Reaping The Results Of The Excesses
The Chicago Tribune reports from Illinois. “Chicago-area sales of existing homes took their worst plunge since at least 1998 in January, and the median price dropped for the first time in at least a decade, according to the Illinois Association of Realtors. January sales of single-family homes and condos in the Chicago area were off 34 percent from January 2007. ‘We can’t blame it all on the weather, but we all know what January was like,’ said association spokeswoman Ann Londrigan. ‘Compounding problems with consumer confidence and mortgage tightening, there’s not much good about January that you can say.’”
“Though Chicago real estate agents report that many sellers are cutting their prices, analysts see others clinging to outdated notions of pricing and remaining a roadblock to the recovery.”
“‘I do think there’s a stubbornness there, particularly in high-priced markets like Chicago,’ said Caroline Sallee, an economist for Anderson Economic Group. ‘People aren’t coming down on the price, so the home doesn’t sell and you continue to see inventory [of homes for sale] rise.’”
“Linda Rizzuto, for one, said she isn’t inclined to come down from the $444,900 she’s asking for the Northwest Side home where she has lived 17 years, though not one would-be buyer has looked at it since she listed it in January.”
“‘My friends think I’m crazy for putting the house up for sale now because the market is bad,’ she said. ‘If I had to sell, I would be panicking, but I don’t have to sell.’”
“Glen Ellyn real estate agent Karen Lippoldt said sellers ‘need to get more aggressive with pricing.’ Nonetheless, asking prices are coming down. ‘I had over $500,000 in price reductions for the year in 2007,’ she said.”
“She said that in her area, builders were skewing the price data with huge cuts just to get homes off their books. And homes do sell, she said. ‘I have three homes under contract,’ Lippoldt said. ‘None of [the sellers] got what they wanted, but was it a fair price? Yes.’”
“Hoping to avoid bankruptcy, home builder Kimball Hill Inc., said Wednesday that it will scale back on operations and reduce staff, including at its headquarters.”
“The Rolling Meadows-based builder will exit the Florida housing market. It also will lay off 132 employees at its headquarters and elsewhere around the country by December, the 39-year-old company announced.”
“Kimball’s fortunes have taken a radical turn since 2006 when it had more than $1 billion in sales. By the end of its fiscal year Sept. 30, it reported losses of $220.5 million on revenues of $894.7 million. It is holding 10,955 house lots that are in development or completed.”
“This year, ‘the marketplace is fickle, buyers are fearful and traffic has fallen off sharply’ during a frigid, snowy winter, said Kenneth Love, Kimball Hill’s CEO during an interview.”
“Property markets are reaping the results of the lax underwriting criteria that prevailed early in the decade and pumped up house sales to booming levels, he added. ‘We’re now seeing results of the excesses of 2003 through 2006,’ Love said.”
“At its Settlers Ridge subdivision in Sugar Grove, where it has sold about 100 units since May 2006, it still has approximately 800 unsold house lots, said Elizabeth Drozdik, director of market research for a Schaumburg-based real estate consulting firm.”
“The timing of the development was unfortunate. ‘Sugar Grove came on market when housing was already hurting, but the industry was in denial and no one understood how bad things would get,’ Drozdik said.”
The Beacon News from Illinois. “Allyn Burkett has shown her house five times in five months, and not a single offer. The Sugar Grove woman has concluded it’s not her but the market that is straining her finances and delaying her move back home to Texas.”
“And she should know. Burkett is a Realtor in Elburn who said she has tried ‘all the tricks of the trade,’ but ‘I just don’t know anymore.’”
“‘I thought I was going to get (an offer), but they decided my living room was not big enough,’ Burkett said. ‘It was one measly thing that broke the deal.’”
“Now that Burkett has stepped foot in her clients’ shoes, there’s some advice she has for sellers: ‘You just have to be patient.’ She also says, ‘If you don’t have to sell right now, don’t.’”
The Herald News from Illinois. “Over the last two years, Gladstone Builders has used a number of methods to stay afloat in a sinking housing market. When the company ran out of ways to reduce costs, it turned to village hall. In order to maintain its lower prices, Gladstone asked the village to consider slashing its fees if the company buys building permits in bulk.”
“‘I need the village’s help, quite frankly,’ said Adam Dontz, VP of Gladstone Builders and Developers.”
“Trustee Paul Fay said he was reluctant to support the plan and that the village’s first responsibility is to its taxpayers. Trustee Larry Vaupel noted that helping residential builders like Gladstone could send a message to commercial developers, who need residential rooftops to be successful.”
“‘I can hear naysayers and critics already, saying … we’re giving in to developers or letting developers off the hook,’ Vaupel said. ‘This isn’t government versus big business. I wonder how a half-built subdivision serves (taxpayers’) interests.’”
“Gladstone’s marketing campaigns gave the company a boost — an offer to reduce its single-family homes by $100,000 generated 20 sales in two days. Gladstone homes are priced at about $496,000 for single-family houses and more than $300,000 for townhomes.”
“Of the 33 building permits the village issued in January, 14 were for Gladstone homes. However, faced with a local residential lot supply that far exceeds demand, Dontz said Gladstone likely would not issue 14 permits in a single month again without the village’s help.”
The News Democrat from Illinois. “Home sales were down about 25 percent in January from the same month a year ago in St. Clair and Madison counties, according to local Realtors’ associations.”
“Lynn Turpin, of Belleville, has been attempting to sell his condo on Garrettsen Drive for the last four or five months. ‘We’ve had an awful lot of people interested,’ the 77-year-old said, although no deal has come through on the two-bedroom condo with hardwood floors and a Jacuzzi.”
“‘I don’t think I’ve got it overpriced,’ he said.”
“Belleville Realtor and National Association of Realtors director Stan Sieron said the recent subprime market woes and declining sales have forced Realtors to work harder and smarter. ‘The days of order-taking are out the window,’ he said.”
From Crain’s Detroit Business in Michigan. “For local banks, 2007 was interesting. It was also a financial mess. Driven by much higher provisions for loan losses and by bad-loan write-offs — the bulk of which bankers said were caused by the collapse of land development, housing sales, and commercial and real estate development — most banks lost money.”
“Most had worse years than in 2006. Many of them finished with fourth quarters that would have seemed disastrous a year ago.”
“‘A lot of the home builders in Michigan have wiped away years of earnings and many have filed bankruptcy. It’s hard to say it’s stabilized,’ said Terry McEvoy, an equity analyst for Oppenheimer & Co Inc. ‘If there’s a continuing decline in home values, those banks with exposure to the real estate market will continue to face losses.’”
“David Scharf, senior equity research analyst with Cleveland-based FTN Midwest, said one positive note is banks are rethinking how aggressively they’ve been moving assets off their balance sheets, in some cases by selling foreclosed properties at fire-sale prices, which just creates problems for other customers trying to move inventory.”
“‘In some cases, they’ve been taking a 50 percent haircut. Now, they’re going to take a more thoughtful approach,’ he said.”
The County Press from Michigan. “With foreclosures of homes in Lapeer County soaring to new heights, the federal government is offering a beacon of hope to deter the onset of blight in neighborhoods devastated by the housing crisis.”
“The U.S. Department of Housing and Urban Development is offering local governments the chance to buy unsold repossessed HUD-owned homes for $1.”
“‘They’re vacant homes the Federal Housing Administration is unable to sell after six months,’ said Lapeer County Community Development Director Mike Partlo. ‘There is a 10-day window where local governments may purchase the single family homes for $1.’”
The Grand Rapids Press from Michigan. “A home in foreclosure, plastered with postings, warning signs and notices, is a symbol of loss for the previous owner. But for those participating in West Michigan’s first foreclosure tour Saturday, the bank-owned properties represented potential, at a deep discount.”
“‘This is what I do,’ said William Bryant, who owns four rental properties already. ‘I’m a businessman. I want to know how to get the best for my money; that’s why we’re shopping for foreclosures.’”
“Realtor James Goetzka started the tour by telling the group that the current housing market, although unfortunate for those losing their homes, is providing an opportunity. ‘It won’t last long,’ he said. ‘It will be a little window in history.’”
The Journal Sentinel from Wisconsin. “Twenty-one Wisconsin banks didn’t turn a profit last year, as the housing slump lingered and a slowdown in the economy deepened, a new report by regulators shows.”
“Banking consultant David L. Donihue said the housing market remains weak and that the slowdown appears to be spreading to commercial construction in addition to residential developments.”
“‘I think it’s going to take the rest of this year for things to turn around,’ Donihue said. ‘I think people are just kind of pulling back on what they had been buying and waiting to see what’s going to happen.’”
“Daryll Lund, CEO of the Community Bankers of Wisconsin, said the housing and economic slowdown have caused bankers to ‘hunker down’ for the time being and bolster lending standards.”
“‘Segments like the condo market have really kind of hit the wall a little bit,’ he said. ‘Some of those development projects that probably a few years ago were given the green light a lot more quickly are now demanding higher amounts of units be sold before the financing can be put in place.’”
The Sun Times. “While numerous suburban home builders are struggling, Chicago-based Terrapin Properties LLC is emerging as the first major condo developer here to see operations spin out of control in the current housing slowdown. A foreclosure suit filed against Terrapin over a project in Kenosha, Wis., indicates the company could be dissolved.”
“Indymac Bank, the primary lender on the 162-unit condo development in Kenosha, last month sued Terrapin for more than $13 million in back debts.”
“But the case isn’t a garden-variety foreclosure in which a lender has no recourse beyond getting the keys to the property. Terrapin’s principals, including James Geleerd and Michael Ezgur, personally guaranteed the loan, according to the suit. Indymac is going after them, as well as principals Sherwin Braun and Greg Braun, to collect.”
“As a result, the control of other Terrapin projects could be in play. Terrapin also controls units left over from previous projects. The company’s Web site said it also has projects in Arizona and Florida, plus commercial space in Chicago buildings.”
“Sources said Geleerd begged for time Friday on a conference call with a large number of creditors. They said Geleerd asserted he was close to selling the Burnham Pointe condo inventory to somebody whose cash would prop up the company.”
“‘The atmosphere was pretty intense,’ one person said. ‘And nobody believes that in this market, there’s an investor looking for condos.’”
The Pioneer Press from Minnesota. “The CEO of Franklin Bank in Minneapolis has watched during the past year as foreclosures in North Minneapolis have multiplied to the point where just about every block in the neighborhood has at least one vacant home.”
“‘I think there is opportunity in the midst of this chaos for community banks to be back at the table and be one of the main lenders in the mortgage industry again,’ Dorothy Bridges said.”
“For Bridges, North Minneapolis is more than a place to do business. She owns a home there, and…she also encouraged her son to buy a home there. Six years ago, Myron Bridges paid $130,000 for a new two-story beige and white house on Dupont Avenue.”
“Until recently, Myron Bridges’ home looked like a smart investment. In November, it was appraised at $171,000. But then a string of foreclosed homes on Dupont Avenue and in the surrounding area pulled the property value down. Last month, his mortgage company said the home was worth $105,000. He didn’t have enough equity in the home to refinance again.”
“To make things worse, his mortgage payment recently jumped $200 to $1,310 a month, when the adjustable-rate mortgage he got when he refinanced three years ago reset. ‘I can’t sustain that rate for a whole year,’ he said. ‘We’re stretching.’”
“As much as Bridges wants to help, there are limits to what the bank can do. She’s running a bank, not a charitable organization.”
“‘The risk and the reward is something we’re in the process of investigating,’ she said. ‘If it doesn’t have a mutual benefit (to Franklin and the community) then it doesn’t make sense for us to do. We still have to generate some level of profit.’”
The Minnesota Daily. “In the last year, the explosion of residential property values of the early 21st century slowed, partly because of repercussions of the sub-prime mortgage crisis. Though it wasn’t good news for Wall Street, the resulting higher vacancies and lowered property values could be a boon for renters in the Twin Cities, especially students.”
“V.V. Chari, an economics professor, said the foreclosures that came out of the sub-prime mortgage crisis have put downward pressure on housing costs. ‘Difficulties in the sub-prime mortgage debacle and the slowing of the economy in general, reduced land prices quite substantially,’ Chari said. ‘It has tended to reduce housing cost.’”
“While student neighborhoods have largely escaped the foreclosures that plague other parts of the Twin Cities, renters, who make up more than 90 percent of residents in the University neighborhood, still benefit from this spillover. Although students live in a region of Minneapolis with a low vacancy rate - about half that of the city as a whole - rent in the University area, at $818, is still below the city average of $868, according to the 2007 Minneapolis Trends Report.”
“The condominium boom of the early 21st century, which introduced thousands of units into the city, has also helped stabilize rent prices.”
“Cecilia Bolognesi, principal planner for Community and Economic Development, said a factor affecting rent could be the many condos transformed into rental units in recent months, in a sense, flooding the market.”
“In October 2007, three large condo projects in Minneapolis announced they were being foreclosed by lenders. Together, the three projects had a cumulative 553 units.”
“Bolognesi said another factor is that many developers in Minneapolis have turned to building rental units instead of condos or single family homes.”
“Senior Kait Sergenian said she currently lives in the Phillips neighborhood of Minneapolis. ‘It’s slightly easier every year,’ Sergenian said. ‘I had less people with me, and also we were looking outside campus, so the quality of houses was slightly better.’”
“Junior Skyler Nowinski said he pays roughly $400 a month to sublease a room in a house with three other roommates. ‘Personally, things have become cheaper for me,’ he said.”
“The median price dropped for the first time in at least a decade. …There’s not much good about January that you can say.”
On the contrary, the good thing you can say is that the median price dropped!
January sales of single-family homes and condos in the Chicago area were off 34 percent from January 2007. ‘We can’t blame it all on the weather, but we all know what January was like,’ said association spokeswoman Ann Londrigan.
It’s true, January 2008 will go down in history as the very first January where it was cold in Chicago.
Snowy, too. i wonder what the excuse will be for feb.
Wind, maybe??
A friendly FYI - Chicago is dubbed the Windy City not due to wind speeds but the boisterousness of the local population.
Not enough sunny days in February. Chicago is a green city - all of our real estate contracts are solar powered.
“Lynn Turpin, of Belleville, has been attempting to sell his condo on Garrettsen Drive for the last four or five months. ‘We’ve had an awful lot of people interested,’ the 77-year-old said, although no deal has come through on the two-bedroom condo with hardwood floors and a Jacuzzi.
“‘I don’t think I’ve got it overpriced,’ he said.”
After five months, perhaps he needs to adjust his opinion. If so many people have been interested, how come nobody’s signed a deal?
After five months, perhaps he needs to adjust his opinion.
If he does not change his opinion, the market will do it for him.
Why does a 77 y.o. have a Jacuzzi?
Jacuzzis can be therapeutic for back problems, muscle aches and such.
Or maybe he just likes to get down in the swirly water.
Come on edgewater john, don’t you think you’ll be “active” when you’re pushing 80?
Why does a 77yo think she’s has enough quality time left in life to quibble over price when she should prefer to get on with living.
Ok, phillygal, it’s a date - see ya in 41 years!
ej-
My assisted living facility or yours?
Philly Gal. That`s funny !!
With the help of the public records, I have located Mr. Turpin’s luxury pad in hip Belleville. Overpriced at $224,900? You make the call!
http://tinyurl.com/3ds3pv
I can’t tell what he paid, but the assessor’s office declares that fair market value is $164,682.
What a dump! Maybe if he threw all the furnishings out, including the window treatments, and did the kitchen cabinets etc. over in white, it might not look so much like an OLD FOLKS’ HOME. All that’s missing are some doilies (and they’re probably there: I didn’t look closely at the photos). Do you think he uses mothballs to preserve his treasures?
As for old people and hot tubs, I saw a geezer (at least 80) in the drug store bying condoms, so dignity (not to mention reason, and accurate self-image) and old age are necessarily a package deal.
bying = buying
Four baths? He must really be full of __it!
Down at our rendez-vous, Three’s company, too!
The late 70s/early 80s lives on at that pad, for the low low prices of $225k!
global warming.
More snow!
Hell froze over?
I’m curious to see how much of an inventory explosion Chicagoland sees in March or April, as overwinter fencesitters jump back into the market. (And more new condos come online.)
I’m looking for a new rental right now, and it’s kind of a pain to weed through all of the POS condos and new luxe construction that’s popping up in Craigslist and Reader ads.
I watch the Kane County over 2 acre market carefully. There are a lot of properties “delisted” in Dec (but still with for sale signs out front) waiting to be “relisted”.
Inventory will be insane I figure round about mid-March when those who can’t wait another second for April to come get busy.
Lots of “for sale” signs sprouting where they usually don’t on the Northwest Side. I kid you not, there’s even one staring at me right outside my window as I type. If these blocks get one sign per block per spring it’s a big deal - but this year it’s more like two and three per block.
EJ and Brian, I can’t tell you how many recently converted buildings are just sitting here in West Ridge. One building, on the corner of Morse and Oakley has been sitting there since last winter and ALL of the units are empty. At Morse and Western, another building went up. Not one unit sold. Heck, there’s not even a sign out front!
I could go on and on, but I’m sure see it in your neighborhoods as well. East Rogers Park is really bad. Of course, over there, you had a bunch of dingleberries buying $ 250K condos in the Juneway Jungle, only to discover that at night, it’s like the Wild West!
People can be oh-so-stupid.
Ugh, Juneway Terrace! I used to work at the Howard (’el)Car Shop about ten years ago - I drove a hailed damaged Geo Metro with no radio and they still broke into it!
That Morse ‘el stop can be rough too. I steer clear on hot summer nights, but at least two former coworkers took their chances on conversions there.
My travels take me near West Ridge everyday. Lots of “for sale” signs between Western and the river along both Peterson and Devon lately.
“‘My friends think I’m crazy for putting the house up for sale now because the market is bad,’ she said. ‘If I had to sell, I would be panicking, but I don’t have to sell.’”
Why has she listed th ehouse for sell if she does not have to sell. She is in denial that the prices are coming down.
Sooner or later she’ll find out that we don’t have to buy either.
My wife and I are going to put our house on the market this spring. We don’t have to sell, but for the right price we will. My wife wants a bigger house, I’m content where we are but I’ve had enough harassment about our “small” house. I’m willing to give it a try, and if we can find a decent rental we’ll camp out there for a while.
The market is not “bad” yet. Prices are still not far from all time highs, and there is some turnover. A bad market would be were prices are way down and there’s hardly any turnover at all. So, it’s still a good time to sell, but it’s not like you have to.
Remember, in the great middle ground house prices are still low enough that many folks can easily handle substantial declines. We have nearly as much $$ in the bank as we have home equity, and we’re at about 50% equity in our house. Our 15 year loan payments are comparable to renting a smaller house. There’s no real compelling reason do do anything here unless we get sick, divorced or fired. The “bubble” has a lot of HELOCED and overmortgaged folks choking out h ere, but regular folks sill have a lot of breathing room. I’m so glad we’re not on a coast.
Dump the b*tch! Seriously.
Life’s too short to be harassed about a “small house”.
IMNSHO, life is about having fun (whatever that means to you.)
life is about having fun (whatever that means to you.)
Absolutely, firmly, completely agree with you there, faster. It’s a sorry thing that so many of us poor little easily-swayed bald monkeys get caught up in getting more, and bigger, and newer stuff, and for why? Well, hmmmm, oddly enough, for most of us so we can feel happy and think we’re having fun. Sometimes I really suspect that the whole opposable thumbs thing was a bad idea.
‘Sometimes I really suspect that the whole opposable thumbs thing was a bad idea.’
I mean, a bad idea for everybody else. I personally use my opposable thumbs quite wisely; prying open bananas and fireworks wrappers and playing with matches and feathers and accordions. Things like that.
I’ll keep my wife. We can easily afford a larger house. Our current house is less than 2x income. I’d like to stick to under 2.5x, the wife would like to stretch it to 3x. Even at 3x income we could swing a 40% downpayment and still have money in the bank. Payments on a 30 year loan would be less than rent, and with CDs yielding 3% what’s the use in having savings?
As I said there is no compelling course of action here. Renting stinks, and so does buying. Saving money is a losing proposition too.
Right, that’s why sometimes in life the best proposition is the least worst one. However, that may be a complicated thought for some.
Your household income must be north of $100,000 annually, which is about double the household income in Chicago. Not that there’s anything wrong with that, but you are atypical in generation of income.
Also, the bungalow belt of Northwest Chicago has seen continual price declines for the past 6-8 months. Everything a mile or two on either side of Elston is suffering, from Clybourne Ave. all the way up to Jefferson Park.
If those in Belmont-Cragin, Portgage Park, Irving Park, Gladstone and Jefferson Park think they are going to get $325K for their 100-year-old bungalows, they need to re-think things. Maybe those who own a stain glass-paned octagon will get $325K, but those houses are considerably larger and more beautiful than the typical bungalow of which there are several tens of thousands.
To add to comments made by others here: my grandmother sold her bungalow in Portage Park (Central and Lawrence vicinity) in 1987 for $71,000. No way is it worth $325K today.
Bungalows in Old Irving that haven’t been updated 30 years are on the market for $429,000 (3708 N Kedvale); Larger, updated bungalows are on the market in the 600’s (3716 N Kedvale when it was listed, currently delisted, unsold).
The areas surrounding Old Irving have tons of bungalows. Two years ago they were listed in the 400’s, even though the neighborhoods are nowhere near as nice as old irving; lately I’ve been seeing them listed in the 300’s, which is a major step forward. I’ve done some research on some of them (using the infamous ccrd.info) and the common theme is over-HELOC’d, now must sell or be foreclosed. These homes were priced in 100’s in the late 90’s. I know the northwest side is getting kinda hip for some of the yups like me who don’t want to live in Lincoln Park but want to stay in the City, but no way in hell am I paying $400k for a house that sold in the 100’s just a few short years ago. Rant off.
Good info. and commentary; thanks for the data, too.
That whole corner of Chicago is a wonderful one - I know it well. I like bungalows but there’s way in hell I’d pay $400K for one. In fact, I wouldn’t pay $250K. There are too many other nice properties in other areas of the country that cost less than $175-$200K and in locations that are less confiscatory.
BTW, your rant doesn’t come off as such. Instead, you sound like someone with common sense.
“Junior Skyler Nowinski said he pays roughly $400 a month to sublease a room in a house with three other roommates. ‘Personally, things have become cheaper for me,’ he said.”
just think of the heloced parent of a fellow student who bought an overpriced condo for thier kid and figured they would sell after graduation. should have sprung for the $400 a month share
The “sell after graduation” meme is going to take a real beating in the coming years.
Funny that you mention this — I was looking through my alumni magazine last night and saw a number of RE ads that used the “buy instead of rent for the kids” angle.
My thought was, “Jeez, that line still works? In 2008?”
Well, how expensive is it to rent a few ads in an alumni magazine? Might even have good ROI if you can find just a few more
investorssuckers.Think like a sheeple, people, think like a sheeple.
There’s a condo complex near the University of Arizona that’s used the “buy a condo, then make money off of roommates” angle. It seems to have worked.
However, if I were a student, I could think of a lot better things to do than being stuck with a condo for which I would have to be a property manager.
“Linda Rizzuto, for one, said she isn’t inclined to come down from the $444,900 she’s asking for the Northwest Side home where she has lived 17 years, though not one would-be buyer has looked at it since she listed it in January… ‘If I had to sell, I would be panicking, but I don’t have to sell.’”
Too bad the used house salesperson can’t put “Seller says she doesn’t have to sell” in the MLS description. That way they wouldn’t be wasting any buyers time.
So Linda bought in 1991, IMO she is part of the problem. The Northwest Side was where I was born and raised - in the house my grandfather built in 1951.
In 1991 it would have been a huge deal for a SFH in a typical Northwest Side neighborhood - like my Portage Park - to fetch the high $100s. She probably rode this house from there to almost $450 - quite a haul for seventeen years.
The prices seem to be dropping in the Bungalow Belt, but there’s plenty of room to go. Linda Rizzuto can hold her breath and pout all she wants, there’ll be plenty of other opportunities.
Whoa, you should see the property records on this one!
Cook County has a deed in 1992 for $134,000 and a mortgage for $100,000. Put it into a trust in 1996, got it back in her name in 1999 - to refinance it into a new mortgage for $105,000 and put it back into a trust. In 2003, she takes it back out of the trust, refinances for $88,700 - and puts it back into her trust. In 2004, she takes it out of the trust and gets a $60,000 2nd mortgage - and puts it back into her trust.
She almost certainly has a lot of equity in the current market - unless those loans were neg-am, she can’t owe more than $149,000. But does she have to sell? Maybe those monthly payments are too high for her income?
What’s the advantage of putting it into a trust (multiple times), if there is one?
I’m not sure why she kept putting it into a trust, but I know there are some benefits if you put your house into a revocable trust for estate purposes. I believe this is a way you can circumvent your heirs from paying a 10% inheritance tax on the real property. In other words, if you put your home into a revocable living trust naming your kids as the beneficiaries, then, they will not be penalized.
I would imagine that, in order for her to refinance, she would have to remove the home from the trust in order to accomplish the transaction.
Any estate attorneys out there who can comment?
I don’t think a revocable trust changes Federal estate taxes; you must give up control of the money. i.e. irrevocable trust. Downside is, it aint yours anymore!
“I don’t think a revocable trust changes Federal estate taxes; you must give up control of the money. i.e. irrevocable trust. Downside is, it aint yours anymore! ”
The grandmother of a friend died in the mid 1990’s. 8 of the 10 homes Grandma owned were sold to pay the taxes. Granted these were fairly valuable homes (tiny shacks in Coronado) but still……
It’s to avoid probate. My father did it in Cali and I’m told it made things a lot easier.
If the woman keeps getting a title in her name every time it’s take out of the trust, I have to assume that she’s the beneficiary. So I have no idea what sort of advantages she can get out of this. Clearly the “privacy” advantage has gone away by now. Anyone that does a title search can plainly see who owns it.
Linda tried to sell back in 2006 for slightly more than she’s listing it this time. If she couldn’t sell it in the “peak” period, why does she think it will sell now?
It’s preposterous.
Also, if you look at the pictures of the house, it needs a decent amount of updating inside. It has some nice vintage features but it’s not exactly the most modern kitchen I’ve ever seen.
Some people just like to dream.
The NW side is getting sort of ‘hip’ for people who refuse to move to the ‘burbs and want to stay in the city. It used to be somewhat affordable, and it’s still cheaper than a house in Lakeview, but nowhere near as affordable as it used to be. I know a handful of people who moved to the NW side from other areas in the City. I mean really, why the hell would I want to move to the ‘burbs (other than to escape Daley)? I’ve been here for almost 13 years and I love the city; even when I have children I’ll just send them to the private Catholic school down the block. I grew up the burbs and I’d have a hard time going back. I’ve known a number of people my age who moved to the city after high school/college, and about 1/4 returned to the burbs but the other 3/4 have stayed and refuse to leave. Kinda like me.
What’s the difference between the NW side and, say, Oak Park? You probably even get more house for the money now in Oak Park (I can’t believe I’m saying that.)
You can also still walk to restaurants, shops, the El and be downtown much quicker (in about 15 minutes on Metra or the El.)
And the schools are much better.
‘None of [the sellers] got what they wanted, but was it a FAIR price? Yes.’”
“You keep using that word. I do not think it means what you think it means.” Inigo Montoya, Princess Bride
is this from 2006 ?
cause that’s when it happened
“the median price dropped for the first time in at least a decade, according to the Illinois Association of Realtors.
“Belleville Realtor and National Association of Realtors director Stan Sieron said the recent subprime market woes and declining sales have forced Realtors to work harder and smarter.’
Yes, well, good luck with that plan, particularly the ’smarter’ part. I’m eating a bag of Twizzlers at this moment– breakfast of champions, as we know–and when I take a good look at any one of these twisting strings of delicious licorice goodness I perceive that they are all, every one of them, likely smarter and less twisted than the realtors I come in contact with.
Realtors? Working harder? Isn’t that an oxymoron?
Paying folk have trouble getting, er, stimulated when they are depressed.
“‘I can hear naysayers and critics already, saying … we’re giving in to developers or letting developers off the hook,’ Vaupel said. ‘This isn’t government versus big business. I wonder how a half-built subdivision serves (taxpayers’) interests.’”
http://www.despair.com/mis24×30prin.html
Deals are getting better. I don’t think the “low Cook county taxes” are a major selling point, though.
http://chicago.craigslist.org/sox/rfs/588171619.html
Laugh.
No, the taxes are only a selling point if you’re relocating from Long Island.
Yeah - Chicago property taxes are a tad extreme, aren’t they? The guy who used to fix my cars sold the business he owned after annual taxes went from $18,000 annually to $42,000 annually over the course of 12 months.
Way to go, Chicago. Kill your own tax base as you green the city and talk about the *benefits* of going green ad nauseum.
Steger! Whatever.
My boss just told me this morning that his older 3/2 SFH in Cook County is closing in on $10k a year for taxes. Urkel is threatening to shut down the county if he doesn’t get his sales tax increase. Yeah, whatta county - increase sales taxes into a consumer led recession. More property tax hikes are unstoppable at this point.
Stroger is out of options, and yeah, Steger isn’t that far from the Heights.
Taxes on cigarettes in Cook County are so high I feel a little badly for smokers. Cigs are still legal, after all. It’s definitely a Death By A Thousand Cuts tax-and-fees kinda county.
But gawd, it’s nice to sit in my favorite newly smoke-free bars.
Yeah, but it will be a drag eating at outside eateries now that dogs can join in on the fun.
I can’t wait until someone sues a dog owner for allowing their dog to pee on his or her plateful of food. Minus the foie gras, of course, which is not allowed on any plate. Dog slobber and shit in the vicinity of food made for human consumption is A-Ok - as is barking and humping - but goose liver is an infringement of animal rights.
All this as the population of Chicago continues to drop…
IL has the Mother-Of-All-Pension crises coming down the pipeline. Much as I like Chicago, I would not want to live there given this sword hanging over them.
I wouldn’t want to be a newbie at the city or county level, i see major wage and pension cuts coming. The many aren’t going to dig deep for the few.
They might have no choice in the matter.
my county could cut 30% and no one we notice
we have a navy and a dept of womens affairs
fairfax county va
They laid off lawyers at 26th and California last year, and I heard they’re asking for another 10% of the lawyers again this year. Might be scuttlebutt, still - the vise isn’t getting looser.
They laid off lawyers at 26th and California last year, and I heard they’re asking for another 10% of the lawyers again this year
They could lay off 100% of the lawyers down at 26th and California (that’s the Cook County Criminal Court for those not from Chicago) and the quality of legal representation wouldn’t change a bit. There’s a reason no cameras or recording devices are allowed, if you can’t afford a proper defense lawyer due process doesn’t exist. The judge will tell the court reporter to go off the record and then launch into a tirade, telling the defendant that everyone knows he did it and then threaten to destroy his life if he doesn’t do what the judge tells him to do. The public defenders act like they’re deaf when this happens. I’m really surprised that they still allow the general public to go watch, but I imagine that they keep the courthouse in the ghetto on purpose - scares most folks away.
Well, 99.9% of them really are guilty. And besides, any who really are innocent get plenty of defense attorneys offering to represent them, with or without a fee. Chicago police are so sloppy its not hard for competent attorneys to get evidence thrown out. But yes, the public defenders are pretty much worthless.
Illinois is a pending explosion. The whole state is a fiscal disaster. Dead last of all states in pension fungibility overall. Sales tax in Chicago now is 10.25%…highest in the country. Gasoline prices among the highest nationwide. Property taxes up by 25-50% YOY in numerous part sof the city. Monthly electric bills have doubled for about 1/2 the locals. Funding of public transportation a serious, ongoing issue.
State politicians just announced yesterday a proposal to increase income taxes from 3% to 5%. Way to go.
Yet state bureaucrats and media continue to endlessly push Going Green! and want to pass a socialist state health care program.
I’m glad I don’t own property here…it is time to leave.
When did all this happen? I was last there in mid-2007.
OK, those Chicago prices are going to get a whole lot cheaper. Exodus!
Nah, it’s still at 9% in Chicago. A bargain
And so it is…I was wrong.
I thought that Stroger & Co. rammed that sales bump through a month or so ago, but news tonight of the pending government shutdown must mean it didn’t happen.
Good news for a change! Hopefully the shutdown, if it happens, will continue on for months. We need to reduce the state deficit.
Sadly, it’s not much better in the collar counties either. A friend of mine and his wife own a $315K place in Mount Prospect. Their annual sales tax hit is $7050 annually. Nearly $600 a month for property taxes alone!
I imagine their monthly outflow for housing - not counting mortgage payments, of course - is nearing $1000/mo.
Conversely, I pay rent of $725/mo. for a 2 bed 2 bath apt in Ravenswood. Heat, water and trash pickup included as part of the rent. I most definitely have the better deal.
Mount Prospect is Cook County (same as the city of Chicago), so I am not surprised tax rates are probably about the same. We were told to budget 2 - 2.5% of sales price for annual property taxes. We decided to rent.
Ravenswood? $725?
So I am correct in thinking Chicago rents haven’t increased that much!
Hmmmm… I don’t think many people who haven’t lived in Chicago realize that $250K is a HUGE deal out there.
Thanks for the data point!
You’re welcome.
Rents in Chicago vary widely as you know. It’s easy to blow $2000/mo. for average rental domiciles in Lincoln Park and other trendy areas. I’d rather live 4 miles from the trendy areas and save $1,200 month.
As I told another poster here a few months back who was new to Chicago - the best rental finds here are found simply by driving the neighborhoods you want to live in and calling the phone numbers listed on the buildings themselves. Play the landlords off one another. Have your credit scores/rental histories in hand and tell the landlords you will commit THAT day. Making 10-15 phone calls will shave a considerable amount from rents paid.
Just for the record, kiddo, you could get roughly what you have in Ravenswood for $550 in 1995. Rents have barely budged if that.
I know my Chicago!
I rented in Roger’s Park in the late 90’s for about 5 years. Rent was 800 bucks a month for a two bedroom. Large apartments though. We were probably getting ripped off b/c we were considered ‘rich’ college kids. Fast forward to today - I still have a large apartment on the NW side; About the same distance from downtown as roger’s park is - I pay $850 per month. Nothings changed in 10 years.
I rented a one bedroom in Roscoe Village for about 18 months in 2003-2004. It was a crappier apartment and small but it was 700 a month. But it had a HUGE wooden deck probably 20×20. I moved in 2004 when I learned that the buildings on either side of my were being torn down and replaced with 3 flats. Or stacked brick double-wides; whatever you want to call them. So I moved. I pity the fool who paid $550,000 for the ‘penthouse’ unit of a three-flat on Damen Ave at Addison. The greater fool theory worked very well for developers. Three flats are as ubiquitous as bungalows. No way in hell that ‘penthouse’ unit will be worth $550,000 five years into this bust.
So tell us about silver…
When I wrote in this blog recently that silver was largely misunderstood by Americans, because there was much less silver than gold, above ground, many offered the view that I was wrong, wrong, wrong.
Well, I’ve done my homework. Maybe, you should do yours.
Why don’t the skeptics tell us exactly how many ounces of silver are produced, consumed, in storage; the basics.
I’m up over 60% in 6 months on my silver speculation/hedging/investment/ gamble/mistake what do the “skeptics” offer as results of their critical and superior thinking???
They are so much brighter than you, much poorer but obviously much brighter too
Hi frankie,
You are right; I’ll just shut my mouth and let them talk
I don’t recall a lot of silver price skepticism (I don’t read everything every day) but since you’ve had such a streak of good fortune, and assure us that you did your homework, why not share your findings instead of gloating?
I’m long a bit of silver because of the business I’m in, and it’s nice to have value of inventory go up instead of down over time. My observations would be that, on the supply side, most silver production takes place in conjunction with or as a bi-product of the production of other metals. Because of this, accounting cost of production can approach zero. When demand is low, as it was throughout the late 80s and 90s, mainly due to the ending of film processing demand (which accounted for over 1/3 of total demand), silver actually ceased being considered a precious metal.
This period of silver being shunned as a precious metal also coincided (with a lag) in the universal disuse of silver in coinage. The traditional gold to silver ratio in U.S. coinage was 16 to 1. As such, silver would currenctly be 67% undervalued compared to gold (or gold is 200% overvalued relative to silver).
Despite the huge moves, neither silver nor gold looks overpriced relative to other assets, on a long-term historical basis and especially in relation to the current environment, and silver would appear to be cheaper than gold.
Just a guess, but it seems to me that at least some skepticism of the silver market may be caused by people’s memories of past manipulations. I know people who are still holding on to silver they bought at the top of the last peak.
UK house prices slowing down
http://news.bbc.co.uk/1/hi/business/7269025.stm
“‘This is what I do,’ said William Bryant, who owns four rental properties already. ‘I’m a businessman. I want to know how to get the best for my money; that’s why we’re shopping for foreclosures.’”
I didn’t know the ability to purchase foreclosures suddenly made you a “businessman” or why you’d need a foreclosure bus to help you if you were in fact a “Businessman”. This guy sounds like a dim bulb.
RE: “The U.S. Department of Housing and Urban Development is offering local governments the chance to buy unsold repossessed HUD-owned homes for $1.”
The future of the homes the sub-prime paper bag holders want to pawn off on the US taxpayer.
Family member puts condo on sale in Lincoln park about 3 weeks ago. Went for about 50K markup from when it was bought in 2004. I’m thinking disaster…ended up selling a few days ago to a renter that put 20% down for about 30K higher than 2004. I’m shocked, but obviously happy for the relative.
That being said, Sugar Grove? Put a sock in that place. I think it’s a suburb of Des Moines. And I got a ticket once on the feeder ramp from i-88. 64 in a 55 mph zone. Jerks.
A renter, buying at this late stage of the game? Someone isn’t reading the HBB!
What size condo? Near what major intersection?
1800 sq feet near diversey and halsted
My friend caught a knife in that neighborhood too. His place is pure shite to channel the Brits. I wouldn’t rent that let alone buy. But he’s tenured so he might even be OK.
There is a building at the corner of Damen, Lincoln and Irving; I think it was built in ‘02 or something, in the middle of the boom. Last year there were a lot of units for sale in the building and none were selling….so I got to work doing some research courtesy of ccrd.info….and discovered that these FBs were FBs before the term FB was even coined. They bought these units new in ‘01 or ‘02 but paid ‘06 and ‘07 prices! In ‘07 the units were listed for prices just barely above what they paid for them. It’s like they borrowed all the appreciation they would have gained during their five years of tenancy and gave it to the developer in ‘01 at the closing. What morons. Did they really believe that real estate only goes up? I love it when I see 1 bedrooms in crappy neighborhoods asking in the 200’s. Where the heck did you think the price was going to go from there? ?? They paid WAY too much of a premium to the developer for a ‘converted’ unit.
The new construction in chicago is wretched. i don’t know what people are thinking when they buy it.
My favorite new construction problem is bad bricks that almost immediately show effluorescene and mineral deposits building up from water penetration. I think they’ll have to re-clad some of these cheaply constructed newer buildings.
Did anyone else see the new (in 2005/6 or so) 8-unit condo on the east side of Southport just north of Wellington that was torn down, and another one put in its place? i guess the first one was such a mess it wasn’t worth saving.
Think of how many of these new buildings are borderline tear-downs, that will be plagued by nothing but problems over the next decades stemming from cheap construction.
I wonder how many of these pinheads have come to resent all their granite and stainless steel. Such ostentation must remind them every day of their bumpy rides down the fast lane to bankruptcy court and retirement at age 80.
How bittersweet.
“Burkett is a Realtor in Elburn who said she has tried ‘all the tricks of the trade,’”
One last “trick” to try…reduce your asking price. Heck, that might do it.
yea, but then she would be “giving it away!”
Ron Paul on what he would do if he was Ben Bernanke.
http://cosmos.bcst.yahoo.com/up/finance?ch=1316259&cl=6693920&lang=
Good interview. Interesting to see Fox News giving him a fairly complimentary interview and acknowledging him as a Presidential Candidate after they wouldn’t even include him in their debates.
“‘My friends think I’m crazy for putting the house up for sale now because the market is bad,’ she said. ‘If I had to sell, I would be panicking, but I don’t have to sell.’”
I’d have to agree with her friends.
Actually, if you are trying to get out of a house, now would be the time to do it. Why wait until you can get even less?
not even funny
” Federal Reserve Chairman Ben Bernanke told Congress Thursday that the nation isn’t “anywhere near” the dangerous stagflation situation of the 1970s.
“‘They’re vacant homes the Federal Housing Administration is unable to sell after six months,’ said Lapeer County Community Development Director Mike Partlo. ‘There is a 10-day window where local governments may purchase the single family homes for $1.’”
Can private individuals bid?
Almost 10 years later, the Settlers Ridge subdivision in Sugar Grove IL has only 110 of a proposed 950 homes and their infrastructure is in shambles.
http://www.chicagotribune.com/suburbs/aurora-beacon-news/opinion/ct-abn-crosby-settlers-ridge-st-0106-20160106-column.html