Home sales nationwide grew in February, according to the National Association of Realtors®, but home prices continue to decline in most areas of the country. Industry experts see this as an indication that it might take several more years for the real estate sector to recover fully.
The Pending Home Sales Index, a forward-looking indicator, rose 2.1 percent to 90.8, based on contracts signed in February, from 88.9 in January. The index is 8.2 percent below 98.9 recorded in February 2010. The data reflects contracts and not closings, which normally occur with a lag time of one or two months.
“Month-to-month movements can be instructive, but in this uneven recovery it’s important to look at the longer term performance,” said Lawrence Yun, NAR chief economist, who stressed the importance of looking at the broader trend. “Pending home sales have trended up very nicely since bottoming out last June, even with periodic monthly declines. Contract activity is now 20 percent above the low point immediately following expiration of the home buyer tax credit.”
According to Illinois Association of Realtors® data, statewide home sales, including single-family homes and condos, in February 2011 totaled 5,575 homes sold, up 1.3 percent from 5,505 sales in January 2011—and down 10.0 percent from February 2010. The median price in Illinois in February was $128,800, down 4.6 percent from $135,000 for the same month last year. The statewide single-family median price reached $129,000, up 1.6 percent from $127,000 in February 2010 and up 2.8 percent from $125,500 in February 2009.
While home sales are showing signs of recovery, data released March 29 by Standard & Poor’s, tracking home prices through January 2011, shows that home prices continue to drop in most areas of the country. The only metro areas in the United States that showed improvement in prices since last January were San Diego and Washington, D.C. San Diego’s figures rose just 0.1 percent over price averages seen in January 2010, but average prices rose more than 3.6 percent in Washington D.C.
Industry observers point to the unemployment rate, which remains about 10 percent nationally, as one reason for the reluctance of people to buy condos and other real estate, despite the low prices. In cities such as Washington, D.C., where the government accounts for many jobs, home sales have not been affected by unemployment as much as other areas.
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.
Oak Brook is a premier community with spacious residential areas containing many large mansions and condominium complexes. Oak Brook offers some of the most unique and exciting places to live in the Chicago area. One of the most attractive reasons many people choose to live in Oak Brook is the proximity to downtown Chicago and the fact that property owners do not pay property tax to the village, as services are primarily funded by sales tax receipts. Oak Brook has one of the most popular malls in northern Illinois and is home to many recognized national and international companies, such as McDonalds, Ace Hardware, Federal Signal Corporation, Lions Clubs International and many more.
Oak Brook was first incorporated in 1958 due in large part to the efforts of Paul Butler, a prominent civic leader and land owner. The family first came to the area in 1898 and opened a dairy farm. Early on potential residents recognized the beauty of the area and the wide open spaces in which to build. Much of the Butler land was acquired by the village including what is now the site of the Oak Brook Center shopping mall. Other properties were developed as well for the purchase of homes and condos and today Oak Brook has become one of the most sought after communities in the Chicago area.
The area is known for its interest in sports which is why many people have gravitated to the area. The village offers recreational facilities not commonly found in similar places of that size, such as the Oak Brook Sports Core, the Polo Grounds, and a nationally ranked golf course which was a onetime host to the Western Open. The area is known for its wide open spaces with walking and bike paths winding through many of the condo complexes in the area.
The census of 2000 counted 8,702 residents, small for most villages in the Chicago area but offering excellent police protection and state-of-the-art emergency medical services. The median income for the village is well over $140,000 which is why some of the most expensive real estate in the suburbs is located. Oak Brook condos come in many shapes and sizes with prices ranging from $99,000 to $1,000,000 offering an opportunity for residents to enjoy all Oak Brook has to offer. If you are a first time homebuyer or someone looking for a larger home with plenty of recreational opportunities to go around, visit Oak Brook, you will be pleasantly surprised!
As the real estate business continues to evolve, an ancient system of trading in the marketplace has come back into vogue and is continuing to expand along with the market.
Use of a real estate auction company has become more and more popular, especially due to the economic downturn, and their popularity is still growing even more.
Therefore, it's important to investigate why they have become so appealing and what benefits they can offer to people looking to invest in real estate.
According to the National Auctioneers association, more than $268 billion worth of completed sales started in auction companies. This means that auctions are one of the most accelerated sectors within sales for almost all varieties of property such as residential real estate or agriculture.
Use of a real estate auction company has grown for the past six years straight; however, some people are still misinformed about them and are wary of buying property through use of a company.
Nevertheless, using such a company to complete real estate transactions has a number of benefits. The following is a brief overview of some of them.
Usually, sales take less time, and can be completed in thirty to forty five days. This is because there are no long and complicated negotiations; the property is selling at its true market value.
Additionally, properties are sold with no contingencies, and there is no question of whether or not a deal will be completed. The sales approach is highly visible, and advertising campaigns often precede auctions that utilize brochures and brochures.
It also helps that both the buyers and sellers who are engaged in the auction process are ready to complete the deal; they are less likely to spend time deliberating or backing out of a transaction, and the results of the auction are immediate.
The reason why use of a real estate auction company to make real estate transactions has been in practice for such a long time is that it's extremely efficient and effective.
The company is able to foster a mood of excitement among potential buyers of real estate that promotes direct competition; in turn, this means higher prices are more likely than in conventional real estate business deals.
The seller will receive a higher price, and the buyer can be sure that he isn't paying anything beyond market value, or possibly less. Both parties involved in the auction can benefit from this procedure of selling real estate.
Condos in the Chicago area
Being a prospective home buyer looking for condos in the Chicago area can be both fun and intimidating at times, due to the number of options available. Of course, location and price are always the most important considerations, but seeing so many attractive luxury condos in prime locations can be tempting, even if they are a bit out of your price range.
It can be fun perusing the upscale developments in prime locations near downtown, the Magnificent Mile and the lakefront, or even in easily accessible suburbs. Many of the luxury condo high-rises offer attractive amenities such as pools, state-of-the-art fitness centers, and concierge service. Being so close to all the nightlife, shopping and cultural activities that Chicago has to offer is an added value, and the views of the city and Lake Michigan from the balconies and rooftop gardens can be breathtaking.
But when it comes to financing a condo, there is no need for a prospective buyer toget discouraged if the most expensive condos in the Chicago area are a little out of his or her desirable price range. Prices can vary a great deal, even within neighborhoods. So it is possible to find an affordable place in nearly the same location, still close to everything but having perhaps a few less amenities, but a more manageable price tag. Bargains can be found, especially if people are willing to expand their searches beyond the trendiest of neighborhoods. Many attractive condos and lofts in distinctive buildings, both newly built and renovated, are available in such up and coming, or gentrifying neighborhoods like the South Loop, Bronzeville and others.
Furthermore, there is no time like the present for buying condos in the Chicago area. Besides the fact that interest rates remain low, and a wealth of available properties makes it a buyer's market, now would be a good time to take advantage of the $8,000 tax credit for first-time homebuyers has been extended through April, as long as the deals are closed by June. The tax credit program has even been extended to include existing homeowners, who now may obtain a $6,500 tax credit.
Both programs require applicants to meet certain income limitations. The income limitations for first-time home buyers are $75,000 for single taxpayers and $150,000 for married couples filing jointly. To get the full $6,500 credit, current homeowners may earn up to $125,000 annually as single filers, or $225,000 for joint filers. Those who make ore than that can get reduced tax breaks.
Real estate auctions are another great way to get great deals on condos in the Chicago area, because they bring motivated sllers and buyers together.
No one knows what the future holds for you, your family, your job or your finances. But owning your own home is a part of the American dream. This concept of the American dream is so deeply ingrained in our psyche that we sometimes may not make the right decision at the right time in our lives. When making this all important decision to buy that first house or condo it is important that you know all you need to know to make an informed decision.
One of the first things you need to know before you start thinking of owning your own home is if it is the best choice for you. There was a time that very few Americans owned their own homes. It has only been relatively recent that home ownership was available to the masses and that availability is increasing every day. Financing has become must easier to obtain and potential home owners are becoming much more financially savvy than any other time in our history. With all of this it is still wise to look at owning your own home as a financial transaction. There are definitely economic differences in renting and owning. At one time you could get a better return in the stock market but nowadays with the uncertainty in the financial markets that may not a valid argument. On the other hand, Uncle Sam offers some tax deductions the stock market cannot duplicate. Each year as a homeowner you can deduct part of your mortgage interest and real estate taxes if you exceed the standard deduction which most homeowners do in the first few years of their mortgage. This can be a windfall for most first time home buyers because most will receive a tax refund for those first few years.
When you have decided that owning your own home may be a good decision look at some of the pluses in which a dollar value cannot be assigned. First of all there is the pride of ownership. It is by far the number one reason people ultimately buy their first home which gives you that sense of stability and security that you have made an investment in the future. By owning your own home you have the freedom to paint the walls whatever color you desire and crank up the stereo without fear of your neighbor pounding on the ceiling to be quiet. You can choose the decorating that best suits your tastes and change them whenever you like. Owning your own home is a part of the American dream and who doesn't like for dreams to come true.
Congress has extended and expanded the homebuyer tax credit. Certainly good news for buyers, sellers, lenders and real estate agents since the credit is designed to give the real estate and mortgage industry a much needed shot in the arm. As with most of what our government does there are always some questions about who is eligible and exactly what one can expect.
The homebuyer tax credit now runs until April 30, 2010, a six month extension from the original program which is hoped to add another approximately 350,000 purchasers to take advantage of the program. The program has been extended to include current homeowners which should expand the number of people taking advantage of the program to over 500,000. There are some key areas and questions that need to be clarified for those thinking now may be the time to make a move as a first time buyer or current homeowner looking to find another home.
Existing homeowners must have used the home sold or being sold as a principal residence consecutively for five of the previous eight years. It does not matter if your new house costs more or less as long as you meet the above requirement. Your credit as a current homeowner will be $6500 or $3250 if married and filing separately. Income limits have also been increased to include more people eligible from $75,000 for single and $150,000 married to $125,000 single and $225,000 for married. In the original plan there was no limitation on cost of the purchased home but that has now changed to a $800,000 purchase price which is well above the median price of homes. The original plan called for the home to close no later than December 1, 2009 but the new plan has been expanded to include any home that has a binding contract to purchase in effect on April 30, 2010. The purchaser has until July 1, 2010 to close to be eligible to receive the tax credit.
The homebuyer tax credit is an effort to jump start the housing market and hopefully more than the half million expected homebuyers will take advantage of the program. With the volatile stock market and unemployment rising any advantage is a welcome addition to helping us get back on our feet. As many economists have said, the strength of the housing market is an indicator of economic activity and the economic strength of this country.