Crib Chatter

The lists of units for sale in Avenue East at 160 E. Illinois continues to grow.

The current sales statistics for the building (out of 133 units):

• 40 units for sale (or 30% of the building)
• 17 units for rent

From what I can tell, no flips have sold in the building.  Some flippers put their units on the market last summer – even though closings began only three months ago.

There is currently one price reduction.  I love it when agents “lower” the price $100 or $1,000 just to get the “price change” designation on the listing.

Lame!

Unit #2005: 1 bedroom,  1.5 bath,  1070 square feet

• Sold this fall for $494,900
• Originally listed for $555,627
• Currently listed for $554,627 (I can’t tell from the listing if this includes the parking spot or not.)
• Jefferson Realty has the listing

Some analysts of the Chicago market believed that investors made up at least 30% of the buyers in the downtown condo market.  The closings on these new buildings (that started selling units during the “peak” of the condo market in 2004 and 2005) should give us an indication as to how accurate that number was.

American Invsco is converting the former apartment building at 200 N. Dearborn in the Loop into condominiums.  According to Crain’s:

The one pending acquisition by a condo converter, American Invsco Corp.’s plan to buy the 46-story tower at 200 N. Dearborn St., could move into early January. That’s because of slow condo sales and not the debt market turmoil, says Arnold Schepel, the Chicago-based company’s vice-president of advertising and marketing.

If the sale closes next year, 2007 would be the first year a condo converter didn’t buy an apartment building downtown since 1997, according to CB Richard Ellis.

American Invsco has the building under contract, and has sold about 150 of the 309 units since it began marketing to residents in May and the public in July, says Mr. Schepel.

The days when American Invsco, which also converted The Sterling at 345 N. LaSalle and River City at 800 S. Wells (as well as the Loftminium World loft project in the South and West Loop and several high rises in Lakeview, among other developments over the years) could just open up a sales center and sell a conversion in a few months are over.

The conversions I see selling right now are those that are trying to give buyers every amenity.

200 N. Dearborn, outside of having a pretty nice Loop location, lacks just about everything else. The real killer for sales is that there is no in-unit laundry, a virtual “must have” in the condo market today.

But you can’t fault Invsco for trying.  They are, yet again, offering one of their condo incentive programs to “investors.”  This time they’re saying:

ASK ME HOW TO GET A PARKING SPOT FOR ONLY $5,000 AND TURN YOUR INVESTMENT INTO A 5 YEAR CASH FLOW FREE OF PAYMENTS

Apparently, no one is currently buying. Where are all the European investors?

Just wondering.

Prices range from  $283,000 for a 590 square foot 1 bedroom and up to the low $500,000s for the two bedroom, two bath units.

200 N. Dearborn [website]

The Vetro, at 611 S. Wells, in the South Loop near Printers Row, has started closings.  The 233 unit building is only 50% sold.  Last week, the developer began advertising “free parking” to new buyers.

The free parking is a huge price reduction on the units.  For instance, the developer currently has a $250,000 1 bedroom, 1 bath on the market.  Throw in the $35,000 parking for “free” on that unit and it is essentially a 14% price reduction.

Happy Holidays flippers!  You’re scr*wed.

There is no way a flipper can compete with that kind of incentive.  Which is maybe why I’m not seeing that many flips for sale so far.  Most of the flips are for rent.  Craigslist has several, including this 720 square foot one bedroom for $1850 a month (plus $150 a month for parking).

The flippers in this building have little choice but to rent out their units and wait to see if there is appreciation in the next several years.

The October pending home sales were released this morning and showed a slight increase in October from September.  But, compared with October 2006, sales were down nationwide 18.4%. In the Midwest, sales were down from September by 1.4%. They were down year over year by 11.7%.

From the Wall Street Journal:

NAR chief economist Lawrence Yun said the worst part of the credit crunch has been accounted for in the data, and that mortgage conditions have gotten better. “Some postponed activity should turn up in existing-home sales over the next couple of months, and I expect sales at fairly stable to slightly higher levels,” he said.

NAR is expecting sales and prices to rise weakly in 2008 and for the market to return to normal appreciation in 2009.

Whew. Glad that this “crisis” is over.

The Columbian, at 1160 S. Michigan, which started closings several months ago, has seen dozens of attempted flips.  I’ve talked about a few in prior posts.  “Attempted” is the key word here because from what I can tell, nothing has re-sold in the building.

I don’t think they’ve finished closings in the building so more will come on the market.  (Anyone know?)  I drove by the building in the evening a few days ago and was shocked at how few lights were on in the building.

The current sales scene in The Columbian (out of 221 total units):

• 42 units for sale
• 17 units for rent

The building was not sold out by the developer when closings began, which is making it more difficult for the flippers. 

But this latest flip is so inspiring that it brings a smile to my face.

You have to admire this owner.  It takes some guts to try to flip for nearly a million dollars in this market. 

Question is: why do they think this unit is worth that?  Look at the pictures below.  You be the judge.  Does it inspire you?

Hm…me neither. 

Unit #4201: 3 bedrooms, 3.5 baths,  3400 square feet, direct lake views

• Just sold for $1,600,000
• Flipping it for $2,555,000
• Listing says it has, thank goodness, subzero, viking and bosch appliances
• Two parking spaces included

Deborah Thomas at Coldwell Banker in the agent.

Because I’m tired of all the negative housing news this week, I thought I’d chatter on a unique single family home that is for sale.  I don’t know how much it cost the owner to buy, nor do I know what they spent on renovations.

I just think this is a cool house.  Who would have thought such a modern home was behind the door of such a stately 1896 Greystone Gold Coast mansion?

Do you like (or hate) the funky bathroom sinks and the yellow kitchen?

No granite, marble or 42 inch oak cabinets here.

44 E. Cedar: 4 bedrooms, 4 baths, 5500 square feet

• Currently listed for $2,950,000
• No garage! 

Melinda Jankovich at Coldwell Banker has the listing.

The Helmut Jahn modern skyscraper at 600 N. Fairbanks in Streeterville is still not fully occupied.  They are probably about a third of the way through closings on the building.  There are 227 units.  The flippers, however, have been out in full force.

An updated count of the units for sale and rent:

• 20 for sale
• At least 3 for rent

(Some of the units may be for sale AND for rent)

Six of the units for sale are 1 bedroom units of which there were 5 on nearly every floor.  There will be a lot of competition to flip the one bedrooms because more of them are going to be listed for re-sale.  It’s no surprise, then, that the first price reduction in the building is on a 1 bedroom unit.

Unit #1404: 1 bedroom, 1.5 baths, 873 square feet

• Sold in November 2007 for $385,000
• Originally listed for $449,000 plus $55,000 for parking
• Reduced to $425,000 plus $55,000 for parking

A cheaper 1 bedroom was just listed.  Unit #1603 which is the same square footage and baths as #1404. It is listed for $410,000 plus $60,000 for the parking.  The listing insists “Priced for Buyers- This is Not a Flip.” 

Rubloff has that listing.

The most expensive 1 bedroom is listed for $499,500 (and yes, it’s the same square footage as these units that are $75,000 to $100,000 cheaper.)

Foreclosures are now hitting the heart of downtown.  A foreclosure auction is scheduled on a one bedroom unit today at The Heritage, at 130 N. Garland Court near Millennium Park in the Loop.

The Heritage is the building that started the Millennium Park craze and revitalized the loop as a residential destination for “luxury” buildings.  It’s a large building with 356 units.  The east facing lake and Millennium Park units are the most valuable but I’ve been in the west facing (or city view) units and they are very nice.  There is a great vista of the interesting downtown skyline from the west facing units (although you do hear the brown line El loud and clear below the building.)

The building has done well since originally closing in 2005.  Original owners have been able to flip and make some money, especially those on the east side of the building.  Lately, however, appreciation has slowed.

This is why I’m surprised to see a foreclosure in the building.  Not because homeowners in the building couldn’t get into financial trouble.  No.

But because they should be able to sell and get out of the trouble.

This one bedroom is going to foreclosure auction at the Cook County Courthouse today:

Unit #2410: 1 bedroom, 1.1 baths, 900 square feet

• Originally sold in April 2005 for $339,500
• Sold in September 2005 for $394,500
• Auction price of $331,218

I can’t find any record that it was listed recently for sale.  It appears that the owner wasn’t trying to sell to get out of the mortgage crunch.  The cheapest one bedroom unit currently on the market is one of the smaller one bedroom units.

Unit #2108: 1 bedroom, 1 bath

• Sold in February 2005 for $348,000
• Currently listed for $349,000 plus $45,000 for parking

In September I chattered about Unit #5701, a penthouse unit with a lofty price of $4.4 million that I said was trying to set a new price point in the upper bracket for both the building and the Millennium Park area.

Apparently, the area isn’t quite ready for that price.

The unit was just reduced to $3.8 million.  Stay tuned.

The “plan” the President outlined today is non-binding on the mortgage industry.  Here’s more from Newsday:

Bush said that 1.2 million people could be eligible for help under the plan, developed in negotiations with the mortgage industry led by Treasury Secretary Henry Paulson. But only a small fraction of that number will be subject to the rate freeze. Others would get assistance in refinancing with their lenders and moving into loans secured by the Federal Housing Administration, Bush said.

And the help only comes to those who ask for it, he said.

Thousands of borrowers who are falling behind on their payments have been sent letters about the options, and Bush also urged people to call a new hot line: 1-888-995-HOPE.

The plan targets homeowners who have been keeping up with payments, got loans in 2005 through July of this year and will face problems when their interest rates are scheduled to rise between next January and July 31, 2010, according to several wire services.

You gotta love the phone number!

Here is an example of someone who hopes they are helped by the plan:

Freeport homeowner Barbara Santamaria says she hopes she’ll fit the mold because she and husband, Alex, who have three children, already pay $3,700 monthly on a $414,000 loan, whose 7.5 percent from the summer of 2006 will go up to 10 percent in August.

Referring to the plan, Santamaria, 37, said, “That would help tremendously.” Without a freeze, she said, “I’m done. There’s nothing I can do and there’ll be no way I can keep the house.”

My question is- who will be sitting down with all of these homeowners to see if they qualify? There is going to be tons of bureaucracy.

Will this “plan” help or do more harm?

It used to be, before the boom, that living in funky units in far out locations meant it was dirt cheap.  Ten years ago, you could buy a condo in Printers Row for $80,000.  The first wave of gentrifiers was rewarded with price appreciation.

Not anymore.

Described in the listing as “3000 square feet of supurb luxury” this condo in Bronzeville at 40th and South Michigan Avenue is on the second and third floors of a commercial/residential building.  In the listing for a unit on the first floor listed for $219,000, it states:

FIRST OF EIGHT BRAND NEW 1000 SF CONDOS. PERFECT FOR OFFICE, RETAIL, NON-SURGICAL MEDICAL. OPPORTUNITY TO GET IN BEFORE THE AREA REALLY EXPLODES. RAPIDLY DEVELOPING AREA AND BLOCK ON PERSHING RD. BEAUTIFUL BUILDING. CURRENTLY RAW SPACE, DELIVERY AS VANILLA BOX OR BUILD OUT NEGOTIABLE. CONVENIENT TO X-PRESSWAY AND LAKESHORE 3000 SQ FT LUXURY DUPLEX ABOVE;

They renovated the second floor, putting in bosch appliances (of course!) and “brazilian cherry floors.”

Is it enough to make you shell out the big bucks in that neighborhood?

Unit #2: 3 bedroom, 2.5 bath, 3000 square feet, duplex up

• Currently listed for $509,000
• Assessments of $150 a month
• First Chicago Realty Corp has the listing