Trying to Sell 3 Years Later in Lincoln Park: 2762 N. Lincoln
This 3-bedroom unit at 2762 N. Lincoln in Lincoln Park has been on the market since October 2010.
It is currently listed for $31,000 under the 2008 purchase price.
The unit has 1675 square feet on one level with an east facing balcony.
It has hardwood floors throughout the main living area.
The kitchen has granite counter tops and stainless steel appliances.
After 5 months, what will it take to finally sell this property?
Ron Knoll at Saffron Realty has the listing. See the pictures here.
Unit #306: 3 bedrooms, 2 baths, 1675 square feet
- Sold in May 2001 for $416,000
- Sold in April 2008 for $480,000
- Originally listed in October 2010 for $449,000 (included the parking)
- Currently still listed for $449,000 (includes the parking)
- Assessments of $303 a month
- Taxes of $7060
- Central Air
- Washer/Dryer in the unit
- Covered parking
- Bedroom #1: 16×13
- Bedroom #2: 13×11
- Bedroom #3: 11×10
Cheap windows, “bad” track lighting and awkward tray ceilings in a relatively new building: perhaps 100K less would do. Ugly unit.
The interior is a disappointment but this is still newer construction with all the bells and whistles, in a super-prime neighborhood.
Don’t understand why it can’t get at least $400K.
This looks like a nursing home…and balconies are too ornate and heavy looking for the rest of the building. Architecture fail.
I remember when this building went up and thinking it was one of the ugliest new contruction I’d seen at the time. Terrible curb appeal and sub par unit, but neighborhood is great.
I think $375K or less is the right price. The finishes on this place are awful! Does anyone know if the building has an elevator?
“This looks like a nursing home…and balconies are too ornate and heavy looking for the rest of the building. Architecture fail.”
“I remember when this building went up and thinking it was one of the ugliest new contruction I’d seen at the time.”
Yep. One of the worst new buildings in the area. I’m not sure if Sabrina pic cutting off most of the ground floor retail makes it look better or worse.
Nice stumbling distance from Delilah’s, tho.
I actually really like this. Good size, slightly overpriced though. CA. WD. Parking.
This is also on the top floor? Quick walk to El. Great hood. Decent assoc fee’s…biggest downside is no view/obstructed views of bricks.
Who really cares about the track lighting. That can easily be replaced.
“This is also on the top floor? ”
There is ground floor retail. I would be surprised if this isn’t the 3d floor out of the 4, but sometime developers number things oddly.
sooooo ugly!
So, which would you rather have a window with a view of a brick wall, or one of those half walls found in lofts?
“So, which would you rather have a window with a view of a brick wall, or one of those half walls found in lofts?”
Real window with no view.
Wow. If this place were in Uptown I’d be all over it. 😉
Seriously though, it does look like a nursing home.
Wow – I’m surprised. I think the white balconies are beautiful. Three bedrooms on one level is a plus I don’t often see.
“Wow – I’m surprised. I think the white balconies are beautiful.”
Where in the South did you grow up?
They really are odd on that stretch of Lincoln. Doesn’t so much make me think “nursing home” as it does “apartment building in suburban DC/Atlanta/Texas”.
uh those of you complaining about the view – this place must be on a corner, right? Wouldn’t you rather be on a corner with an extra wall of windows, than in a unit that only has a balcony? I think this place is nicely done. Nice big open living room with lots of light, plenty of room for a true dining room table, big bedrooms and bathrooms with good bones, and a small 3rd br that would make a good office. Nothing spectacular, but a grade above one of those cinder block duplexes for sure. Only thing I think is a serious negative is the boring kitchen with the support beam.
Sonies – it’s kinda cool though to have a window facing a brick wall instead of actually having a brick wall in your place! That is, as long as all of the views aren’t obsturcted – good for an office or similar
I know it’s from Zillow, but the commentary is like an enlightened and reasonable discussion of the things CC screams about all day…
There’s something in here for everyone!
“More Homeowners Are Underwater, Now Here’s the Good News …”
*video*
http://finance.yahoo.com/tech-ticker/more-homeowners-are-underwater-now-here%27s-the-good-news-…-535913.html?tickers=xhb,len,tol,kbh,^dji,fnm,fre
wow people are harsh
Lots of Light, Lots of windows for fresh air, lots of open space, good ceiling hieght, good sized rooms, coverd parking, low ass fee, balcony, bedrooms with REAL walls and windows.
How is this a bad place?
BTW its not top floor the top floor balcony windows have an arch window on top
“Nice stumbling distance from Delilah’s, tho.”
Thats just about the only positive I can see about this property. Everything else makes me want to gouge my eyes out.
Other than the bland architecture, this place has good bones and the square footage is hard to find. The unit is a little dated, but with some minor updates it could be a winner. All it needs is some paint, rugs, and new lighting. A couple of grand would totally change this place.
from the picture it looks like it belongs on Northwest Highway somewhere….
I don’t like most of the interior aspects: column in the middle of the kitchen. Ugly over mount sinks almost everywhere and as pointed out earlier the horrendous lights. I think if one spends 30K on this place it can be decent so not sure why everyone hates it so much. Not my cup of tea but it is not that bad, is it?
Right miumiu, I’m not RE bull thats for sure, but this place is just becoming reflexively negative about every property, all the time. This place needs to freshen up a bit.
I’ve been railing about how ugly those balconies are for years, so I’m glad to know others agree. Those faux concrete support things that hold up the railings (ha- no pun intended) look like chess pawns on steroids, crowded together to fight off the queen. There’s a renovated building in the Gold Coast with the same look — so unfortunate. I’m told it’s necessary to “crowd” them to meet code so that babies’ heads don’t get stuck between them…
I LOVE LOVE LUV THIS PLACE. SNAP IT UP BEFORE IT’S GONE!
“#Joe I on February 10th, 2011 at 2:39 pm
Right miumiu, I’m not RE bull thats for sure, but this place is just becoming reflexively negative about every property, all the time. This place needs to freshen up a bit.”
“There’s a renovated building in the Gold Coast with the same look — so unfortunate. I’m told it’s necessary to “crowd” them to meet code so that babies’ heads don’t get stuck between them…”
I thought it was for the safety of the owner’s lhasa apso or yorkie
Very few of the regulars on here will ever be satisfied. No matter how good a deal is someone will always poo-poo it as being too expensive. They basically want the unicorn property that doesn’t exist…
The single family home or 3/2 condo with good architectural details with CA, 2 parking spaces, Lincoln Park, good school district, at least two blocks from the train but no more than 4 blocks. Granite, stainless, no track lighting, deck, top floor, room for 8 person dining room table, hot single neighbors into swinging, no renters, no broke or poor neighbors, no section 8 housing within .5 mile, plenty of street parking, 2 blocks from lake, lake views, roof top deck, no hollywood lights in bathroom, neutral colors, never lived in, allows pets, doesn’t allow pets, view of air show, 5 minutes from work, 4 minutes from trader joes, 3 minutes, from whole foods, 2 minutes from favorite bar, and 1 minute from gym and starbucks. Property must be at least 2000 square feet and the listing must have floor plans. the deal has to be done without a Realtard unless she is hot.
best of all.. cant be more than $99,000 which is still too much because there will be cheaper deals tomorrow.
Oh yeah… absolutely must be on the Brown line.
“hot single neighbors into swinging”
Russ can you help me start a coalition so we can get this criterion added to the MLS to make our searches easier?
““hot single neighbors into swinging”
Russ can you help me start a coalition so we can get this criterion added to the MLS to make our searches easier?”
L M F A O
Someone pls organize
russ
much love my friend
just what i needed on a day like this
I’m personally troubled at how as I was reading Russ’s comment I kept ticking off in my head “must have, must have, must have, must have…”
You mean when I seriously start looking I’m not gonna get all that?
I can’t believe this was built 10 years ago. It still looks “wrong” to me when I go down this stretch of Lincoln. I am an old.
Those railings are unfortunate, but this is nice-sized place in a great location and the interior isn’t any uglier than most new(ish) construction.
Also, Russ made Diet Coke go up my nose. He is a bad, bad man.
I was wondering how many people would catch that… 🙂
Groove, I swear I was thinking about you last night. I was watching Beat Street and I kept imagining you as Ramo.
“I was wondering how many people would catch that…”
I didn’t until Bob pointed it out. BTW, I thought swinging required couples. How can you be single and be into swinging isn’t that just menage a trois where two of the participants are married?
“Groove, I swear I was thinking about you last night. I was watching Beat Street and I kept imagining you as Ramo.”
Not that there is anything wrong with it, but I got the wrong idea until you mentioned the second part of the sentence…lol
Looks like the place is under contract. Maybe being posted on CC was all it took to sell it! 🙂
wow – under contract today!! What a coincidence! CC might be the best marketing tool out there. Joe Zekas watch out!
Well, I thought it looked ok so I am not surprised. If you read the posts here nothing should ever sell…lol
I agree that this is ugly, but the location is pretty great. I think it sells high 3s if the sellers want to move it now or low 4s in the early summer.
As others have commented- it went under contract today (verified by the agent.) So apparently it is selling now- and not by early summer (baring some sort of funding delays.)
What the selling price will be is the big mystery…
Looks like a great unit, and the rumored buyers should be very happy about their purchase. But oh good gosh, I know it’s a favorite on here, but the “can’t even give units away in LP” thing, when the unit is located practically on Diversey about a mile west of Halsted…ugh, I don’t want to be the “ELP” guy who starts this fight yet again, but location, location location…
“Groove, I swear I was thinking about you last night. I was watching Beat Street and I kept imagining you as Ramo.”
Russ, the greatest movie ever, a graff head’s bible.
my gi joe was gi jerk with a kung fu grip that dont even work…jingle jangle jingle for the po’, once i get my welfare check you can kiss my mistletoe, ho ho ho, ho ho ho
i learned to do the beach ball from that movie. (beach ball is diving into a helicopter and popping back to your feet). im old but still can b-boy “somewhat”
Y’all are hilarious!
Yikes, I didn’t realize my taste was so bad if everyone hates this so much. I really liked it and could have totally seen myself living here. I’m 24 and single though; it is probably a bit out of my price range.
P.S. I grew up in the South, maybe that has something to do with it as the previous poster commented on?
What do you think the equivalent rent would be on this place?
“What do you think the equivalent rent would be on this place?”
I’ll take a guess and say about $2500 to $2700 a month.
Groove… the battle at the Roxy is hands down one of the greatest dance scenes in any movie.
I’d probably throw my back out if I tried any of that stuff nowadays though. I still would give Mr. Wave a run for his money though… LOL
Yall are crazy. Wild Style >>>> Beat Street
“As others have commented- it went under contract today (verified by the agent.) So apparently it is selling now- and not by early summer (baring some sort of funding delays.)”
Alright! That comment seems like a dig at me, sorry I didn’t call the agent or refresh after having the post up for 30 minutes. I say $399k but wouldn’t be surprised up to about $420k or so.
“Yall are crazy. Wild Style >>>> Beat Street”
Breaking 2: electric boogaloo >>> Wild Style >>>> Beat Street
“I still would give Mr. Wave a run for his money though… LOL”
Russ,
with all the arthritis setting in i dont think i could pop or lock anymore 😉
I did get drunk last year and tight rolled my pants attempt the air jordan. you should have seen the 20 year olds look on thier faces.
“when the unit is located practically on Diversey about a mile west of Halsted”
Racine is .5 mile west of Halsted.
On vacation…can’t believe I’ve missed a Beat Street related discussion.
“I say $399k but wouldn’t be surprised up to about $420k or so.”
Sorry, jjj, only your first guess counts toward earning a gold star:
“I think it sells high 3s if the sellers want to move it now or low 4s in the early summer.”
G – what perverse pleasure do you get out of being so negative all the time?
G – my comment seems pretty consistent with my prediction. I said high 3s, which 399 is and it already went under contract so they were obviously moving it. However, like I’ve said, I think that the bottom is here and/or passed for a lot of the local market, an I wouldn’t be surprised at all if someone bought this for $410k or somewhere around there. You might try adding a little nuance and detail to your rhetoric instead of your standard “prices lower tomorrow” unbounded and unquantified vector of a philosophy.
JJJ – be extremely careful with your bottom prediction because the bears will enjoy throwing egg on your face in a few months. I know I will take particular joy doing the same.
The CS Chicago index has been declining for a few months in a row now and in some cases, at least over some of the last few months, the rate of decline appears to be accelerating. This is a very precarious time to be calling the bottom just as housing prices have resumed their precipitous declines.
Do not forget that even hurricanes have have what is called the eye of the storm where the sun will even shine through for a brief period of time before the storm resumes. Granted the second half of the hurricane is never as brutal as the first but it’s an experience nevertheless. That’s where are today and that is the perfect analogy for what the Chicago market is about to experience.
Chicago sfh fell 2.0% from sept to oct; and 2.2% from oct to november. This doesn’t look like any sort of bottom to me, not when precipitous accelerating price declines are introduced iinto evidence.
HD, I posted this on another thread and was wondering what you all think?
“I wonder if we will be go back to crazy interest rates of eighties and huge price reduction for the housing market. I am starting to think we are still 20-30% away from the bottom:
http://www.nytimes.com/2011/02/12/business/12housing.html?_r=1&ref=us“
““I wonder if we will be go back to crazy interest rates of eighties and huge price reduction for the housing market. I am starting to think we are still 20-30% away from the bottom”
We’ll see but I personally doubt it. To state that we are 20-30% away from the bottom is a big drop in price, talking ~100k on a 400k place. Current owners will not go for that. Distressed owners maybe or on toxic assets.
What is more likely to happen is the banks will reduce the criteria necessary for obtaining a loan – knowing that they will make more $ due to the increased rates. More risk but more reward.
“What is more likely to happen is the banks will reduce the criteria necessary for obtaining a loan – knowing that they will make more $ due to the increased rates. More risk but more reward.”
I totally agree – easing up on credit requirements is already in the works. It may take a year, but by then, interest rates will have increased making it even more worthwhile for banks to loan money.
“That’s where are today and that is the perfect analogy for what the Chicago market is about to experience”
You are not going to be able to get an “awesome” place for dirt cheap…it’s just not going to happen…do not expect to be able to buy the “perfect” unit for dirt cheap.
Sure, if you want some small cookie cutter POS, then yes, prices are still going to drop a bit because they are still slightly inflated. For something “special” or “cool” or “different” though, I do not forsee it happening.
Miumiu, I can’t read the article but I assume it relates to the federal governments support for fannie and freddie waning.
I doubt we’ll have craxy interest rates of the 80’s but rates may rise relative to risk.
I figure 90-100 on the cs scale is the bottom.
Afeds suggestion that sellers wont go for lower prices is wrong. Todays underwatwer sellers are tomorrow’s short sales. 50% of all homes in ttheUS don’t have mortgages. They can sell for whatever price they want and undercut the underwater sellers.
a-fed is totally right – all of the data quoted on this site are averages and take into account neighborhoods that most people who visit this site would never live in. I have been saying all along that nicer places in nicer areas are NOT going to go down in value – in fact, I think they will really start increasing in value because there may be a lot of competition for these places.
“They can sell for whatever price they want and undercut the underwater sellers.”
Sure, and I CAN do a lot of things, doesn’t mean I will. Those people with no mortgages aren’t going to sell lower unless they need to – an unlikely situation.
Regarding the underwater sellers is a different story, as they are either going to keep truckin or unload the debt from the books anyway they can. If it’s their only home though, they need to find another place to live obvi which will spur growth in the market. If they short sale, their credit is shot which will make it very difficult to secure another loan.
“JJJ – be extremely careful with your bottom prediction because the bears will enjoy throwing egg on your face in a few months. I know I will take particular joy doing the same.”
I think that this is where we are different. I’m extremely careful with my money. When it comes to predictions, I’m just saying what I actually believe, which beliefs are informed by data and analysis. But I’m not too concerned about not saying what I believe to be the case just because people on the internet will consider me to have egg on my face if I turn out to be wrong. A lot of people on CC seem to be self-styled gurus who wax nostalgic with lot of truisms and general theories about why things might be this way, that way or some other way, but have never really given much of a statement about what they believe about anything broader than whether a property would be good for them. As an economist, investor and consumer, I’m interested in real estate as a market and a good. The machinations about this and that don’t interest me nearly as much how much something is worth when, whey it is worth that and how that value could change. I hear your predictions about additional large drops and “accelerating rates of decline” (which no one cares to define with any precision) and I think that you are much more likely to be wrong than I am. That’s why you have your beliefs and I have my beliefs.
Yes, HD it is about the feds stopping support for mortgages. A-fed interesting point. I don’t know but I am starting to get a cold feet.
“However, like I’ve said, I think that the bottom is here and/or passed for a lot of the local market.”
jjj, You might try adding a little nuance and detail to your rhetoric instead of your standard “the bottom is here and/or passed” philosophy.
I have posted plenty of data and analysis in support of continuing declines. I have yet to see any data or analysis out of you. But, you sure do spew bs, though. Economist? That seems about right, lol.
1.5% drop from August to September. 2.0% decline from September to October. 2.2% decline October to November….
How much more precise than this can you get? Prices are declining every month more than the previous month.
Sort of like when a knife is falling, the speed at which it falls increases until it hits the floor….
“totally agree – easing up on credit requirements is already in the works. It may take a year, but by then, interest rates will have increased making it even more worthwhile for banks to loan money.”
But isn’t “easing up on credit requirements” EXACTLY one of the things that got us into this mess in the first place? I don’t understand why you’d think that’s a good thing. You’re looking for folks to be able to again borrow over there means to repay?
WTF?
HD.. Not sure if the Aug-Sept is an every year thing but i would expect the declines from Sept forward, in Chicago, on a basic seasonality basis. Just sayin..
The CS index is an average of the current month plus the previous three months to smooth things out.
“gringozecarioca on February 12th, 2011 at 8:05 pm
HD.. Not sure if the Aug-Sept is an every year thing but i would expect the declines from Sept forward, in Chicago, on a basic seasonality basis. Just sayin..”
“A-fed interesting point. I don’t know but I am starting to get a cold feet.”
There is always some associated risk, miumiu, when making a purchase like this. Just find something that YOU like, that YOU think is the right price and pull the trigger. Be happy with your purchase and don’t look back.
“But isn’t “easing up on credit requirements” EXACTLY one of the things that got us into this mess in the first place? I don’t understand why you’d think that’s a good thing.”
Absolutely! But they need to ease up a bit right now…not for the people with a home already that wants a another one or a vacay house, but the ones that need it. If you can put 10 or 20% down, have good credit, can make the monthly payments, and overall wisely choose a home, there is no reason why you shouldn’t be allowed to purchase it.
“The CS index is an average of the current month plus the previous three months to smooth things out.”
HD, it’s like you’re not even trying. You know better:
1. Fact that it’s a moving average doesn’t do much to address zecarioca’s seasonality question.
2. What would actually (at least start to) address the question is to note that the case shiller numbers you cite *are* seasonally adjusted.
3. It’s a 3 month moving average, not 4 month, but that is a nit.
“Sort of like when a knife is falling, the speed at which it falls increases until it hits the floor….”
RUFKM??? This statement is completely wrong!
All things fall at the same rate regardless of height. 9.81 meters / sec. This is Newtows Law of Universal Gravity.
(The only resistive force is wind outside a vacuum – such as if you drop a sheet a paper or a feather as an ex. If you drop a house, a horse, and a hooker, they will all be falling at the same velocity).
I took his example as meaning the change in velocity, not acceleration. The rate of acceleration remains constant, but the velocity and distance traveled per second increase (due to the rate of acceleration). I’m no engineer, but I believe thats a pretty basic concept. Of course you may have a new way of looking at it.
“All things fall at the same rate regardless of height. 9.81 meters / sec. This is Newtows Law of Universal Gravity.”
“All things fall at the same rate regardless of height. 9.81 meters / sec. This is Newtows Law of Universal Gravity.
Speed would most reasonably be velocity (both generally and as used in the analogy), which increases. Acceleration (outside of friction etc.) is constant. Also ~9.81 per second per second (you missed the extra per second), which would give you the right units for acceleration rather than velocity.
What juliana and DZ wrote, which is what HD wrote.
A-fed, RUFKM!
I interrepted the example to infinty in regards to acceleration, meaning the longer the knife is falling, the quicker it will travel infinte bottom, which is false.
If my exmaple of a house, horse, and hooker regarding velocity related back to the units for the numerical constant stated is assumed (given the context), then it is indeed incorrect and should be stated as acceleration.
[sry for the knee jerk reaction too btw, need coffee]
No clue what you are trying to say there a-fed. Kind of doubt you do as well…
Oh, and I hope nobody took your advice on that penny stock you were touting last month…UWBK…No ChaChing! for u!
http://cribchatter.com/?p=9854
yeah thanx for reminding me juliana – I already apologized in a different thread. can’t get em all right. did you google a-fed + cribchatter…nice.
but I was close given they were one of the first ones to go – thinking maybe I should start shorting some of these banks on the cusp and that the gov isn’t goin to bail them out
yah no cha chia, no marble bathroom for me 🙁
Yeah, I remembered that. Sucks that what you post lives on, huh? Makes you think twice before hitting that submit button…
“did you google a-fed + cribchatter…nice.”
Oh, and google is also a very useful tool to use before you make a statement about something you are not an expert on. Like physics.
look, I overreacted and got it wrong – karma – but now you are adding insult to injury which there is no reason to.
And when I make those suggestions, its only because I have had to do those things myself. I don’t know how many times I’ve thanked myself for not hitting the submit button when I reconsidered it. I have learned to doubt my initial impressions.
Sorry, a-fed. Just the way you dissed HD without cause. You seem like a nice humble guy and I apologize. I’ve had to do that more often than I care to admit lately…
looks like I won’t be running for a position in the cribchatter cabinet after all…tear
(get the pun?)
basically… the market numbers look terrible based on a lagging indicator that should be showing strength when it is showing even more weakness…
its cool juliana, and I do apologze HD – as usual.
“Absolutely! But they need to ease up a bit right now… not for the people with a home already that wants a another one or a vacay house, but the ones that need it. If you can put 10 or 20% down, have good credit can make the monthly payments, and overall wisely choose a home, there is no reason why you shouldn’t be allowed to purchase it.”
There is currently no problem getting a loan under your example.
Yes, ze. Current sales volume and foreclosure filings are both showing more weakness, too.
how so G? I’m stating there are problems and the banks need to ease up for the people with criteria above who are having difficulty.
by doing so, they will encouter more profits (bank) but more risk and more expense (buyer) yet they get the house
it’s fair
How so, a-fed? What problems do you think they are having? I say that those with that profile are getting loans with no significant problems.
I thought for bigger mortgages we’ve moved up to 25-30% to actually get the loan funded? I’m thinking in the $500-800k range. Perhaps that could be the angle a-fed is thinking from to loosen the req. down to 10-20%?
There are definitely jumbo loans available to those with his profile.
I was speaking generally and in terms of the property, context to miumiu, that if you meet that critera and find a place you like, you should be able to buy it and securing a loan should not be a concern. I feel its still difficult to secure credit on condo’s in Chicago for example, new developments in the suburbs – even though that place could be a good fit for the buyer.
I mean be wrong again G (the way this morning has been going, I even burned breakfast and the gf was kicking me all night), but things have gotten a little better, but by no means much looser right?
Reason I state this is because another one of my friends is trying to buy into 653 kings but is having trouble securing finacing with 20% down – to high debt to income with car/assesment/etc and 20% cleans her out.
“I feel its stil difficult to secure credit on condo’s in Chicago for example, new developments in the suburbs”
Not if they “wisely choose a home.”
“too high debt to income with car/assesment/etc and 20% cleans her out”
No cushion to “make the monthly payments” and did not “overall wisely choose a home.”
All apologizes accepted. I have a thick skin.
Here’s a blurb regarding foreclosures:
Wednesday, January 12th, 2011, 11:01 pm
Lenders filed a record 3.8 million foreclosures in 2010, up 2% from 2009 and an increase of 23% from 2008, according to RealtyTrac. But 2011 could be even worse.
RealtyTrac follows filings across the country that include notices of default, scheduled auctions and REO. The number in 2010 would have been higher were it not for the foreclosure moratoria banks announced in October when employees were found to be signing and filing affidavits improperly in what has become known as the robo-signing scandal. RealtyTrac CEO James Saccacio said as many 250,000 foreclosures will likely be resubmitted and added to the numbers for 2011.
http://www.housingwire.com/2011/01/12/foreclosures-reach-record-high-in-2010-realtytrac
Loan qualifying standards are mostly normal today in historical comparison. Bubble lending standards were the aberration.
That natl fc trend is representative of the Chicago Q4 & 2010 foreclosue numbers, also.
G – but we are not back to normal yet and still correcting from the bubble I feel. And wisely choose a home, this is in the eye of the beholder. What may be wise to you probably isn’t wise to me. She likes the place, can afford the place (depending who you ask), so she should be able to take the risk and get the place.
Excessive DTI ratio and the DP wipes out reserves? That is bubble era risk tolerance for a lender, not normal at all. No lender makes that loan without an MBS buyer or taxpayer ready and able to serve as a bagholder.
Nearly every person I met who bought 2007 and later, after learning that their house has lost value, says that they wished they waited another year or two to buy.
So go ahead, buy today because you can afford the payment and you like the place. And next year at this time when you find out that your home has lost value, you too will say “I wish I would have waited a year.”
but HD, in ten years plus whats the difference?
“And wisely choose a home, this is in the eye of the beholder.”
Yes, the lender is eyeing it, too. Your examples of condos and new suburban developments are not wise choices at all if too many renters, unsold units, and delinquencies are numerous and contribute to considerable downside risk.
G, we’re not talking overly excessive here, and the car is paid off in three years, plus the tax returns become returns cause she has some write offs, so to the bank, up interest due to the risk and give her the loan
“#a-fed on February 13th, 2011 at 11:26 am
but HD, in ten years plus whats the difference?”
10 years of property taxes, maintenance, and interest.
offset by equity and writeoffs
“but HD, in ten years plus whats the difference?”
This is a much simpler concept than the physics you attempted earlier. Do you really need help with it?
not 1:1 but…
no G, i’ll just let it go
“we’re not talking overly excessive here, and the car is paid off in three years, plus the tax returns become returns cause she has some write offs, so to the bank up interest due to the risk and give her the loan”
Raise the interest, which makes the DTI worse, so raise it again due to increased risk, which makes the DTI worse, so raise it again, …
Or, she can buy something for less today, or wait and buy what she wants today for less money tomorrow.
She should be charged a higher interest rate because of the higer risk. If default, the bank gets the property. It’s win win for the bank and she gets the place.
There will be a time to buy, it’s just that the time is not now, nor will it be for at least another few years. The smart thing to do is buy when foreclosures have slowed down significantly, volume has increased sustainably (absent tax credits) and DQ rates have fallen dramatically. Buy today for less than your neighbor did in 2004 and risk that your neighbor’s future short sale will undercut your planned sale 7 to 10 years from now. Basically, I believe that the market needs to rectify most mortgages (cashout refi’s, purchase money mortgages or second mortgages) made between 2000-2008 before there will be any semblance of stabilization. That means every 2000-2008 mortgage will need to be short sold, foreclosed, paid off, refinanced or sold by the homeowner at a loss before the market will have truly found a bottom.
HD – you may be too young to realize this -but the vast majority of people buy property to live in. They DO NOT want to wait a few years. Most are ok with not getting the cheapest price for a property – the trade off is that they have a better life in the meantime! For example a couple with three kids aged be nine and twelve do not want to wait five years to move. What’s the sense? For my in town, I could have saved two hundred k if I waited until this year to buy -but I would have lost out on three years of fun – I would never give that up. You really never know when you are going to get sick/die – you HAVE to live your life NOW!!!!!
If the bubble taught us anything its that default is not necessarily a “win win” for the banks.
“She should be charged a higher interest rate because of the higer risk. If default, the bank gets the property. It’s win win for the bank and she gets the place.”
Some people are a little more conservative than you, especially a couple with kids whose college will have to be paid for in ten years. Living for the NOW and not thinking about possible outcomes down the road would be a mistake for them. They might be more cautious than people with deep pockets such as yourself, and be willing to wait until prices stop dropping before plunging into home ownership.
“You really never know when you are going to get sick/die – you HAVE to live your life NOW!!!!!”
“If the bubble taught us anything its that default is not necessarily a “win win” for the banks.”
The banks over-vaulated the properities knowing they could bundle and credit default swap their way out; proper valuation and risk assesment were completely ignored.
And the bubble is arguably still deflating. Thus the tightened lending standards. Propping up lending with the GSEs (taxpayers) providing a backstop for future bank losses would make a lot of taxpayers, like me, angry. Why should I have to subsidize home ownership? I’m already doing it through the tax code. Enough is enough.
“The banks over-vaulated the properities knowing they could bundle and credit default swap their way out; proper valuation and risk assesment were completely ignored.”
“That means every 2000-2008 mortgage will need to be short sold, foreclosed, paid off, refinanced or sold by the homeowner at a loss before the market will have truly found a bottom.”
I’m finding this to be fairly true (depending on the neighborhood.) Already I am seeing 2008 purchases that are listed as short sales. It’s a real shame- but it’s going to continue to put pressure on prices.
But what about those who bought 2000 and 2001? That is 10 years ago. I’m seeing some of those come on the market now. It will be interesting to see how they fair.
Clio- while I agree that those who have 12 year olds just want to buy and live in their homes- most of them realize they will be in that property for quite some time. If you’re going to live there 10 or more years- then go for it and live your life. (And, I assume, are buying SFH.)
So should a professional couple without kids in their 20s buy a 2/2 condo somewhere right now when they are renting a 2/2 apartment anyway? This is the market that continues to get crushed. Are they going to live in the condo for 10 years? Unlikely.
“I have been saying all along that nicer places in nicer areas are NOT going to go down in value – in fact, I think they will really start increasing in value because there may be a lot of competition for these places.”
Clio- you mean the million dollar homes in Lincoln Park and Lakeview that have been on the market for 2 or 3 years now with no sale?
Soooo much competition for those places. Lots of buyers chomping at the bit to buy one, it seems. (just kidding.)
I really don’t know why you say these things when week after week on Crib Chatter there are numerous properties all in the “nicer areas” all selling for less than the prior purchaser paid (when they finally sell.) This is across all price points.
Chicago prices are down from the peak, at a minimum of 20% in the “good” areas to 50% or more in the “not-so-good” areas or those areas with a lot of foreclosures.
So that $1 million home in Lakeview is now “worth” only $800,000. Did the current owner put enough money down to sell for that kind of loss? Sometimes yes and sometimes no. That’s when we start to see short sales etc.
Can combination of tougher lending practices, higher mortgage rates, lack of government subsidies for housing (of course all these events are correlated) change our life style? I mean do we all want to raise our families in 3-4 bedroom houses further from the city center? Seems to me we are assuming American families will always choose space over city life. Maybe some of the people who still prefer living in the city, will accept to buy smaller places and make do with that.
“So should a professional couple without kids in their 20s buy a 2/2 condo somewhere right now when they are renting a 2/2 apartment anyway? This is the market that continues to get crushed. Are they going to live in the condo for 10 years? Unlikely.”
miumiu- don’t forget that middle and upper middle class families who choose to stay in the cities is a fairly recently phenomenon. Even when the city was first developed the nicer residential areas were usually on the outskirts, not in the center of the city. commuter trains cemented this. The city was full of tenement homes and slums. During the 10’s and 20’s and into the 30’s there developed some semblance of a middle class in the city, much of which fled during the 50’s 60’s and 70’s. ONly recently in a handful of areas on the northside has the ‘city living’ concept returned and as you can tell by the public schools, infrastructure and aldermanic prerogative, much has still stayed the same. I’d like to believe that this current round of gentrification will ‘stick’ in more places than just a handful of lakefront neighborhoods but only time will tell.
“don’t forget that middle and upper middle class families who choose to stay in the cities is a fairly recently phenomenon.”
You’re making stuff up again HD. This isn’t true, and it isn’t true of *any* city–they all have always maintained one or a few neighborhoods of UMC-types and some MC-types. There were always some nice neighborhoods (beyond the richie-rich) in Chicago, tho their location moved around and their size ebbed and flowed. The UMC-type areas are currently relatively large, in the history of Chicago, but I don’t think at late-19th c. max.
“Are they going to live in the condo for 10 years? Unlikely.”
why not, if by necessity?
its not “unlivable” FFS
under contract!!!!!