Market Conditions: Sun-Times: It’s a “Dream Market” for Buyers
The Sun-Times had a weekend cover story about how great the housing market is for buyers, especially first time home buyers.
For home buyers, it remains a dream market, and Realtors say they’ve seen a pick-up in activity as buyers look to take advantage of low interest rates and still-sinking prices.Twenty-five-year-old Sandra Becerra closed in February on a three-bedroom, 1½-bath tri-level home in Burbank she snapped up for $145,000. She said it originally listed for $220,000 two years ago. She put 5 percent down and got a 30-year, fixed-rate FHA mortgage with a 3.875 percent interest rate.
“It’s basically a new house except for the frame,” Becerra said. “It has new doors, new siding, a new roof, new floors, new kitchen appliances, cabinets. Both bathrooms are all brand new. That’s why I went for it because I just thought it was such a great deal. I didn’t really want to pass it up. I think it’s a very, very good time to buy.”
But as we’ve chattered about here at Crib Chatter, a large percentage of the sales are made up of properties that are REO or short sales.
“You have two basic people that are selling,” said Zeke Morris, operating principal and managing broker at Keller Williams Realty in Hyde Park. “One is folks that have owned in excess of 10 years and they can still have the ability to get out and make a reasonable return on their original investment. And then you have the other folks that are in some type of distress.”
About 70 percent of the sellers he has worked with in the past couple of years fall into that latter category, he said.
Among sales that took place in the Chicago area last year, 22 percent were bank-owned or in foreclosure, according to RealtyTrac. That’s an improvement from 2010, when 34 percent of sales fell into those categories and from 2009 when 40 percent did. But the dropoff last year is linked to a slowdown in foreclosures because of improper documentation, and the number is expected to rise this year because of a legal settlement with major banks.
This year, “more sales are going to be in the foreclosure and short-sale area,” said Loretto Alonzo, president of the Realtors association.
“The traditional seller, unless they have to sell their house, they’re still going to hold onto it because they don’t have the equity they need to move up into another house or they’re not just willing to accept the devaluation of the homes lately,” said Alonzo, broker owner of Century 21 Alonzo & Associates in La Grange Park. “They’re saying, ‘I will stay where I’m at’.”
But no one that the Sun-Times interviewed was ready to call a bottom just yet. In fact, just the opposite. Median price is expected to drop by another double digits.
As for median sales prices, he forecasts they’ll drop between roughly 8 to 12 percent from March through June and slide from about 4 to 7 percent in July and August, giving buyers more reason to enter the market as others have already done this year.
“Sales volume, the total contracts written, is up 67 percent in February of 2012 vs. February of 2011, pretty significant,” Bob Dohn, assistant manager at Coldwell Banker in Schaumburg, said of his office. “We’re seeing more and more activity. I’ve been busier than a one-armed paper hanger.”
Two things stick out from the article:
- The examples were all suburban buyers (where there appear to be some great deals)
- The two buyers they highlight are women (granted, just a small sample for the article’s sake, but interesting nevertheless)
Is it a dream market for buyers if prices continue to fall and/or they’re subjected to buying properties in some kind of distress?
What would be a true “dream” market?
Home buyers face dream market as house prices fall to new lows [Sun-Times, Francine Knowles, April 7, 2012]
After refinancing several properties and trying to buy several more, i have to say that I am NOT that happy and upbeat about real estate for one main reason: OBTAINING FINANCING!!!
I just went through the biggest nightmare refinancing my personal residence. In terms of refinancing, I don’t know many more people who would be better qualified for a mortgage, and, despite having an EXCELLENT mortgage person, the amount of paper work I had to submit/fill out was nearly 1000 pages (it was something like 879 pages) and still not done. This included tax returns, bank statements, rental agreements, etc. – and this is for a loan (on my primary residence) that was less than 1.5 times my income (and I had about 3 times the amount in liquid assets and 5 times the amount in non-liquid assets). This process started in Feb and I am finally closing today (after having to pay down the mortgage 60k).
I also was looking to buy a few places and getting a mortgage is SUCH a hassle now – not only because of the documentation, but because of the appraisals. Obviously, the main comps out there are foreclosures and I have seen MANY MANY properties come in very low on the appraisal side – which kills the deal. Unless they change the rules or something, I don’t know how we are going to get out of this mess (think about it – it is a vicious cycle – investors buy foreclosures on the cheap, and people trying to get a traditional mortgage are screwed bc their appraisal comes in too low and the mortgage company will only give them a mortgage if they pay more down, etc.
This happens every time there is a bubble that implodes. There is always this massive expansion of credit (though nothing like what we saw in the 00s) and there is then a proportionate contraction where almost no one can get credit. A wealthy young couple I know went through exactly the same thing in 1990 after the mini-bubble of the late 80s burst. They had a FICO of 800+ and a 30% downpayment for a house priced at $450K. The husband was an M.D. earning over $200K and they had inherited money. They had a history of successful home ownership, had sold a house in my city and were buying under their means. Yet, the stay-at-home wife was asked where she went to college by one lender. They applied to four lenders to get a loan.
From what I hear and read, everything getting financed now is either FHA , or has to be eligible for Fannie or Freddie purchase. 95% of the loans being made now are one way or the other government backed, which means it must be difficult-to-impossible to get a jumbo loan over the Fannie and Freddie thresholds. Were it not for FHA and the GSEs, the bottom would completely fall out of the lower end and middle tier markets. This is rather scary when you consider the rising delinquency/default rate for FHA loans that require 3.5% down and permit FICO scores as low as 580.
“it must be difficult-to-impossible to get a jumbo loan over the Fannie and Freddie thresholds”
Russ?
No mention in the fluff article that the combined seriously delinquent (90+ days late) + in the process of foreclosure inventory is something north of 11% of all mortgages in Illinois.
Because they’re not interested in presenting the facts they’re instead interested in swaying opinion.
“I’ve been busier than a one-armed paper hanger.”
how busy are one-armed paper hangers?
I just pulled the March numbers the other day: 1) closings up 12.1% over last year 2) Continued strong contract activity 3) 44.7% distressed (lower than last year) 4) record low inventory on a months of supply basis
http://www.chicagonow.com/getting-real/2012/04/maybe-the-chicago-housing-market-isnt-so-fragile-after-all/
“how busy are one-armed paper hangers?”
Not quite as busy as one-legged men in ass-kicking contests, but that’s not a family-friendly comparison.
So, we’re going with median price for calling the bottom? When there is a sustained increase in median price, we’ll be past the bottom?
Just to give you a sense of the inventory situation…last March 18,725 housing units for sale. This March 11,903. And activity is up. So what do you think is going to happen to prices all else being equal?
I got a jumbo recently. Not really a big deal. We have 800 credit and put down 20%.
“So what do you think is going to happen to prices all else being equal?”
If this were a “normal” market without about 50% of all sales being REOs/short sales, then I would answer that prices are going to go up.
But it’s not normal. The distress properties are going to lower prices for years to come. There is no way to get around it. The 2/2 condo owner who bought at $350,000 just can’t compete with the 2/2 in the building that is listed from the bank for $225k. Now maybe because of low inventory that bank owned 2/2 ends up selling at $250k. It still doesn’t help the $350k owner. He’s still stuck there for years.
SFH market is a lot more healthy (depending on the neighborhood.) But there’s the tricky part about qualifying for a loan over the FHA limit for most people.
Getting a mortgage is not that big of a deal if you have a job, good credit and a down payment. People say oh credit’s so hard, etc. but there’s something else going on. Like bad credit; or undocumented income, or other of balance sheet liabilities (child support, alimony, etc) because it’s seriously not that difficult for qualified buyers to obtain mortgages.
An extended family member of mine runs around complaining about how difficult it is to get a mortgage. I’m like “yeah, for you it is. you have sporadic work histories, no downpayment and abysmal credit. what do you expect?”
but it’s not fair this family member says, there are so many cheap deals, it’s far cheaper to buy than to rent in some of the areas this family member lives….too bad. Oh well, apply again in 4 years after you’ve paid all your bills on time and have saved more than a tax refund for a down payment.
“Oh well, apply again in 4 years after you’ve paid all your bills on time and have saved more than a tax refund for a down payment.”
This is the problem for 95% of Americans, right? They have NO downpayment. No savings whatsoever. FHA helps some people (since it’s only 3.5%) but even that is too much for some people.
The 2/2 for $250,000 doesn’t help families who need a 3/2 SFH in mt prospect is for $250,000. That’s going to be the death of the city going forward, far cheaper suburban housing. There will always be the holdouts who say in the city but other than a handful of neighborhoods, the gentrification ‘experiment’ across the northside, which primarily consists of either luxury SFH, or, cinderblock (or lofted) 2/2’s, will fail when there aren’t enough greater fools to purchase them. Why would a 26 year old couple buy a two bedroom condo in the city today knowing that in less than 10 years they’ll probably have a family?
well if 25 year old Sandra Becerra thinks it’s a “very , very good time to buy” what the hell am I waiting for. She can afford a $145,000 house! she must know her stuff!
“This is the problem for 95% of Americans, right?
It’s a huge problem for a lot of people, which means that the price of housing has to drop enough so those savings and credit challenged individuals can eventually purchase. The $80,000 townhomes that populate the suburbs in Schaumburg, etc, require only a large tax refund as a down paymemt; and the monthly PITI can be less than $1,000; which is less that what landlords rent them for (usually $1,200 or so).
Mortgages aren’t that hard to get assuming you are a pretty straight forward borrower – we can document income, assets, and have good credit. I actually think jumbos are easier than conventional financing now because most jumbo lenders can use a little more common sense since they aren’t beholden to Fannie/Freddie’s bureaucratic circle jerking when it comes to underwriting guidelines.
Yes, there is a TON of paperwork and most of it driven by government regs, lawyers, and banks trying to CYA.
What most people don’t understand is that if the banks don’t document things a certain way, no matter how stupid is sounds, the mortgage is essentially worthless because they won’t be able to get sold off without said documentation.
The process was streamlined during the bubble with stated income/asset products and unfortunately, all it did was invite fraud. Banks quickly figured out if you give an inch, someone is going to take a mile. So now everything has to be documented and must fit in a little box. There is no room for nuance.
The people I see complain the most are self-employed borrowers. More specifically, self employed who have creative accountants.
“More specifically, self employed who have creative accountants.”
Amazing how many tax refunds I’ve seen over the years for self-employed individuals who gross a fair amount but net little income on their tax returns.
“f this were a “normal” market without about 50% of all sales being REOs/short sales, then I would answer that prices are going to go up.
But it’s not normal. The distress properties are going to lower prices for years to come. There is no way to get around it. The 2/2 condo owner who bought at $350,000 just can’t compete with the 2/2 in the building that is listed from the bank for $225k. Now maybe because of low inventory that bank owned 2/2 ends up selling at $250k. It still doesn’t help the $350k owner. He’s still stuck there for years.”
It depends upon the building. Not all buildings have 50% distressed properties. Some have very few. And we’re heading into the time of the year when the % distressed properties falls.
Russ: “The people I see complain the most are self-employed borrowers. More specifically, self employed who have creative accountants.”
As a household who recently obtained financing and has a big chunk of its income coming from a self employed individual, I can confirm this to be the case. We didn’t even have a creative accountant and everything is, to the best of our abilities, above the board. But we needed a *ton* of documentation and getting confirmation of self employment was a real PITA. It worked out in the end, but the process was extremely painful and subsequently came a bit down to the wire for our closing date.
My mortgage agent was great, though, and helped a ton. He said that there has been a big uptick in people seeking financing but that many more people are having trouble obtaining financing than before the bust. Sourcing of funds seems to be the hardest aspect for most buyers, especially first time buyers.
I don’t have a lot of sympathy for someone who is illegally hiding income and then wants banks to trust them on their total income, including the amount they’re hiding and not paying taxes on, when it comes time to get a mortgage.
We just refinanced our mortgage and it was quick and painless (at Chase)
Here’s an observation I’ve made as someone in the market for a home in Oak Park or Evanston. I like to call it the contingency conundrum. When an attractive property comes on the market in these two areas, and it’s fairly priced, it goes under contract within a few days or weeks. The pricing is not what I, or most anyone on this site, would consider a “deal”. Looking more closely, in 90% of the cases, the property statuses are contingent rather than outright pending. I’m assuming this means that the buyer needs to sell their property prior to closing the deal on the target prop. To me, this feels like “false” contract activity. I.E. the buyer is saying, “hey I’ll buy your property at more than it’s really worth, but only if someone comes along and does the same for me”. What’s the chances of that? Lots of props that are listed for $600-700k range go contingent, but it doesn’t seem that they ever close. Again, looking more closely, they are still priced 15-20% higher than what would be considered deals. The sellers seem to hold out hope that their contingency buyers will be able to close their deal at near their asking price, but are probably turning off cash in hand buyers from seeing their props assuming that they’re spoken for. Will be interesting to see how it plays out.
* I realize that I don’t know what offers are in the cases above, but I’m assuming close to ask, given the how quick the status changes occur.
Anecdotal at best, but we just bought. We couldn’t sit on the sidelines any longer, and there was a marked difference in what we could afford from last summer, when we started looking, and this Spring. With Operation Twist ending in June, I don’t see rates getting any better. It is an election year, though, so there’s probably a pretty good chance we’ll see it extended.
scott-Same here, just refinanced at Chase it took all of 20 minutes at the bank.
The cash offers I’m hearing about are generally lowballs, very lowballs, like only 2/3rd’s of what the comps are. I know of someone trying to sell a property in the 600’s and has some financed offers in that range, but, has 2 or 3 lowball cash offers in the high 300’s and low $400’s.
I even have personal experience with investors submitting lowball cash offers *after* the property has already gone pending and a contract has been signed. Basically what they’re saying is “if you contract falls through, for whatever reason, we’ve got a lowball but back up cash offer waiting for you.” believe me, those offers fuck with buyers and sellers…the buyers are like “wtf I have a contract how can these investors do that!” and the sellers are like “we can close in cash in 14 days, wtf, why did we take this 45-60 days or more FHA offer!” Real estate is a cut throat business out there.
T – where did you buy, suburbs or city? sfh or attached?
“I like to call it the contingency conundrum.”
I don’t really know if this is going on a lot, or not, but a sale contingency seems like a pretty colossal contingency to me these days. I would be very surprised to find that a lot of sellers are going under contract with sale contingencies, since that means that all the other potential buyers are going to look elsewhere, even though the sale contingency might cause things to fail. My guess is that, if any data or anecdotes were available about sales contingencies, it would reveal that very few contracts have them these days.
Those who just refi’d with Chase, what did the refi cost you, either out of pocket or rolled back into the loan?
“Looking more closely, in 90% of the cases, the property statuses are contingent rather than outright pending. I’m assuming this means that the buyer needs to sell their property prior to closing the deal on the target prop. To me, this feels like “false” contract activity. ”
I also would like to know what experts and realtors think about “contingent” offers. Most of the stuff I loosely track on redfin seems to go “contingent”. What’s the real story here?
“Most of the stuff I loosely track on redfin seems to go “contingent”. What’s the real story here?”
I wouldn’t rely on the accuracy of Redfin data.
“Most of the stuff I loosely track on redfin seems to go “contingent”. What’s the real story here?”
Doesn’t every property go through this step after the inspections are completed and the actual sale price and deductions are agreed on, before the contingencies, usually just financing, are satisfied? I’m sure on of the real estate agents here can tell us the whole story.
just throwing this out there, I have noticed (in my ‘burb, park ridge) that the inexpensive, fixer-upper, ‘old people’ houses are getting snapped up within a week or two of listing. Then, instead of being torn down, they are rehabbed and back on the market as ‘move-in’ ready. Priced fairly, these homes sell quickly.
As far as easily getting a mortgage, we had to submit a blizzard of paperwork back in 2010. Hopefully that is not still the case, but it felt rather intrusive.
Mary, there’s a lot of demand at the lower end of the market in park ridge. but that’s pretty much true everywhere.
HD,
SFH in Oak Park. We’ll be putting 20% down with a conforming loan close to the limit, so we’ll get some first-hand experience with the mortgage process and appraisals. Who knows? We’re going to take a run at selling our LV 2/1 condo (at a loss, even if we go FSBO), but neither our offer or our financing is contingent on that. I expect you’ll be able to add us to the “reluctant landlord” cliche within a few months.
“I expect you’ll be able to add us to the “reluctant landlord” cliche within a few months.”
You made yourself a reluctant landlord, I had nothing to do with it.
All I’ve ever said is that each person has to deal with their situation individually because each situation is unique. You’re choosing to rent out your condo, while others in your building my choose to short sale or walk-away. You do what you have to do, and I can’t judge you, or anyone else for that. I wish you the best of luck.
T – pray that your appraisal comes back or else you’ll be bringing more money to the table than you thought.
“Doesn’t every property go through this step after the inspections are completed and the actual sale price and deductions are agreed on, before the contingencies, usually just financing, are satisfied? I’m sure on of the real estate agents here can tell us the whole story.”
Yes. Inspection, attorney review, mortgage contingency. No one in their right mind would take a sale contingency these days. That would be like 0% of the contingencies.
It’s my understanding that a property can’t be marked as PEND until there are no contingencies at all. If attorney approval & home inspection (A/I) is pending or you are not clear to close, (financing, FIN), then it’s going to show as CONT not PEND. Waiting for the buyer’s home to close is another possibility, but unless it’s marked accurately _and_ you can see the sub-codes in the MLS, there’s no way to tell. I assume that most of the properties listing as CONT are in fact waiting for financing.
Chase waived everything except about $300 on our closing.
‘“This is the problem for 95% of Americans, right?
It’s a huge problem for a lot of people, which means that the price of housing has to drop enough so those savings and credit challenged individuals can eventually purchase. ‘
I doubt that. Prices have to fall low enough that investors in the top 5% can buy and rent to the schmucks in the other 95%. People realize that the government is planning bulk ROE sales to investors this summer, clearing out some of that shadow inventory that everyone is afraid of? I’m not a housing bull, but I don’t think there’s any credible data that suggest prices are going to fall for years to come until people with terrible credit and no down payments can afford to buy.
http://www.cnbc.com/id/45925851/Government_Set_to_Sell_Foreclosures_in_Bulk
“1) closings up 12.1% over last year”
Did you exclude Chicago Ridge and Chicago Heights this month?
I have a 10.1% increase (1,630 vs 1,481.)
It’s my understanding that a property can’t be marked as PEND until there are no contingencies at all. If attorney approval & home inspection (A/I) is pending or you are not clear to close, (financing, FIN), then it’s going to show as CONT not PEND. Waiting for the buyer’s home to close is another possibility, but unless it’s marked accurately _and_ you can see the sub-codes in the MLS, there’s no way to tell. I assume that most of the properties listing as CONT are in fact waiting for financing.
Thanks everyone for the clarification, great info to know. If that’s the case, my view on the market and pricing is way more pessimistic than it should be.
I would most sellers would not accept a sales contingency at this point.
“No one in their right mind would take a sale contingency these days. That would be like 0% of the contingencies.”
So Gary et al, what would/should/could a seller do in the following scenario: property has been lingering on the market for 3-6 months, finally get a offer at or near ask contingent on sale of buyer’s property. And remember, no one is saying either of these people are in their “right mind”.
T: You’re about to close on a SFH in your desired location without the need to sell your condo. Provided that you can rent the condo for around the carrying cost, you should be thrilled. Don’t listen to the horror stories of “accidental landlording” peddled on here.
In a year or two, we’ll likely return to renting for a brief period, while we try to sell our condo, save a bit more, then buy a long-term home. But if we suddenly come into enough money to spring for a down without selling our condo, I’d happily re-fi the condo to a 15 year mortgage and play landlord. The place would eventually provide the down for a second home or fund a college education.
I have never felt this is a dream market for me. I have been looking to buy for a year and cannot really find a place I really like and can afford. There are not many new listings out there. I know we are very picky. The prices of some nice places like 340 on the Park and 600 N Lakeshore are not coming down at all. I hate renting and do not know how long I have to wait.
“but I don’t think there’s any credible data that suggest prices are going to fall for years to come until people with terrible credit and no down payments can afford to buy.”
It’s already happened in many lower socio economic neighborhoods. Cheap homes everywhere. But the buyer does have to improve their credit and save a tax refund or two. It’s not going to return to the days of 570 credit scores with 5% down; but the 720 scores with 3.5% is happening everyday. 3.5% down on a townhomes in the suburbs to formerly credit challenged or downpayment challenged buyers is happening everyday.
“property has been lingering on the market for 3-6 months, finally get a offer at or near ask contingent on sale of buyer’s property. ”
If I were the seller in this situation, I would let them pay $10k – $20k or so to buy the option to buy my place at an agreed price if it’s not under contract when they want to exercise the option, within six months or so. Or something like that, I’m sure that you could come up with a way to make it attractive for both parties. However, I’m not sure if options like that are enforceable or legal for real estate, and it might be a little costly to draw it up right. Maybe you could also just sell it to them on land contract, but that wouldn’t work for 99% of sellers, and you still have to maybe take it back if they can’t sell the other place and stop paying.
HD:”believe me, those offers fuck with buyers and sellers…the buyers are like “wtf I have a contract how can these investors do that!” and the sellers are like “we can close in cash in 14 days, wtf, why did we take this 45-60 days or more FHA offer!” Real estate is a cut throat business out there.”
HD,
Would you be willing to wait for 45 days to get 100k more for your house? I know I would. Your story just does not make sense to me. I’ve bid cash on a bunch of stuff near ask and it is going for 20k more to a (presumably) financed offer.
“Would you be willing to wait for 45 days to get 100k more for your house?”
Why would anyone be interested in that? Nevermind the $200,000+ in HD’s actual example.
What do you expect from the “new improved” Sun-Times? Accurate reporting? Check out Rob Feder’s blog in Time Out Chicago for the “scoop” on the new direction for this once-honored icon of Chicago journalism.
“HD,
Would you be willing to wait for 45 days to get 100k more for your house? I know I would. Your story just does not make sense to me. I’ve bid cash on a bunch of stuff near ask and it is going for 20k more to a (presumably) financed offer.”
I agree, and most people do wait the 45 days to get the $100k more or whatever. The example I was thinking of was a $200k finaced offer but a $150k cash offer. But that doesn’t stop the investors from submitting offers AFTER there is already a contract in place. i’ve seen it happen, first hand.
Jack – It is only a dream market for the cheaper properties. Places like 600 LSD and 340OTP are in high demand (especially 340OTP) and you will have to overpay to get a nice place in either of those buildings. My wife and I looked at both places before buying at Aqua.
People can submit backup offers whenever they want. You could submit an offer after it has sold ( to the new owner) if you want. But why would a seller accept it if they already have a perfectly good offer?
“dahliachi (April 9, 2012, 11:44 am)
People can submit backup offers whenever they want. You could submit an offer after it has sold ( to the new owner) if you want. But why would a seller accept it if they already have a perfectly good offer?”
Given the number of properties falling out of contract these days, for any number of reasons, the only ‘good’ offer is a cash offer, although they’re generally lowballs.
“Given the number of properties falling out of contract these days, for any number of reasons, the only ‘good’ offer is a cash offer, although they’re generally lowballs.”
DPOTW. And so early.
Steven, you are right that it is a dream market for cheaper properties. 340 OTP is in indeed in high demand. There is not even a single 3-bedroom for sale now. I think I have missed the bottom of this building for now. About 600 LSD, there are many listings, but the prices remain at the pre-crisis levels. I really do not want to overpay that much.
ur dumb.
“anon (tfo) (April 9, 2012, 11:49 am)
“Given the number of properties falling out of contract these days, for any number of reasons, the only ‘good’ offer is a cash offer, although they’re generally lowballs.”
DPOTW. And so early.”
“ur dumb”
Since you and I are both too old for textspeak, I read this as ur-dumb, like urquel.
Jack – There were a couple very nice 2,750 SE facing 3 bedrooms that were listed a month or so ago and went under contract in a matter of days. You have to be proactive to get a good unit there. Contact the owners before they’ve even listed the place and see if they’ll sell. Don’t plan on getting a deal in that building because it just won’t happen.
Yes. Inspection, attorney review, mortgage contingency. No one in their right mind would take a sale contingency these days. That would be like 0% of the contingencies.
Definitely not 0%. There is at least one property I am seriously considering with a home sale contingency with a kick-out clause. Though seller is holding from specific price, which I assume is the current under-contract price.
“Did you exclude Chicago Ridge and Chicago Heights this month? I have a 10.1% increase (1,630 vs 1,481.)”
Yeah, I used Broker Metrics which automatically excludes them. I pulled my data on the 7th so I had 1626 vs. 1450, which is what IAR reported last March.
“So Gary et al, what would/should/could a seller do in the following scenario: property has been lingering on the market for 3-6 months, finally get a offer at or near ask contingent on sale of buyer’s property. And remember, no one is saying either of these people are in their “right mind”.
I think I would tell them that they should come back back after they’ve sold their property. Even under a sale contingency the seller often maintains the right to continue to show the property so what’s the point? But JJJ makes a good point. You could structure an option purchase that would be attractive – at least for the seller – but then I doubt it would be attractive for the buyer.
“Definitely not 0%.”
Fine, probably like 5% of contracts.
If I were the seller in this situation, I would let them pay $10k – $20k or so to buy the option to buy my place at an agreed price if it’s not under contract when they want to exercise the option, within six months or so. Or something like that, I’m sure that you could come up with a way to make it attractive for both parties. However, I’m not sure if options like that are enforceable or legal for real estate, and it might be a little costly to draw it up right. Maybe you could also just sell it to them on land contract, but that wouldn’t work for 99% of sellers, and you still have to maybe take it back if they can’t sell the other place and stop paying.
10 day options are common in Dallas, TX real estate, not sure in Chicago. In TX, options are usually very low cost (under $500) and are used instead of home inspection and Legal review contingency. The option price is then applied to closing similar to earnest money.
Steven, I saw those two listings on 340 OTP. One was under contract in one day and paid in cash and the other around one week. Those units are beyond my reach and I can only aim for smaller ones. You have made a very good point. I should be proactive in my search, but I have never done this and my agent is relatively new and has not done this either. I am not sure how to do that. Any suggestions would be greatly appreciated.
“10 day options are common in Dallas, TX real estate, not sure in Chicago. In TX, options are usually very low cost (under $500) and are used instead of home inspection and Legal review contingency. The option price is then applied to closing similar to earnest money.”
I imagine that an appropriate option period to replace a sale contingency would have to be a lot longer in Chicago in this market – 3 months seems like it would be the minimum.
homedelete (April 9, 2012, 11:46 am)
Given the number of properties falling out of contract these days, for any number of reasons, the only ‘good’ offer is a cash offer, although they’re generally lowballs.
Not True, Given a lowish cash offer vs a ‘good’ financed offer, I have been seeing sellers waiting the 45 days and deals going through. The ‘contracts’ i see reliably fall though are short sales where the seller is engaged in price discovery. Lists for a very attractive price, goes under K quickly, remains under K for weeks or months and then falls out and returns to mkt. at a higher ‘bank approved’ price. Also there are some short sales I have been watching that have been under K for well over 6 months.
Jack,
Have your agent contact the agents of the current owners and see if any are interested in selling. All their info is in the mls.
My goodness, no one’s ever heard of hyperbole. the only good offer is a cash offer? come on guys and gals…
your condo in the GZ or you sending your kids to community college?
” The place would eventually provide the down for a second home or fund a college education.”
Steven, my agent has not done that. You made a very good point. I will talk to my agent and see if she can do that. Thanks a lot.
Jack: Fwiw here are three different recommendations: First is rely on your broker’s ability tho if they were what you need they already would have done what has been recommended. Second, hire a savvy experienced broker, enter into a buyer commission agreement (should be less than 5% (3%?) and still be part of purchase price tho) for broker to contact owners of units in the building you are interested in to inquire whether they are willing to sell or at least entertain an offer. Third approach: you research taxpayers of record for the units you would be interested in, find their contact info & either call or if you can’t find telephone contact info on whitepages.com or similar sites, send a letter expressing interest. In all instances I would highlight benefits of your approach to owner (primarily savings of cost and aggravation by selling without their contracting with a broker). Good luck!
Thank you, Southbound. I do not think I can hire another broker. She is a friend and I do not want to lose a friend. Also I have “wasted” a year of her time though I made a few decent offers. One offer I made was actually higher than what the seller eventually took. He rejected our offer and took a lower offer a couple months later. Unfortunately I did not know that at that point. Otherwise I may not be in the market now. I think I would follow what you and Steven recommended and ask if my agent can approach those owners either directly or through agents. Hopefully I can stop renting soon. Thanks again for your kind help.
“no one’s ever heard of hyperbole”
That’s Friday nights at Diversey River Bowl, right?
“Fine, probably like 5% of contracts.”
Since most families need their equity for the downpayment on the move-up, people are saying that in 95% of the cases the buyers have pre-sold their houses before making offers?? Where do they live in the meantime? I find this hard to believe.
You sell your place, put an extended closing period in the contract, and look and buy your new place in that time.
There aren’t that many buyers in the market who need to first sell their current home. Trying to pull that stunt these days means you better have some significant equity to make the current home easier to sell. The market is a lot of cash buyers, investors, first time homebuyers and downsizers, etc.
Steve: Understand your situation & good luck! So one final bit of advice is how I would manage her if I were in your shoes: I would first negotiate an equitable fee (3%?) to be paid by you if and only if there is a closing, but from sale proceeds (ie to be included in contract as an increase in price above price seller receives – you will need an HD type to write this). You are pointing her at potential sellers and she is assisting you buy rather than her traditional model of listing or cooping with listers. The other benefit to her is that in addition to potential commission on your buy she now may land listing(s) of unit(s) you do not want to buy. Then figure out which units you hope to own: ie; an 03 or 07 tier unit on 5th floor or higher or whatever units interest you. If it were me I want to focus first on most likely sellers – owners who listed previously but for whatever reason did not sell (this pops up in her MLS owner search). Then I would have her contact longtime owners. In both cases have her inquire if owner would consider selling and if they have an asking price. Then I would make blind non binding offers in letter of intent format contingent on viewing the condo. This is a hard, generally slow process with low likelihood of success but you will absolutely understand the buildings markets if other units are listed. The more owners your broker contacts the luckier you might become – even if # 2203 owner isn’t open to consider selling they may know of an neighbor who is. Finally I would also ask my broker to search online chancery records for cases that cite the relevant condo association as defendant – those point to likely foreclosures in your target building. Again good luck!
Thank you again, Southbound. I will definitely talk to my broker and give it a shot.
Why use a broker at all when you’re making offers on unlisted properties? Use a real estate lawyer. It will cost you up front and you’ll pay something for unsuccessful activities (probably the smart thing is pay a few hundred for a good “unsolicited offer” form, and then some amounts for working through blown deals), but you and the buyer will be saving 5% or so of the overall purchase price.
Also, I think that using a new agent who is your friend is not the most efficient way to do things, but I guess that I recognize that the fact that your friend is a broker means that, as long as you remain friends with her (since you think that she’ll stop being your friend if you don’t use her as an agent), she gets to be the one that collects the rent for this cartel. It’s kind of like knowing the guy who collects your protection money.
JJJ, I understand what you said. I would prefer to use a broker to buy a property., There are many nuances I do know about. A few years ago I actually used an experiences broker to search for a house in burbs and do not really see any difference. So why not work with your friend and let her collect the fee?
As long as you’re recognizing that in the unlisted situation, you’re basically paying 5% more than you need to, no problem. I like my friends a lot but not enough to pay them tens of thousands of dollars I don’t need to.
JJJ: The hardest part of process I described is gaining quick access to relevant information. Contacting owners is less efficient without access to info brokers readily access on MLS (owners contact info; how much they paid & borrowed and also whether their condo was previously listed/ for how much). And lawyer fees are an hourly, non-contingent expense. If I am in Jack’s position of already having engaged someone whose friendship I don’t want to lose, I’m willing to agree to contingently pay her if my purchase closes. It will be inefficient & time consuming for Jack to learn and do original research re ownership info. Imo paying a good broker should end up net saving him money in current market. I am neither a broker nor a lawyer.
“Why use a broker at all when you’re making offers on unlisted properties? Use a real estate lawyer.”
I said something wrong in my previous posting. There are actually many nuances I do NOT know about buying a property and would like a broker to help me through the process. When I wanted to buy a few years ago, I was priced out of the market and had to rent though I did not want to. I have worked with my friend for a year and cannot just ditch her to save money. It would be a different story if I had not used from the beginning. It is always nice to get 5%, even 2.5% off.
JJJ: Final comment by me since I need to earn a living – in my experience owners do not discount amount they are willing to sell their property for by 5% to unrepresented prospective purchasers (disclosure: while I am not a broker nor sales agent I routinely make purchase offers on real properties (mostly commercial), typically not currently on the market). Owners usually know what similar properties sold for and consider that the market value of their property. It is rare that owners undervalue their property & hard work to negotiate mutually agreeable terms of sale with most owners, particularly unmotivated owners ime.
“..in the unlisted situation, you’re basically paying 5% more than you need to…”
“Why use a broker at all when you’re making offers on unlisted properties? Use a real estate lawyer.”
Not even clear how and how much a broker is getting paid on unlisted properties, is it?
We never even bothered making any offers until we were under contract on my condo. It was frustrating heading out to 40 or 50 open houses last year and not being able to make offers on the 5-6 places that weren’t completely overpriced shite but it did educate us on what was worth it and what wasn’t worth it. Most of the crap were 400-500k places in the city and Evanston that *always* had at least a few things wrong with them — no AC, no driveway/garage, crappy kitchen, crappy layout, crappy basement, crappy bathrooms.
There were a couple places that we would have really loved (http://www.redfin.com/IL/Chicago/5246-W-Warner-Ave-60641/home/13478830 and http://www.redfin.com/IL/Glenview/645-Hunter-Rd-60025/home/13779265) and it was a bummer not to be able to move on them but when we found a place that fit all our criteria, we were able to move. Our sellers luckily accepted our closing contingency so we’ll go pending on the new place 6/1.
And I also had to basically submit everything but a colonoscopy even with an 800 FICO, 100k+ salary and 400k+ in other assets. Ugh.
Weird. Although the Sun-Times reports Sandra Becerra “put 5 percent down and got a 30-year, fixed-rate FHA mortgage,” the CCRD names someone else as the mortgagor.
If indeed now is a “very, very good time to buy,” one wonders why Ms. Becerra mustered only 5% down and needed to pledge the CCRD-named person’s creditworthiness to her lender.
But the weirdest thing of all is the Sun-Times’ decision to post sixteen (!) pictures of Ms. Becerra.
HD, my “accidental landlord” line wasn’t directed at you. You’re ok in my book. We’re probably going to lose a couple hundred bucks a month, at least at first, but we’ve made our peace with it.
“What would be a true ‘dream’ market?”
imho it’d be one in which credit risk was borne by the private sector, not the government.
“Not even clear how and how much a broker is getting paid on unlisted properties, is it?”
It’s probably clear that it’s too much.
off-topic: http://www.cityofchicago.org/content/city/en/depts/mayor/iframe/pensionestimatorsolutiontime.html
scroll down to the Chicago neighborhood list, see second listing for “V”.
That’s pretty funny Helmethofer. Well done.
It’s a real problem at that neighborhood’s street fest keeping the beer cups on those tables. Too many people turning to and fro.
“the CCRD names someone else as the mortgagor. ”
If different last name the bank of mommy & stepdaddy. And no the news article would never call into question that perhaps such people shouldn’t be held out as an example of savvy decision making and financial prudence. Although at 140k she’ll be fine.
“But the weirdest thing of all is the Sun-Times’ decision to post sixteen (!) pictures of Ms. Becerra.”
Wojo- So I wasn’t the only one who noticed this. ha! ha!
I kept clicking through as she posed in every room in her house because I thought they might show the other homebuyer mentioned in the article- but they never did.
ha! ha!
“There were a couple places that we would have really loved (http://www.redfin.com/IL/Chicago/5246-W-Warner-Ave-60641/home/13478830 and http://www.redfin.com/IL/Glenview/645-Hunter-Rd-60025/home/13779265) and it was a bummer not to be able to move on them but when we found a place that fit all our criteria, we were able to move. Our sellers luckily accepted our closing contingency so we’ll go pending on the new place 6/1.”
Tom- thanks for the examples. It’s nice to see some nicely redone properties being posted.
And this one’s for the hebe, who has become the resident Chicken Little regarding inflation & his arawack:
http://www.zerohedge.com/news/2012-2013-corporate-margin-bridge-one-word-magic
“And this one’s for the hebe, who has become the resident Chicken Little regarding inflation & his arawack:”
1- I don’t read zerohedge, or pretty much anyone else for that matter. Margins can compress or expand for more than one reason. It says little about price.
2- Not a hyperinflationist, have said that many times before, a 5-6% y/o/y grind will do all the damage necessary.
3- Definitely influenced by what I see around me. Just this week. Rio-highest concert ticket prices in world, highest priced 5 star hotels in world, median pricing in my hood is now US$1,820 per sq ft and bid! http://revistaepoca.globo.com/vida/noticia/2012/04/os-bairros-mais-cobicados-trecho.html
4-I feel a huge base increase and a low amplitude on money. If/when that amplitude increases it could be very interesting. All I know, is if the rock is pulled back on a slingshot, the safer place to be is not in front of the slingshot with the belief that the rock is on the other side. If I’m going to be wrong, I like my side. We can say your side gives Ze the heebie-jeebies. 🙂
We’ve been watching quite some time for a suitable 2/2 in the South Loop Museum Park, and noticed several possibilities come on the market a few weeks ago. We offered @ $300/sf on one (our view on what this upscale building should be selling at), and got countered at barely 2% off the asking. Some owners still come to the table with absurd expectations. Then another of the same tier but higher up came on the market, with a starting price much closer to the $300/sf mark. They countered a reasonable amount, and we’re now waiting to close.
All cash purchase, thanks to my undying faith in Steve Jobs.
Sellers took a beating on the unit from their purchase (original owners in this 5 year old building), but had already purchased a replacement in South Florida where they had given someone else a beating. So it’s a wash for them.
All the other overpriced candidates still sitting with no action. Two of them are in a similar position – they want to buy elsewhere, but think they should break even on their sale and get a deal on their purchase. With logic like this, they’ll be stuck for some time to come.
“Sellers took a beating on the unit from their purchase (original owners in this 5 year old building), but had already purchased a replacement in South Florida where they had given someone else a beating. So it’s a wash for them.”
Sorry to bring this up AGAIN- but I never understand this thinking. If they lost $100k on their sale in Chicago they didn’t make it up by buying somewhere else. The $100k is just gone. The price they paid for the new property isn’t relevant to the loss/gain side of the equation.
Housing prices have readjusted everywhere (except maybe Manhattan, parts of SF and DC.) They’re not coming back for decades. So it isn’t a “wash” for them. They’re never going to get the $100k back that they lost (or however much it is that they lost on the Chicago property.) Sorry to tell people.
But I understand that psychologically, sellers have to say something to themselves to convince them that it’s somehow okay to lose their shirt on the first sale. It would be like arguing about stocks: I bought a stock at $10 and sold it at $5. But I bought another stock at $20 that used to sell for $40 5 years ago so it’s a wash.
Huh???
No- it’s not.
This argument just irks me everytime someone says it.
“Huh???
No- it’s not.
This argument just irks me everytime someone says it.”
Not to me when the guy’s online moniker is Jim McMetz and Jim McMahon’s bank just went under and he personally was assigned blame for it.
Jim MecMetz = CC equivalent of Jim McMahon hahahahaha
Hey CC regulars who are also Bears fanatics I guess it’s _kindof a big deal_
http://www.courthousenews.com/2012/04/10/45490.htm
I would totally invest in a bank being run by a former Super Bowl quarterback hahahaha
“This argument just irks me everytime someone says it.”
Trading for equivalent properties I agree with you. If you are trading up I understand and accept the logic of the argument.
“Sorry to bring this up AGAIN- but I never understand this thinking. If they lost $100k on their sale in Chicago they didn’t make it up by buying somewhere else. The $100k is just gone. The price they paid for the new property isn’t relevant to the loss/gain side of the equation.”
Money is fungible. Unless you are emotionally attached to not losing money on a specific transaction, you’re better off if your aggregate financial condition is improved. Do you dispute that prices for larger properties have also fallen? Your personal biases are showing here. You are a housing bear, apparently because you are afraid of losing money on a housing transaction, when comparing purchase price to sale price. Other people consider all the financial and other factors related to housing purchases and sales. Why are you so surprised that the fact that larger and more expensive properties have depreciated more, on a nominal dollar basis, than smaller and less expensive properties, results in it being attractive for people to take a loss on the smaller property and make it up on the purchase of a new larger property? Don’t you recognize that housing as a good has far more than financial uses and consequences to peoples’ lives? Money is fungible.
“Don’t you recognize that housing as a good has far more than financial uses and consequences to peoples’ lives? Money is fungible.”
No, I don’t.
For the middle class- the loss of that $100,000 is a devastating event that will impact their financial future for decades. So to say, “oh- it’s okay- they made it “up” on the next transaction” is just WRONG.
Most homeowners can’t sell and have it be a wash because they have no other money to put down on the next property when they lose it on the first one. And yes- it IS a loss. And a big one. So to say, “but you can buy a bigger house now than 5 years ago with the same money”- is a bunch of crap to the person who just lost, basically, their entire net worth (or a large chunk of it.)
If you’re talking about the rich taking the loss- then, sure, it doesn’t impact their net worth quite as much. But who cares about them anyway? They are not the majority of this housing market.
And it has NOTHING to do with being a housing bear (which I’m not, actually, in many markets. If I were looking to stay in the burbs for the next 20 years- I would be a buyer right now.) As long as you’re going to stay in the property for a LONG time (and no, 5 years isn’t “long”) then you should go for it. We need to get back to what housing has always been- a long term commitment which costs a lot of money but hey- you have to have somewhere to live.
Is it because the $100K loss is mostly on paper unless they owned the home outright or were very close to paying off the mortgage? IN other words they lost $100K they should have been able to recoup based on previous comps and assuming they didn’t actually have to bring money to the table?
“Sorry to bring this up AGAIN- but I never understand this thinking. If they lost $100k on their sale in Chicago they didn’t make it up by buying somewhere else. The $100k is just gone. The price they paid for the new property isn’t relevant to the loss/gain side of the equation.”
“Is it because the $100K loss is mostly on paper unless they owned the home outright or were very close to paying off the mortgage? IN other words they lost $100K they should have been able to recoup based on previous comps and assuming they didn’t actually have to bring money to the table?”
A loss is a loss, realized or unrealized. In this instance it gets realized on the sale and the individuals balance sheet (must now) recognize this loss (which it should have recognized whether realized or unrealized anyway) . So it is literally a loss! No new transaction changes that. That’s her point.
see my 6:38 post. Sabrina is arguing in favor of the first sentence. JJJ is arguing in favor of the second sentence.
Ze says they are both correct but need to recognize the validity of the others argument.
Whew… now I deserve some bong time!
“For the middle class- the loss of that $100,000 is a devastating event that will impact their financial future for decades. So to say, “oh- it’s okay- they made it “up” on the next transaction” is just WRONG.”
You’re changing the argument and creating a straw man. We’re not talking about people who will have this $100k loss impact their financial future for decades – we’re talking about people who are able to turn around a buy a larger and more expensive property. No one is arguing that everyone is fine. Obviously, for people who can’t buy a new property at the lower prices, the big loss is not something that they can offset by a cheaper purchase price on a larger property. No one is saying that the housing market is fine since some people can offset a big loss with big savings on a new property. If that’s what you’re arguing against, you’re having an argument with yourself. The situation we’re talking about is the people who have in fact turned around and bought another property – the post you’re responding to spoke of people who “had already purchased a replacement in South Florida where they had given someone else a beating.” If you want to argue that only the rich can do that, fine, but don’t misrepresent the viewpoint you’re arguing against.
” ‘Don’t you recognize that housing as a good has far more than financial uses and consequences to peoples’ lives?’ No, I don’t.”
Well, this is a fundamental error. You view housing as a good like securities, or an asset like cash in a bank account. It’s not. It is very different. Appreciation and depreciation are relevant to housing, but so too are the costs and benefits of owning housing compared to renting equivalent or other housing. There are certainly markets in the Chicago area where I would expect the appreciation to be far greater over the next ten years than where I live right now. I am sure that you would say that a financially savvy person should seek out these markets with higher expected appreciation. You would be wrong, because housing as a good has far more than financial uses and consequences. The fact that I could triple my money (on paper, ignoring carrying costs, repairs, etc.) on a bungalow in Englewood is irrelevant to me. It’s not where I want to live, and the schools, amenities and the quality of the housing don’t meet my standards.
“we’re talking about people who are able to turn around a buy a larger and more expensive property.”
Yes, the relevant example is the stereotyped “live in the city til kids, move to burbs” folks who have teh following scenario:
2007: Buy a $500k 3/2 in LV
2012: Sell 3/2 for $400k;
2012: buy this:
http://www.redfin.com/IL/Winnetka/463-Willow-Rd-60093/home/13785593
for $990k (which was $1.3 in ’05, and likely would have been $1.5 in ’07). (interestingly, most of Winnetka is listed above last sale price, except in the ~$1.75 range, where it’s pretty even).
Those stereotypical people are coming out ahead. They also are–maybe–5% of the market.
I’m seeing distress all over the place in Lakeview recently. You can definitely tell the big banks were holding back and are moving forward in lockstep. It appears the wizard no longer has his curtain.
I get the whole ‘trade up’ argument. But that means they have little to no equity in the new place. Better hope daddy doesn’t lose his high paying job if that’s the case–just creating future distress for years to come. The FHA continuing to create time bomb mortgages in the illusion of keeping transaction volume anywhere near healthy levels.
Shut up bob and just buy already. Be a man.
I tell you HD when you can now get newer const 2/2 in old town w a garage like that listing on Mohawk…you might just be right. But I’ve got time. There will be no v-bottom but an L-one.
I feel bad for Sabrina, there is such crap on the market right now it has to be hard to find properties to talk about 3x a day… i’ve been looking on redfin just for the hell of it, and its all garbage I would never want to live in, or a location I’d rather not want to be at. The lack of comments lately is also probably indicative of the capitalistic inventory we are seeing all over the city
capitalistic = craptastic lol stupid spellchecker 🙂
“I feel bad for Sabrina, there is such crap on the market right now it has to be hard to find properties to talk about 3x a day.”
Thank you Sonies. It’s like pulling teeth every day.
I try not to find “boring” properties- but with this inventory? Good luck.
Tonight I’m going to talk about Lakeview distress, to rub the housing bull’s dog nose in the pile of shit that is finally being revealed.
Of the
84 properties listed in Lakeview over the past 9 days, 11 are distressed.
Also just look at all of the lemming sellers following the same exact strategy–I guess they still think sticking with the herd offers some form of safety LOL. 84 properties listed in the past 11 days. That’s almost 10% of total Lakeview inventory. These lemmings will be dumb as a box of rocks even past the point they run off the cliff–it will be until they hit the ground.
“84 properties listed in the past 11 days. That’s almost 10% of total Lakeview inventory.”
That is really nothing compared to prior years. At this time of the year there should be 84 properties being listed every single DAY in Lakeview. I’ve never seen it this slow in the 4 years I’ve been running Crib Chatter.
Also- the “new” properties listed many times aren’t really new. They are older listings that the agents just put on again as “new” to get them on the “new” list of properties that buyers get.
“Tonight I’m going to talk about Lakeview distress, to rub the housing bull’s dog nose in the pile of shit that is finally being revealed.”
Lakeview is probably one of the weakest GZ markets right now. I’ve seen bigger price drops there than in, say, Logan Square and West Town.
“I feel bad for Sabrina, there is such crap on the market right now it has to be hard to find properties to talk about 3x a day.”
Sabrina, in order for a property to be featured here, do you have to personally have visited the property and snapped a picture of it? Do you require permission from anyone?
I am in market of 2BR condo in Loop / River North / Lakeshore East area for past six months. Based on my observation, the prices, listing price atleast, have gone up atleat 50,000 dollars on average. Last summer, you could get a decent property in these areas for @ 270K, but no so anymore. I am seeing any good deals being snapped up quickly by cash offers / others who do not need conventional financing as I do.
Do you agree that prices / expectations have gone up significantly in the areas I have mentioned — probably the prices are on upswing. Or am I looking at it incorrectly?
“I am in market of 2BR condo in Loop / River North / Lakeshore East area for past six months. Based on my observation, the prices, listing price atleast, have gone up atleat 50,000 dollars on average. Last summer, you could get a decent property in these areas for @ 270K, but no so anymore. I am seeing any good deals being snapped up quickly by cash offers / others who do not need conventional financing as I do.”
Lost_angeles: I think it all depends on what building you’re looking in.
Does anyone else know if prices have gone “up” $50,000 in the last 6 months on 2 bedroom condos in Loop/River North etc.? I haven’t seen any appreciation like that in all the buildings that would have a 2/2s for $270k (like the Sterling, Admiral’s Pointe and others.) It all depends on the building and availability.
“you could get a decent property in these areas for @ 270K”
Of the newer buildings in LSE I think there was one or two distressed 1/1s last summer that went for around this or 245-265k but did not include parking. Not sure what they closed at but they went under contract fairly quickly. But iirc it was one or two units. That’s it. Certainly not a leading indicator for the overall market or neighborhood.
Prices up 50k in River North? Yeah I don’t think so.
The Loop itself is a tricky one because there aren’t many units. Of the non-newer luxury in the loop I can absolutely say the prices are getting slashed deeply to the point where I question whether the luxury premiums of 300+% can hold up longer term. Look at 5 N Wabash or 1 E 8th or 40 E 9th for instance. Loop pricing in this segment hasn’t been this low in a long time.
“Of the newer buildings in LSE I think there was one or two distressed 1/1s last summer that went for around this or 245-265k but did not include parking. Not sure what they closed at but they went under contract fairly quickly. But iirc it was one or two units. That’s it. Certainly not a leading indicator for the overall market or neighborhood.”
Lost_angeles wants a 2/2, not a 1/1.
There are simply too many buildings in these locations to say that prices are “going up” now everywhere. What about 208 or 212 W. Washington? Plenty of 2/2s under $270k in those buildings (usually.) I could go on and on about other possibilities. But maybe there are bidding wars on the foreclosures now or something like that that makes it seem like things are hotter.
I don’t have access to the data to know whether or not the 2/2 prices are going up “on average” in say, River North.