Archive for the 'For Homeowners' Category
Why Not Rent That Unsold Condo?
May 27th, 2010 categories: Chicago Info/News, Chicago Neighborhoods, For Homeowners, Renting in Chicago
It’s not easy selling a condo in Chicago these days. There are just too many vacant units on the market. Not surprisingly, a growing number of condo owners in the city are taking a bold step: They’re renting their units out for short-term stays.
Dennis Rodkin, the writer of Chicago Magazine’s Deal Estate column, tackled this issue last week. He wrote that the idea is gaining popularity among condo owners who are hoping to trim at least some of the costs associated with paying the mortgage on units they no longer want to own.
Rodkin cites a spokesperson from HomeAway, an online vacation-home rental company, who told him that the service had 120 listings in Chicago in April. That’s up 53 percent from the same month one year earlier. More importantly, the spokesperson mentioned that more than half of these vacation-home listings were city condos.
For vacationers, this is good news. Spending a week in a Chicago condo in Lakeview, Lincoln Park, Lincoln Square or just about any other hot city neighborhood makes for a great vacation. It’s a benefit for the owners of these units, too. They may not be able to sell their Chicago condos; but there’s no reason why they can’t at least collect a nice chunk of rent during the prime summer vacation months.
Unfortunately, not everyone is happy about this. Some condo residents worry that the increasing number of rentals will turn their buildings into party zones. Rodkin reports that the Chicago City Council’s Joint Committee on Zoning License is considering a new nightly vacation rental ordinance. If approved, the measure would force condo owners to pay licensing and inspection fees when they rent out their condos. The ordinance would also force them to pay taxes on their rental proceeds.
I understand the concerns of condo owners, but this ordinance does seem more than anything like a way for the city to squeeze even more money out of its residents. If this measure passes, I wonder, will it put a serious crimp in the short-term rental plans of Chicago condo owners?
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Beware of Foreclosure Scams
May 17th, 2010 categories: Economic Recovery, For Homeowners, Foreclosures, Housing Market
It’s easy to panic when you’re falling behind on your mortgage payments. No one wants to lose a home to foreclosure. It’s a frightening thought.
But don’t let your fears of foreclosure override your common sense: If an outside company calls you and promises that it can rescue you from foreclosure, hang up the phone. The odds are good it’s either a scammer or a company that will charge you a significant amount of money for something that you can do on your own for free.
The Web site of the Illinois Association of REALTORS® recently posted a story from the Better Business Bureau branch that serves Chicago and Northern Illinois warning homeowners of a growing number of foreclosure-related scam artists. Foreclosure information is accessible to the public. This has led to big business among companies claiming to offer foreclosure-prevention services.
The scam works like this: An individual or company contacts homeowners whose homes are facing foreclosure. They’ll promise to either negotiate a mortgage loan modification or stop the foreclosure. Of course, they’ll require a hefty fee for their service.
Some of these callers will take the money from desperate homeowners and then do absolutely nothing. Even those companies that do perform foreclosure-prevention services don’t actually do anything that homeowners can’t do on their own for free.
If you’re facing foreclosure, or even if you’re worried that you might fall behind on your mortgage payments, you should always call your mortgage lender directly. Don’t work with an outside company. Call your lender, explain your financial situation and ask for help.
Remember, mortgage lenders and banks don’t want your home to fall into foreclosure. They don’t want to try to sell your residence. That’s not their business. The odds are good that your lender will try to work something out to prevent you from losing your home.
If you work with an outside foreclosure-prevention company? You’ll just be throwing more money away.
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Wall Street Journal: Housing Prices Won’t Rise Anytime Soon
April 29th, 2010 categories: Chicago Info/News, Economic Recovery, For Buyers, For Homeowners, For Sellers
If you’re a home seller waiting for the median sales prices of condominiums and single-family homes to rise in Chicago and the rest of the nation, you might be waiting for a while, at least according to a Wall Street Journal study of the country’s residential real estate market.
The Journal’s most recent quarterly survey of housing-market conditions in 28 metropolitan areas found that inventories of homes for sale remain quite high in many big cities, including in Chicago. At the same time, the number of distressed buyers who face potential foreclosures also remains high in many cities.
This combination is a perfect recipe for keeping housing prices at their current affordable levels. When buyers have many homes from which to choose, they don’t have to overpay to land their dream home. When more homes fall into foreclosure, it tends to drag down the asking prices of other residences in the surrounding neighborhood. After all, it’s not easy to ask $300,000 for a condo when the neighbor’s place, in foreclosure, is selling for $220,000.
While this is bad news for sellers, it’s the opposite for buyers. They can still find high-quality homes in Chicago for prices that are more than fair.
The Wall Street Journal forecast specifically mentions Chicago, saying that our city is similar to places like Charlotte, N.C.; Jacksonville, Fla.; Nashville; and Philadelphia: The supply of homes already on the market is far higher than the national average.
Again, this is good news for buyers. It means that they have plenty of good homes to chose from in Chicago.
The local housing market is in a solid recovery. But the number of sales is increasing faster than is the median sales price of homes. This means that sellers have a choice to make: If they don’t have to sell, they might want to wait a year or more in the hope that housing prices will rise. If they do need to sell, they have to commit to working with their REALTORS® to find the right price for their home in this market.
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Even Warren Buffet Likes Chicago
April 14th, 2010 categories: Chicago Real Estate News, Economic Recovery, For Buyers, For Homeowners, For Sellers, Real Estate News
When making decisions on where to invest money, it always pays to look at what the wealthiest people do. After all, they’ve already made a fortune. You could do worse than follow their lead.
By this logic, people should be investing their money in Chicago real estate.
Bloomberg News reported that the property brokerage of Berkshire Hathaway Inc. – the company owned by investing guru Warren Buffett – in April bought a local Chicago real estate brokerage. This isn’t the first foray into Chicago housing for Buffett, either. Berkshire Hathaway purchased another Chicago brokerage last year.
The move makes sense for Buffett. Chicago housing sales have risen for six straight months, according to the latest sales data from the Illinois Association of REALTORS®. And top neighborhoods in the city, places like Lincoln Park, Lincoln Square, Ravenswood and Lakeview, have survived the housing slump in solid condition. These neighborhoods are still highly desired by buyers.
Yes, housing prices here have fallen since their peak in 2006. But the market is still strong in these top neighborhoods. Buffett obviously realizes the strength of Chicago’s housing market, and isn’t afraid to put his money on the line.
Buffett’s buy actually supports my contention that this is a great time to buy property in Chicago. Any good investor knows how important it is to buy low. In Chicago, housing prices have dropped since the start of the recession. Today, buyers can purchase more Chicago home for their dollars. For some buyers, this means the opportunity to buy into a top city neighborhood that might have been out of their financial reach just two or three years ago.
So if you’ve been considering buying a Chicago home, this is the time to make a move. Follow the example of Berkshire Hathaway and invest your money in Chicago residential real estate. After all, it makes sense to Warren Buffett, and he knows a thing or two about investing.
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Will Generation Y Lead Us Out Of Our Housing Doldrums?
April 12th, 2010 categories: Chicago Real Estate News, Economic Recovery, For Buyers, For Homeowners, For Sellers
Once in a while, I’ll stumble across a newspaper story that reminds me of the importance of in-depth, analytical reporting. I came across one of these April 2 in the Chicago Tribune, an analysis of the home-buying needs of Generation Y buyers by writer John Handley.
Handley’s story focused on the importance of this group of buyers. It quoted Chicago-area real estate experts who predicted that Gen Y buyers will lead Chicago and the nation out of their long housing slumps.
There are several reasons that the experts cited for this. First, there are simply a lot of Gen Y buyers. According to the Tribune story, there were 75 million people born between 1982 and 1995. These are the members of the Gen Y generation, and they are now in their 20s. They’re entering, or are already in, their home-buying years. Simply put, this means that there are more potential buyers now entering the market, which should lead to an increase in housing sales.
The story also mentions that Gen Y buyers purchase homes at earlier ages, and that they tend to spend more money on these first residences.
And once Gen Y buyers purchase their first homes, they become future buyers of larger, more expensive residences. Like other generations before them, they’ll buy first homes, live in them for a certain number of years and then upgrade. This should all equal a significant number of future home sales.
What impact have the Generation Y buyers had on the housing market today? Builders are creating homes designed to appeal to these younger buyers. This means smaller, more-efficient homes. It also means more home that are high-tech, homes that are wired for high-speed Internet connections.
If the Generation Y buyers behave as the housing-market experts predict, it will mean good things for the future of both the residential real estate industry in Chicago and across the nation.
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