Chicago Real Estate Market
Chicago real estate professionals are hoping that Mayor Rahm Emanuel, who is scheduled to take office on Monday, May 16, following Richard M. Daley’s 22-year reign, will move quickly to reinvigorate the Chicago real estate market in whatever ways he can.
Emanuel has already ruled out raising property taxes to address the city’s major budget problems, which is good news for cash-strapped homeowners and anyone planning to buy a condo or other house.
Emanuel has also ruled out raising property taxes to address the city’s major budget problems, which is good news for cash-strapped homeowners and may encouraged wary homebuyers.
Emanuel noted during the campaign that local “real estate values have lost 30-40 percent during the recession–much more in low to moderate income communities.”
According to city estimates, there are approximately 19,000 vacant buildings and 10,000 to 15,000 vacant lots in Chicago. The crisis is evident looking at the high number of boarded- up homes in many neighborhoods. Emanuel has asserted that in neighborhoods hardest hit by the recession, there are severe barriers to private investment, and said city leadership and action are essential. He promised to “make sure Chicago utilizes every tool possible—like land donations, demolition liens, and non-cash bids on delinquent taxes—to make sure investments are targeted and comprehensive, to give communities the greatest chance to redevelop and succeed.” He wants to develop and implement plans for re-use of all buildings and vacant lots in targeted areas. This includes rehab and new construction, adjacent land donations, parking improvements, community gardens and urban agriculture.
During the campaign, he stressed the importance of a diverse housing market in helping Chicago remain a world-class city, and hopefully the Chicago real estate market will rebound and the sale of condos and other homes will rebound again.
In an interview with the website Hispanically Speaking News, Emanuel also pledged his support for rules mandating that new housing developments in Chicago set aside a portion of their units as affordable, to make home ownership possible for more people. In a further effort to strengthen the Chicago real estate market, he also plans to expand the Neighborhood Stabilization Program, allowing the city to acquire and fix up more vacant and foreclosed homes.
iPad in Real Estate
Technology and real estate go hand in hand when it comes to efficiency in your job. There are so many things that agents can use that will not only make them cutting edge but they will perform faster with the convenience of the iPad. For real estate agents interested in getting an iPad to conduct business, it is important to know which applications are necessary to help you perform better at your job.
There are some free applications that you should download right away. The first application that is necessary for real estate agents to download and use is Zillow. Zillow gives you a home search and valuation. You can stroll through a neighborhood with the map feature. You should also download Cable XT. This is a side-by-side calculator and notepad. You are able to make quick calculations on a jumbo calculator and scribble notes in at the same time.
You will also want to download Keynote on your iPad. This is not a free application but a must-have for real estate agents. Whether you use a Mac or PC, you can load, create and share presentations on this application. Talk about “wowing” a client! No need for paper listing agreements and presentations with the DocuSign application. You can digitally sign any document anywhere with the advanced application for the iPad. Photogenie and/or Camerabag are two photo editing applications that offer a full suite of editing tools and also several filters and borders which make the picture all that more attractive. Pages is an application that allows you to make lists, start docs and compose articles. That way you can blog and organize your to-dos from virtually anywhere. Tweetdeck and Twitteriffic allow you to monitor keywords and people to stay current on the happenings around you.
Now that you have the applications on your iPad you need to run your business you can do many things on the fly. You can launch a listing presentation, preview property, provide clients a cleaner, greener listing presentation, share and save important documents and forms and much more. Your business will run smoother, be less stressful and at the same time, look super-professional.
Make the leap to the new technology and make your life much easier. Once you do this, you will never go back to the old way of doing things. It is just important to step out of your comfort zone and try something new that will help you and your career.
A Homebuyer’s Story
Working at OwnACondo.com, people often tell us why they decided to buy a condo or house at this time, and here is just such a homebuyer’s story.
Joan had moved around a bit after college, going where the jobs took here, to Boston and elsewhere. Now that she is back in the Chicago area, she decided that she had enough of apartment living. She heard a lot of gloom and doom from people who said this was not a good time to buy, but she had realized that now really is a good time. After all, she figured, as hard to believe at it is, we have 1963 mortgage rates. Imagine, getting a loan for the same interest that it would have cost almost 50 years ago. That is a hard deal to pass up. Of course the prices of homes have multiplied since then, but so have wages and everything else. But you can still borrow money at the same rate as when John F. Kennedy was president.
Besides the price of the loan, a homebuyer’s story also has to consider house affordability. In this case, Joan was looking at both condos and houses, and she found the ideal single-family house in a southwest suburb. Because she has a large dog, a Dalmatian, she had wanted to buy a house but was afraid initially that she would be limited to buying a condo due to the price. However, due to the low interest rates and the seller’s interest in coming to a deal, she was able to get a nice, two-story house near a park for what she considered a steal. So deals are out there, but sometimes you have to be patient. Joan actually had been looking for several months, and one deal actually fell through, but she took her time and did not get discouraged. All the naysayers were surprised and happy for her when she finally landed her dream house, even in this economy.
Of course, housing affordability varies between cities, so whether in Chicago or Minneapolis, or New York or Miami or L.A., a homebuyer’s story is going to be different. In Joan’s case, she bought a three-bedroom house for a little more than half of what her sister bought a one-bedroom condo for in suburban New York City a few years ago, but prices have gone down in New York too, and there are deals to be found now in every city. And they are not just on dilapidated, foreclosed properties. Joan’s house was in walk-in condition, and she couldn’t wipe the smile off her face as she turned that key in the door of her new home.
Real Estate
There have been so many changes in the real estate market the past decade it is almost too much to keep up with. It is not only what has been going on regarding buyers and sellers but real estate agents today are much more sophisticated than ever before. The one area that has had the most impact is technology which has completely changed how realtors today conduct their business. The internet has become an integral part of every company and agent in which to conduct their business. It allows agents and companies to spread themselves and the marketing of properties to a whole new level. Creation of websites allows marketing to be conducted 24/7 reaching many more customers at times the customer wishes to access information important to them. It is a tool all agents and companies should add to their tool box but it will never be the magic answer to successfully selling real estate. The internet alone will not make a unskilled agent a skilled agent. Success or failure in real estate relies on many factors.
One of the most important skills needed today for successful real estate agents is time management. Time is something we can never make but we can certainly make money. Most agents feel their time management skills are adequate but if they to take a look at what they do each day and each week they would be surprised to see how little time is spent doing what they need to do to make a living. Too many agents do not plan their days as any other business requires of their employees and it is relatively simple. The last thing before you finish your day is set your priorities and plan tomorrow. Sound easy, it is. When you have your day planned and written out it is much easier to stay focused on what needs to be done. Start with your first priority and stay focused on it till you have finished it. Then move on to the next until your schedule is completed which does not always mean you will complete all your scheduled events each day but at least you are managing your time and determining what priorities will make you successful. Real Estate agents today cover more ground and are required to work with a greater variety of customers than they have in the past. It is not uncommon for agents to cover vast geographic areas whether they are in an urban or rural setting so managing your time effectively can mean more sales and more money.
Real Estate Jobs
Real estate agents are licensed professionals requiring completion of initial educational requirements and to maintain their license they are required throughout their career to take continuing education courses. It is not an easy task to become a licensed realtor and to succeed requires time, energy, creativity and money. Most real estate agents are independent contractors which means they pay their own expenses no matter if the market is booming or bust. As with most parts of the country real estate jobs are currently plentiful but opportunities are there for the taking if you have that entrepreneur spirit that most successful real estate agents possess.
Most people think real estate agents do nothing all day but drive around in their big cars, show a few homes, go to the country club and pick up a big check every few weeks. Nothing is further from the truth. The true job description of a successful real estate agent is longer than most CEO’s of major corporations. Agents are small or big depending on their success, independent business owners who must be counselors, financial experts, expert negotiators, educators, marketing specialists, public relations experts, and more often than not a chauffeur. When it comes to buying or selling real estate there is little a real estate agent does not do for their customer or client.
Real estate jobs in major metropolitan areas offer their own set of challenges and real estate jobs in Chicago are no different. Chicago is approximately 228 square miles covering over 77 different neighborhoods. As an agent how do you choose what areas in which to work? Obviously you would like to work close to home but that is not always possible or the best choice. Agents many times travel long distances and work long hours to service their customers and clients. Real estate agents derive most of their business from friends, family, and the referrals they generate which means they will list or show property over the entire metro area as well as surrounding suburbs and counties.
The real estate business can be a rewarding career but not for the faint of heart. Real estate jobs offer many challenges and opportunities for those who possess that entrepreneurial spirit and are willing to put in the time and effort required to be successful. For those of us who have made real estate a lifelong career there is no other job or career that can compare.
Chicago condo market
Let’s be honest. The national real estate market is certainly facing its challenges and the Chicago Condo market is no different but there are some reasons to be optimistic about what is happening across the nation and more specifically in the Chicago market. The Chicago Tribune reported new housing and condo developments have undergone a record seven month decline, which may be the reason the Chicago condo market is somewhat stable. The lack of new developments has helped to slow a glut in the housing and condo markets for Chicago and we are beginning to see prices stabilize. I am hearing from many potential condo buyers that they expected a big collapse in prices so they could pick up a condo cheap but they now think that collapse may never happen. We could very well be at the bottom of the housing market which means there is no way to go but up encouraging buyers to get in the market for those great deals before they are all gone.
The Chicago condo market is improving due to the current rental market. Chicago is known for the consistency in which rents increase. The media has sensationalized the troubles in the real estate market regarding the difficulties in getting financing to purchase a home or condo which has encouraged landlords to increase their rents year after year believing the market is glutted with renters. Nothing could be further from the truth. With the advent of rent to own programs and the $8000 tax credit more and more potential first time home buyers are entering the market. There is no question even in today’s real estate market that owning a property is a much better alternative if you intend on staying for at least 4 or more years.
Historically, the Chicago condo market has been volatile with its many well known developers, political movers and shakers and just the attitude of its residents. Chicago is such a mix of cultures and nationalities with over 77 different neighborhoods that condo buyers have a variety of choices from the more upscale Gold Coast to the excitement of Wrigleyville. There is no place like the city of Chicago and all it has to offer from the dozens of museums to professional sports for those who want to live in one of the most exciting cities in the world. Check out the condo market in Chicago, you will be pleasantly surprised.
2010 Illinois Housing Market Forecast
The 2010 Illinois Housing Market Forecast released by the Illinois Association of Realtors® (IAR) is generally optimistic, predicting increases in year-over-year condo and single-family home sales and median prices declining at a slower rate than in 2009.
Economists from the University of Illinois Regional Economics Applications Laboratory (REAL) prepared the IAR study, which credits the First-Time Homebuyers’ Tax Credit extension for some of the improved sales projections.
“The momentum gained by the homebuyer tax credit stimulus and plans for more streamlined at-risk loan modifications as well as recent positive reports related to jobs and the economy should carry forward into the 2010 housing market,” said IAR President Michael Onorato.
Statewide, the IAR study predicts that total home sales (single family and condominiums) in most of 2010 will be positive compared to 2009. However, the study notes that sales had declined dramatically in 2009 so there is a lot of ground to make up.
Home and condo sales predictions made in the 2010 Illinois Housing Market Forecast for the Chicagoland Primary Metropolitan Statistical Area (PMSA), which includes Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will counties, are slightly less positive.
“Overall, compared to the sort of forecasts we were producing this time last year the outlook is much better for 2010 and we will begin to see the starts of some sustained pick-ups month after month in the positive range,” said economist Geoff Hewings, director of REAL. “The downward trends that we’ve been watching over the last year and a half are beginning to bottom out.”
Joblessness and foreclosure rates factor into the housing market recovery. Illinois employment has declined annually since November 2000. The consensus among economists is that employment levels will increase over the next 12 to 18 months, but not fully recover until 2016.
“The most critical factor for housing in 2010 is what happens to employment,” said Hewings, predicting that until consumer confidence in the economy is restored, housing transactions will primarily come from households relocating due to jobs and retirements.
Median prices for condos and single-family homes are expected to continue to decline moderately, compared to 2009 in Illinois and the Chicago region. For the Chicagoland PMSA, the 2010 median is expected to be $184,900, a 4.4 percent decrease from 2009.
“Until those foreclosed properties work their way through the system we won’t have a price recovery that will match the sales recovery,” says Hewings. “Most people are seeing the foreclosure peak occurring in 2010. Particularly in Chicago we are seeing the influence of many more foreclosed properties on the market but compared to a lot of other metropolitan areas it’s still nowhere as bad as it might have been if we look at markets in Miami and California for example.”
Illinois Housing Market Forecast data is generated from a survey of Multiple Listing Service sales reported by 37 participating Illinois Realtor® boards and associations.
Why Should I Buy Now?
All we hear right now is about unemployment, health care reform and bailouts. That doesn’t mean there has not been talk of the real estate market and what is happening in that part of the economy. The question I am hearing more each day is, why should I buy now? Depending on who you listen to the market may or may not be at its bottom and who in all reality can forecast it. Many of those so-called forecasters were the ones that missed all aspects of the economy as it was tumbling downward. And down is not always a bad place to be since the only other way is up. Whether we are at the bottom, close to the bottom or on our way up it is a good time to buy your home or condo.
Why should I buy now? There are several factors that are in your favor by acting now.
Pride of ownership is the number one reason people want to buy a home. Home ownership offers you and your family a sense of stability and security while making an investment in the future.
Home ownership is currently one of the best tax shelters available with the volatility of today’s stock market. Mortgage interest is fully deductible on your tax return which lessens your tax burden year after year.
Mortgage reduction builds equity in your home. Each month you make a payment the principal portion of your loan goes down and as the principal goes down and the price of your home goes up, you are building equity or more asset value.
Another reason to ask yourself why should I buy now is interest rates are lower than they have been in years. Do you realize that you may be able get a 30 year fixed rate for less than 5% which makes a purchase start to look very appealing and if you tie that with anticipated inflation you will be paying back the loan with devalued dollars meaning you are getting more for your money than when you started. That means you can afford more home or if you want you can buy a more reasonably priced home and keep the payments low, maybe even less than you are paying in rent. Would you have imagined several years ago that you could get free money and a great interest rate on buying a home? If you are like most of us you would have laughed us out of the place, but it is happening now. We would never have guessed it just like we are never going to guess the bottom of the housing market. So just do it!
