Chicago Tribune: Oprah Sells Her Streeterville Condo for a Huge Loss
May 29th, 2012 categories: Chicago Real Estate News
Oprah puts Chicago co-op unit for sale; prepares to suffer big loss
There’s no bigger Chicago celebrity than Oprah Winfrey. It stands to reason, then, that when Winfrey puts her Chicago condominium on the market, the move will attract attention.
And so it has. The Chicago Tribune recently reported on the media giant listing her eight-room, 4,607-square-foot Streeterville co-op unit on the market.
Winfrey listed her unit in late May. The asking price? A seemingly high $2.8 million.
It may seem silly to follow the real estate moves of the rich and famous. But these days, such listings shed light on the state of the Chicago housing market.
For instance, the Tribune reports that Winfrey’s asking price of $2.8 million is less than half of what she paid for the unit in 2006, a time that just happened to be at the height of the real estate boom.
In other words, Winfrey will take a big loss when she sells her unit. And in that, at least, she’s not much different from most other Chicago residents who purchased condominiums or single-family homes in 2004, 2005 or 2006. Those were heady days in the city, with housing prices soaring. Owners who purchased then and have to sell now are feeling the same pain that Winfrey will feel when she finally sells her unit.
After all, housing values in Chicago — as they have across the country — have fallen dramatically since their highs in 2006.
Winfrey has tried to sell this unit in the past, listing it for $6 million from the summer of 2008 through January of 2009. Needless to say, the listing did not generate the kind of offers for which Winfrey was looking.
I don’t know if it makes today’s sellers feel any better that the most powerful local celebrities — everyone from movie stars to sports heroes — are taking losses on their Chicago home sales, too. But at least it shows that even the richest among us are feeling the pain of a challenging housing market.
| Discussion: No Comments »
Housing Foreclosures Remain Too Common In Illinois
May 25th, 2012 categories: Chicago Real Estate News
Housing foreclosures continue to be a real problem in Illinois. And that’s unfortunate news for owners hoping to sell their Chicago condominiums and single-family homes; until foreclosures are moved off the market, home values in the Chicago area will not rise.
The latest bad news regarding local residential foreclosures comes from Chicago Tribune real estate writer Mary Ellen Podmolik. In a recent story in the Tribune, Podmolik covers the grim foreclosure news from the Mortgage Bankers Association.
According to the association’s latest numbers, nearly 7.5 percent of mortgage loans on one- to four-unit residential properties in the state were in some stage of the foreclosure process at the end of March of this year.
If that sounds like a high percentage, that’s because it is. According to the Mortgage Bankers Association, the national average for such residential properties being in the foreclosure process was a far lower 4.39 percent.
The Tribune story quotes Jay Brinkmann, chief economist of the Mortgage Bankers Association, who said that Illinois trails just Florida and New Jersey when it comes to the percentage of residential properties in foreclosure. The foreclosure rate in Illinois is, surprisingly, more than twice that of California’s. And remember, California is a state that was especially hard hit by the national recession.
Part of the problem — the biggest part, actually — is that it takes Illinois so long to close out its foreclosures. According to the Tribune story, Illinois is one of those states that have legal systems in place that prevent the timely resolution of foreclosure cases. Other states are able to work through their foreclosure backlogs more quickly. And in those states, housing prices are finally starting to rise again.
However, there are those who say that Illinois’ process, which requires foreclosures to go through the court system, provides greater protection for homeowners. Overall, there are 21 states that, like Illinois, require foreclosures to go through the court system. According to the Tribune story, 11 of these states have foreclosure rates that are higher than the national average.
There is a balancing act here. By making foreclosures go through the court system, Illinois is taking steps to protect the rights of homeowners. At the same time, by making sure that foreclosures remain in process for a longer period of time, the state is also making it more difficult for housing prices in Chicago and its other markets to rise.
| Discussion: 1 Comment »
New Office Tower Plans A Good Sign For Chicago Economy
May 23rd, 2012 categories: Chicago Real Estate News, Economic Recovery, Housing Market
Want proof that Chicago’s economy is heading in the right direction? Just look at the plans for River Point, a 45-story building that might become the biggest new construction project in the city in five years.
Bloomberg recently reported on the plans for River Point, an office tower that, if current plans are followed, will cost $300 million for Hines, an international property investor, to build.
Hines plans to build River Point in downtown Chicago on the banks of the Chicago River at Lake Street. The project will boast 900,000 square feet of space and is due to be completed in 2016.
So far, River Point doesn’t have any specific tenants attached to it. But excitement is still building over the office tower, mainly because River Point will be the biggest new construction start in the city since 2007.
The plans for the tower come as the Chicago office market is slowly starting to rebound from the national economic slowdown. During the first quarter of this year, the downtown office vacancy rate fell to 15.1 percent, according to numbers from commercial brokerage Cushman & Wakefield. During the same quarter one year earlier, this rate stood at 16.4 percent.
Bloomberg quoted an official with Chicago’s Appraisal Research Counselors who said that there is more optimism this year regarding downtown Chicago. This same official said that real estate professionals are more optimistic about downtown Chicago than they are about the city’s suburban markets.
Those looking for better times in the Chicago housing market should be happy to read about River Point. New construction is a sign that real estate industry veterans believe that better times are on the way for Chicago’s economy. And that can only help homeowners who are hoping for housing prices to eventually start rising again.
| Discussion: No Comments »
Fannie Mae Report Offers Hope For Housing Industry
May 22nd, 2012 categories: Economic Recovery, For Buyers, For Homeowners, For Sellers, Housing Market
It’s not been easy to see the positives in today’s housing market. But they are out there. For proof of this, there’s the recent outlook by mortgage-finance giant Fannie Mae.
Fannie Mae recently reported that the early months of 2012 have been good to the U.S. housing market, according to a recent story by the Wall Street Journal.
The report noted that consumers are more optimistic about the housing market today, and are more willing to put their homes on the market. As a result, the sales of single-family homes and condominiums across the United States should rise by slightly more than 7 percent in 2012, said Doug Duncan, the chief economist of Fannie Mae.
According to the Fannie Mae outlook, consumers are reporting that they believe this is a good time to sell their homes. That’s a big change. Sellers have been pessimistic about the housing market, both in Chicago and across the country, since late 2006. That’s when housing prices began to fall, and when sellers found that the housing market had transformed into one that strongly favors buyers.
The increase in optimism among home sellers may be a good sign. But the housing market still has a long way to go before it hits a more robust recovery.
As the Wall Street Journal story says, consumers are still reluctant to spend. That’s because many of their incomes haven’t risen — and in many cases have shrunk — since the United States fell into recession. At the same time, many consumers are still either unemployed or worried about losing their jobs. Consumers won’t make the financial commitment to own a home, and add monthly mortgage payments to their financial responsibilities, if they’re worried about their monthly incomes.
In other words, it all comes back to the strength of the U.S. economy. Until consumers see unemployment fall and their own incomes start to rise again, the housing market recovery will remain a sluggish one. And unfortunately for us, unemployment has been a particularly stubborn problem in this country.
| Discussion: No Comments »
Business Leaders Give Emanuel Strong Marks For First Year As Mayor
May 21st, 2012 categories: Chicago Info/News, Chicago News, Economic Recovery
It looks as if Chicago Mayor Rahm Emanuel is on his way to becoming a favorite of city business owners, at least if a recent survey by Crain’s Chicago Business is to be believed.
According to a recent story by Crain’s, about three out of every four respondents to the survey said that Emanuel has been either very positive for Chicago businesses or has been positive but “could do more.”
Crain’s reported that only 9 percent of respondents to its survey said that the new mayor has been bad for business during his first year in office.
This is good news for homeowners in Chicago. We want businesses to view the city as a friendly, progressive place. We want them to think of Chicago as a city that welcomes new businesses to its borders. The more businesses that call Chicago home, after all, the more attractive the city becomes. And the more attractive Chicago is, the greater the number of people who want to live here.
That greater demand, of course, can only prove positive for the Chicago housing market.
The majority of respondents say they support Emanuel’s efforts to reduce crime, balance the city’s budget, promote jobs, reform Chicago’s public schools and promote ethics reform.
Of course, this doesn’t mean that all is well in Chicago. Emanuel, after all, has only been in office for a year. The city still faces challenges when it comes to falling home values, pension issues, crime, traffic congestion and, of course, unemployment.
Other respondents said that it might not matter what Emaneul does if the state legislature in Springfield doesn’t, as one respondent told Crain’s, “get their act together.”
Still, the survey is an encouraging one for Chicago residents. Let’s just hope that businesses continue to view our new mayor as favorably as his time in office runs on.
| Discussion: No Comments »
