
“Taxes are high, though”
You think $3725 is high? This will seem absurdly low in 5 years.
I’m not sure that the “in town” phenomenon is really as significant as it’s made out to be here, and I definitely don’t think that people who have these “in towns” are buying crappy little two bedrooms in the South Loop which would otherwise serve as housing for young people, college students, etc. I know a few people who have “in towns” and their primary homes are no closer than Milwaukee or Indianapolis (i.e. no suburban folks) and they make big bucks. Their “in towns” are nice and expensive, just like their primary homes are.
It is a great location but such a blah looking unit. I’d think it’d be a better value under $200k but I wouldn’t be surprised if someone pays more than that.
The association in this building is in rough shape. Very rough shape – low reserves, potential for specials, etc. There have been a number of units in this building priced relatively low in the last few months for that very reason along with a high number of short sales and foreclosures.
JJJ, I know quite a few people with in towns in Chicago, most of them in their thirties, some couples some single, and a few older couples. Not all of them are rich and some would actually buy 2/2s that are not that nice. Most of the group I know have incomes between 100-300K.
I think it is priced to move. Without looking at specific comps, I’ve been surprised at the demand for 2/2s in the south loop and with parking this is priced around 200 grand which is where those units have been selling.
I’m not saying this is a good investment though.
Well, I guess that people will always do stupid stuff, but I can’t figure out how buying a crappy 2 bedroom condo for occasional weekend use makes sense for anyone, especially not people making a ton of money.
is there a breakdown somewhere, by zip or hood, that shows the % or detail of foreclosures and short sales to available inventory?
hint hint G 😉
This seems like a good deal and Indiana is a nice street.
also is there a breakdown of homes/condos/TH/Multi there are to what is listed by hood or zip?
I think there will be a whole generation of reluctant landlords who end up with in-towns because as they finally reach a point where the market value and what they owe on their downtown condo meet, they realize it’s only a few more years until the darn thing is paid off so why not enjoy picnics at Millenium Park while the kids are off to college.
@ JJJ, whether the financial investment of this type makes sense or not is another matter. I just wanted to say there is a market for non luxury 2/2s for out of towners.
I’ve heard of a number of cases of people who (for work situations) live in smaller towns in Indiana, Michigan, etc., that much prefer to spend their weekends in Chicago for the restaurants, entertainment, etc. But for suburbanites, the in-towns made more sense when they were an appreciating asset. I’d need to convince myself that my family would want to spend at least 6 days a month to justify the cost of an in town.
“I’d need to convince myself that my family would want to spend at least 6 days a month to justify the cost of an in town.”
Which for most people means 3 out of 4 weekends. A tough nut especially considering that there are lots of nice places to spend weekends besides Chicago. Unless you have strong reasons to think you’ll want to spend 75% of your weekends in one city (e.g. family visiting) hotels make more sense than an in-town that you will feel you have to use, whether you want to or not, to “justify” what you spent on it.
If you’re going to spend every weekend in Chicago, why not just live in Chicago?
I never understood in-towns or vacation homes for middle class people. I like seeing different places on vacation. I wouldn’t want to have a house in another city/country.
Question for all the “experts” out there. My wife and I currently rent in the South Loop and will be staying there for the next 4-6 years. Would any of you buy a 2/2 like this as a first-time buyer? If not, what would you be looking for to tip the scales?
An in town may make sense if you intend to move there eventually, otherwise I agree why bother?
Because not everyone can work in Chicago.
“If you’re going to spend every weekend in Chicago, why not just live in Chicago?”
“An in town may make sense if you intend to move there eventually, otherwise I agree why bother?”
I thought in towns where for lawyers that frequently have to work until 2 am and then be back in the office by 8 am. Married male lawyers have been known to like this arrangment. In these situations, a crappy place is better since the wife will not want to spend time there and, therefore, will not get to know the neighbors.
“they realize it’s only a few more years until the darn thing is paid off”
how do you figure? most people choose 30 year amort.
“Married male lawyers have been known to like this arrangment. In these situations, a crappy place is better since the wife will not want to spend time there…”
LOL! I bet they like the arrangement.
I am pretty sure that the women who told the SoNo poster from the other day that his view was a panty-dropper would consider this unit a panty-lifter.
It is interesting how we all have our biased view of who buys in towns. My sample are mostly of these types:
a) young couples with or without kids (2 max) who like to come to Chicago for fun/museums/restaurants/family
b) singles, 30ish early 40ties, who are stuck in a small town, but like to have a Chicago base for fun/dating, etc..
c) empty nesters (not yet retired) for the same reason mentioned in part a
d) empty nesters mainly because they have kids/grand kids in Chicago but they are still working in other towns
“If you’re going to spend every weekend in Chicago, why not just live in Chicago?”
Jenny – I have some good friends that took over their parents business in Elkhart. There was one string attached. They had to LIVE in Elkhart. The business is tied to industry there so they can not easily move it to Chicago. Another friend is an Ortho surgeon who covers NW Indiana. He makes major $$$$ out there and is willing to make that tradeoff. His wife and her family are all from the Chicago area so once the kids are out of school they spend the entire summer in Chicago. They also frequently host family parties on holidays in the place. No it is not an entry level south loop 2 bedroom they chose a big place at the Heritage. It is quite nice. There are many others in the same situation who are scaled in price accordingly.
“Married male lawyers have been known to like this arrangment. In these situations, a crappy place is better since the wife will not want to spend time there and, therefore, will not get to know the neighbors.”
This arrangement also allows the wife at home more opprotunity for affairs with the UPS and Fed Ex drivers.
I have a few clients who basically do a reverse commute to the city for weekends. They have to live way out in podunk for work commitments, but much rather be in the city. I’ve seen a number of professors do this too at some of the Universities that are within 3 or 4 hours of Chicago. They have cheap rental housing when school is session and then come to the city for the weekend and when school is out.
And then of course you have the modern-day Mad Men types who like to keep an extra place for “socializing” thjat is more discreet and “classy” than a rent-by-the-hour no-tell motel.
When the wife + rugrats aren’t around for weekend sight-seeing trips of course.
“Question for all the “experts” out there. My wife and I currently rent in the South Loop and will be staying there for the next 4-6 years. Would any of you buy a 2/2 like this as a first-time buyer? If not, what would you be looking for to tip the scales?”
SLoopRenter: I would try and buy the largest unit I could in case children came along (although I knew someone with a 3-bedroom in the South Loop that was 1800 square feet who still felt it necessary to move to the suburbs after Baby #1. He lost $75,000 on the unit.)
What do others think?
The listing says the listing price does include parking.
“Question for all the “experts” out there. My wife and I currently rent in the South Loop and will be staying there for the next 4-6 years. Would any of you buy a 2/2 like this as a first-time buyer? If not, what would you be looking for to tip the scales?”
No. Ignoring the quality of the unit, the association in this building isn’t in the solid financial condition I’d recommend for a first time buyer. You want to make sure your comfortable with the housing payment, taxes, etc. without having to worry if you’re going to get hit with a $10k special assessment out of the blue.
Thanks Sabrina, Slooper! Is the market so unsteady in the South Loop that you would recommend just renting for the next 4-6 years? Or if you find a good deal in a stable building, is it worth buying?
@ SLoopRenter, I think the idea of using the rent/buy calculator is a really god suggestion. There are some very nice buildings in SL (I own a 1BR in town in one), but the prices have been falling in those as well.
Unless you like to buy as part of your investment portfolio which I think is not a bad idea personally, what is the rush? Especially if you already know it is for a short time (4-6 years) and your needs most likely are going to change quite a bit in foreseeable future.
“they realize it’s only a few more years until the darn thing is paid off”
“how do you figure? most people choose 30 year amort.”
How do you not read and comprehend entire sentences before jumping to a conclusion? I posed the pre-condition that “this group” is in the future and will occur when “they finally reach a point where the market value and what they owe on their downtown condo meet, ”
i.e. year 25 of the loan at the rate the south loop is scheduled to recover.
Sabrina is a housing bear and does not recommend buying in most situations. While this unit sucks, there are a lot of 2/2s in the South Loop closer to $250k or so which are much more attractive. See, e.g, units in 1307 and 1322 S. Wabash, just from a quick look. I can’t tell you what to do, but if I wanted to live in the South Loop, was going to stay at least 4 years and I could afford the costs of these units and losing some money on paper on the place that I live wouldn’t be the absolute end of the world, I would be looking at buying, no question.
To JJJ;
I am not familiar with South loop, but why 1307 and 1322 are much more attractive? They are much older and isn’t 1322 next to the train track?
@JJJ: 1322 is a solid building with a lot of character that is extremely financial sound and doesn’t do special assessments. I’ve seen both of the units for sale in 1322 – the 2/2 priced at $290k is awesome depending on your space needs.
I don’t know 1307 very well.
“See, e.g, units in 1307 and 1322 S. Wabash, just from a quick look. I can’t tell you what to do, but if I wanted to live in the South Loop, was going to stay at least 4 years and I could afford the costs of these units and losing some money on paper on the place that I live wouldn’t be the absolute end of the world, I would be looking at buying, no question.”
Yes- just go ahead and lose money. Everybody’s doing it!
JJJ: they ALREADY live in the South Loop. What’s the difference if they live in the Astoria Towers as renters OR they buy a smaller (and probably less nice) 2/2 in some other building?
Here’s what they gain:
1. Washer/Dryer breaks down? Call the apartment building manager. Fixed within 24 hours at NO COST to them.
2. They can keep saving their downpayment. Many places will let you move in with $500 as a security deposit.
3. No special assessments. No suing the developer (in some buildings.)
4. Don’t like the view after all? Just move when the lease is up.
5. Decide the South Loop is not their cup of tea after all? Just move.
6. Get a new (and better job) in NYC? Just move.
I could go on and on.
Buying a 2/2 is only slightly better than buying a 1/1. At least if you have a kid you can live in it a lot longer (and it’s probably easier to rent out if you have to move.) But most people aren’t going to live in the property long enough to make up the transaction costs (and that’s only AFTER real estate has actually stopped declining- which hasn’t happened yet.)
Every day I look at properties that people bought in 2008, 2009 and 2010. I’m sure the people who bought in 2008 said, “we’re going to live there 4 years. We’ll be okay.” And instead, they’re losing their entire $100,000 downpayment. Just like THAT.
If you’re buying a house or some other property you know you’re going to be in for the long haul- then by all means go for it. Prices have come way down and loans are cheap. But if you’re not going to buy for the long haul- you’re either renting from the bank or renting from the landlord. Same difference but you have a LOT more to lose renting from the bank.
“Is the market so unsteady in the South Loop that you would recommend just renting for the next 4-6 years?”
SLoopRenter- if you haven’t been reading Crib Chatter for very long- check out the “market conditions” postings (you can search for all in that category on the site.) Our chatter there pretty much tells you what the market is like in the ENTIRE city of Chicago. Also check out Gary Lucido’s blog as he tracks inventory levels and has a lot of good stats.
“I am not familiar with South loop, but why 1307 and 1322 are much more attractive?”
Just from looking at the listings, they look so, so much better in the units on the market than the subject property. Larger, nicer, etc. I’m not going to spend a lot of time finding out if that’s really the case, it was just my first impression.
“Yes- just go ahead and lose money. Everybody’s doing it!”
Well, your position seems to be that, since there were so many declines in property values in the last decade, it’s CRAZY to buy property because you could lose money. Of course, you could lose money, but that has never changed. You could also make money, you could also break even. A lot of people thought like you did (“the current trends and conditions will continue indefinitely”) in from 2000 – 2005, and that’s how they got screwed.
A savvy person who needs a place to live should consider the expected value of their utility (in the economic sense) and costs related to homeownership vs. being a renter. Sure, if you want to make arguments in numbered lists about all the things you couldn’t do while a homeowner, you’ll be able to make such a list, just like you could for the things that you can’t do as a renter. My point is that your kneejerk “ZOMG how could you ever buy a property now” puts you in a specific camp of people I talked about a few weeks about in my “triple dipping” post. You’re so traumatized by the reality of market fluctuate that you can’t use reason and logic to make decisions. You use emotion. That might be right for you, but it’s not right for everyone, and it shouldn’t be advice that you’re giving.
Another point: do you realize that, if you are comparing the monthly cost of owning (which includes principal payments) vs. renting, you need to reduce the basis you’re using to determine that one is losing money by comparing sale prices to sale prices? Given lower interest rates, it’s much more pronounced these days. After five years of a floating rate mortgage at current market rates, you’ve already paid down more than 10% of the mortgage after the first five years, so make sure to include that in your calculations when thinking about these issues.
“What’s the difference if they live in the Astoria Towers as renters OR they buy a smaller (and probably less nice) 2/2 in some other building?”
I will leave this as an exercise to the reader, but THIS IS THE WHOLE POINT. Owning and renting are different activities and have different benefits and detriments.