Archive for the 'Chicago Neighborhoods' Category
You might see more construction crews as you drive around the Chicago area next year. And those crews might actually be building new residential homes, at least according to a recent story in the Chicago Tribune.
Real estate writer Mary Ellen Podmolik recently covered the optimism that is starting to hit Chicago-area homebuilders. According to her story, 2013 could end up as a busy year for these builders.
Podmolik points to a national measure of homebuilder confidence. According to her story, this measure last month rose to its highest point since May of 2007. The hope is that buyers are ready to purchase new single-family homes again.
This would be some of the strongest evidence yet that the residential real estate market is making real headway in its efforts to climb out of its long funk.
Chicago-area homebuilders, after all, won’t invest in new housing construction if they don’t think there’s a growing market for it.
Podmolik points to the row homes in Chicago’s Lincoln Park neighborhood being marketed now by Belgravia Group. These homes come with a solid asking price of $1 million.
Podmolik quotes an official with Metrostudy, a provider of housing data. This source said that builders either think the Chicago housing market is at its bottom or that it’s near it.
Where does the optimism come from? Certainly not from the nation’s unemployment numbers. They rose, albeit slightly, in May. But Chicago-area home sales were strong in May. And after 49 months of year-over-year price falls, the Chicago-area market actually saw its median sales price rise. Again, the rise was miniscule — $100 when compared to the same month one year earlier — but the increase nonetheless represented a significant milestone.
Will this optimism help fuel a stronger recovery in the Chicago housing market? That’s a question no one is yet qualified to answer with any certainty. But we can all hope. And isn’t that what optimism is all about?
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Remember during the worst days of the nation’s housing slump when analysts found that home buyers were seeking out smaller homes? Seems that particular trend may prove to be a short-lived one.
According to a recent story by the Wall Street Journal, buyers today are more frequently looking for larger homes again. The Journal quotes numbers from the U.S. Census Bureau showing that the average size of a newly built home stood at 2,480 square feet in 2011. That’s up 3.7 percent from 2010.
The Census numbers represent the first annual increase in average new-home size since 2007.
The Journal story also quotes national home builder KB Home, which tells the Journal that the average square footage of the homes it now has under contract is 2,079. That is a jump of 13 percent from the previous year. KB Homes also told the Journal that a growing number of buyers are choosing home models that total more than 3,500 square feet.
What’s behind the move back toward larger homes? The Wall Street Journal suggests that it’s simply unnatural for a majority of home buyers to want small residences. The economic downturn may have inspired more buyers to go small. But the downturn didn’t kill off the passion U.S. residents have with homes that, the Journal says, are of the “supersize” variety.
Then there are the amazingly low mortgage-interest rates offered by lenders today. Buyers can still find 30-year fixed-rate mortgage loans under 4 percent. These low rates mean that buyers can get more home for less money.
There are still those buyers who prefer small houses. Just look at the number of books available today touting the benefits of living small. But the majority of homeowners want space, and lots of it.
This return to larger homes shouldn’t surprise housing industry watchers. Homeowners have always liked their residences big. It’ll take more than a massive economic slump to change this mindset.
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What makes Chicago such a great place in which to live? There are the varied neighborhoods, each boasting its own flavor. There is the eclectic mix of restaurants, bars and nightclubs offering so many different eating and drinking options that no Chicagoan ever has the right to be bored.
And then there is the fact that whenever you need anything in Chicago you can find a retailer who offers it, no matter how late or early it is.
This last point is important. We’ve all traveled. It’s unsettling to wake up somewhere in which you can’t run out in the middle of the night to pick up a bottle of aspirin or an extra tube of toothpaste.
Now our city has attracted yet another top-flight merchant. Crain’s Chicago Business recently reported on Detroit-based upscale grocery chain Plum Market Corp. making plans to open a new store in Chicago’s Old Town neighborhood.
This would be Plum’s first location outside its home state of Michigan. The grocer will lease about 28,000 square feet of ground-floor space in the 1233 N. Wells St. development, an apartment building containing 250 units.
A new grocery store in Old Town might not seem to mean much to owners trying to sell condos or single-family homes in Lakeview, Lincoln Park or Lincoln Square. But it actually does.
Buyers want to live in 24-hour cities. They want to live somewhere that is bustling and active. Chicago fits that bill, in part because of its thriving business community. Any time a new business makes plans to break into our city, we should all be thankful.
These are tough times to sell a condominium or single-family home, even in such a desirable city as Chicago. But once the economic recovery picks up speed — and it will, eventually — you can bet that Chicagoans will be poised to reap the benefits. Moves such as Plum’s offer yet more proof of this.
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You live in Chicago. When you wake up in the morning, do you look forward to your day? Are you ready to tackle the challenges that await? Or do you slam the snooze button and wish it was the weekend?
Forbes Magazine thinks that most of us Chicago residents fall into the latter category, waking up on the wrong side of the bed most days.
The magazine, which loves its lists, earlier this year ranked Chicago residents as the sixth most miserable in the country.
The reason for our grumpiness? According to Forbes, it’s the often brutal winters, the high property taxes and its terrible traffic. Forbes editors might have added that Chicagoans are struggling with a housing market in which home values continue to fall, but that hardly makes our city unique today.
Let’s look at the complaints listed by Forbes. Yes, our winters are usually harsh. But not last winter. In fact, last winter felt positively tropical. So we can scratch that one off the list, at least this season. The property taxes and the traffic, though, I’ll give Forbes. Traffic is especially a concern. Unless you’re taking the CTA or Metra, getting around town can be a true chore on busy weekdays.
But I think Forbes is still being too harsh on our city. Yes, Chicago can prove frustrating. But it can also be a fascinating place. We have great restaurants and live theater. We have tremendous green spaces and busy shopping districts. The night life is unrivaled here, and we have an abundance of professional sports teams from which to choose. We have as diverse an array of neighborhoods as any city across the globe.
In fact, it’s Chicago’s attractiveness that I think will eventually prove the savior our local housing market. People still want to live in Chicago. It is undoubtedly the top city in the Midwest. That bodes well for the future of the city’s housing market.
So, yes, Chicago isn’t perfect, as Forbes points out. But where would you rather live?
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Looking for a reason why it makes sense to buy a home today? Trulia, an online real estate portal, has a big one for you: The odds are that where you live it’s cheaper to own a home today than it is to rent.
And that includes residents of Chicago and its suburbs.
Trulia recently released its new rent-vs.-buy study, and the results were intriguing: In 98 out of 100 major markets across the country — including Chicago — it was cheaper for consumers to own a home than it was for them to rent.
The reasons for this? Rents are increasing across the country. They’re certainly rising quickly in Chicago and its suburbs. And at the same time, housing prices continue to fall, in Chicago and across the country.
Then there are the low mortgage interest rates, still around the 4 percent mark for 30-year fixed-rate mortgage loans. This makes it less expensive for buyers to borrow money to finance the purchase of a home.
This all combines to make owning a home more affordable than renting.
I’ve long said that this is a great time to buy a home. Look at our Chicago market. According to data from the Illinois Association of REALTORS(R), median home prices here were down 6.6 percent in February from the same month one year earlier. That translates to a median price of $141,000 this February compared with a median price of $150,000 last year at this time.
And this trend shows no signs of slowing. Housing foreclosures continue to glut the Chicago market. Foreclosures tend to drag down the median sales prices of homes throughout an entire area.
The Trulia study, then, provides yet more evidence that there’s rarely been a better time to buy a home, whether you’re looking for a condominium or single-family home in the Chicago area or across the country.
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