Sweet Home Chicago

Kiplinger Forecast for 2009

Toward the end of 2008, Jon Frandsen wrote an article at Kiplinger.com titled  "12 Things to Look Forward to in 2009."

Here is my favorite part:

2009 Will Be a Great Time to Buy or Refinance a Home. The median home price nationally has fallen 20% since the housing market’s peak in July 2006, according to the National Association of Realtors. That’s especially good news for first-time home buyers or anyone who doesn’t have to sell a home before they buy, as well as patient buyers who can handle the time consuming process of buying a distressed property. In mid-December, the 30-year fixed rate fell to 5.17%, according to Freddie Mac. Mortgage money hasn’t been this cheap in nearly 40 years. Buyers who are having trouble coming up with a 10% to 20% down payment or who have dings in their credit record may be able to get Federal Housing Administration financing with as little as 3.5% down. And there may be help for people already in their homes.

Borrowers facing a reset on adjustable mortgages may get relief, since key indexes have dropped. And for those teetering near foreclosure, the Obama administration and new Congress will help more distressed homeowners keep their homes.

You can read the entire article by clicking here:  12 Things to Look Forward to in 2009

My thoughts (a month after the above article was written):

• The new administration and the new Congress will only be able to help a limited number of people that are facing foreclosure.  If you don't have a job or some type of income, there is little that they can do for you.  If you do have some income, and your payments got too high due to an ARM adjustment, you may be able to get some relief.
• Buying a distressed property (short sale, pre-foreclosure, or foreclosure) takes more than time.  It takes patience, and nerves of steel.  I'm working on a couple of these deals and they are not for the average buyer.
• Refinancing sounds like a great idea when you hear the current interest rates....unfortunately, my mortgage resources tell me that many of the re-fi deals are falling through because properties aren't appraising high enough, or the borrowers aren't qualifying.  Doesn't mean that you shouldn't try refinancing, but beware, it may not work.

Thank you for reading.  Your comments are always welcome!

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The Great Chicago Pizza Tour

My son, like me, is a big fan of everything Chicago.  He is currently living in Michigan, as a student at Michican State University (MSU).  He is very happy at school there, though he does have one big complaint - it is the pizza in Michigan.  Nothing compares to Chicago-style deep dish pizza!

And so it began...after all the holidays were over, with one more week to go on his winter break from school, my son hosted the first (dare I say annual, or semi-annual?) Great Chicago Pizza Tour.  Five of his buddies from MSU converged at our house.  A couple of his local friends joined the tour too.  The first night we ordered in from our favorite local pizza parlor.  The students' (originating from Washington D.C., Cincinnati, Michigan, and China) eyes popped out of their heads when we opened the pizza boxes up - and then they happily dug in.

The next day they visited three different pizzerias in downtown Chicago in a 9 or 10 hour period.  In between "meals" my son had them trecking through the snow to take in some of the many sights (historical and architechtural) downtown.  Since he lived in the city during the prior school year, and he has studied a lot of Chicago history, he really knows his way around.  He can show you where parts of the recent Batman movied were filmed, and also point out all the cool buildings and parks and other key places of interest.  I think there was also some sight seeing from the car too - they went down Lake Shore Drive and up Sheridan Road.  He showed them a little bit of the east side of Highland Park and they also drove through Fort Sheridan.

Then, on the last day of the tour, they went to two more places out in the suburbs.  At the end of it all, there was no consensus on which place had the best pizza.  Each one was unique. However, they were all in agreement that Chicago pizza is the best!

Back at school, my son reported that the students who didn't come on the tour are now asking when the next tour will be...

I just love living here! Yes, even with the sub-zero weather we're having!

Thanks for reading.

nsk

Neighborhood Watch and Lake Forest's Finest

I was showing some houses in Lake Forest this week, and had a run-in with the law! 

We had appointments to see three houses on the same block in Lake Forest.  All of the houses were vacant, and with all the snow on the street and in the driveways, we decided that it would be easier to just park in the driveway of one house, and walk to the other two.

As we were leaving the third house, three police cars pulled up to the house, and officers jumped out of the cars to approach us as we were leaving.  We were quite surprised, and asked if we had accidentally tripped an alarm or something.  Then they told us that they received a call from a neighbor about two people forcibly breaking in and entering the house! 

As the 4th police vehicle pulled up to the scene, I was explaining to the very nice officers that I am a Realtor and that we had appointments to see these three houses.  As it turned out, the third house does not have a for sale sign in front of it, so the neighbor that called to report us probably didn't know that the house was for sale.  The officers said that the neighbor knew that the house was vacant and was concerned when she saw us there.

So, kudos to the Lake Forest neighbor that is watching out for the property on her block.  And, kudos to the Lake Forest police who responded promptly!  Thankfully the policemen quickly realized that most burglars don't carry a clipboard with them as they are leaving the scene of the crime...

We were able to clear things up very quickly - business cards, property information sheets, and driver's license all were helpful in proving our innocence.  The lock box on the front door was helpful too.

Some sellers don't like to have a "for sale" sign in front of their home.  This story shows us one reason why you should have one!

Thanks for reading!

nsk

Tax Credits for "Green" Home Improvements

The Federal Government is providing tax credits for energy efficient home improvements as of January 1, 2009, per the Emergency Economic Stabilization Act, signed by President Bush in October 2008. 

Before you start you home improvement projects, see if anything you are planning to do will qualify. (NOTE:  home improvements made during 2008 are not eligible for tax credit)

Some of the home improvements included are: windows, doors, roofs, insulation, HVAC, and non-solar water heaters.There are also tax credits available for solar energy systems,fuel cells, small wind energy system and plug-in hybrid electric vehicles.  New home builders can also get credits for building energy efficient homes.   click here for more details, www.energystar.gov

Thanks for reading!

nsk

Going Green and Saving Green ($)

Greening your shopping trip

I've bought a few of those canvas shopping bags that you see everywhere these days.  I even have one that is insulated, which is great for frozen or refrigerated food items in the warmer months (not an issue right now).  Initially it was difficult for me to remember to bring my bags into the stores, but I'm getting better at that. For a big trip I also have a supply of paper bags from previous shopping expeditions.  I carry all of them into the store inside one of the canvas bags.

Taking the eco-friendly thing one step further, if I go to the meat or fish counter, I have them use a minimal amount of packaging for my purchase.  I tend to re-wrap whatever I buy, so the extra packaging they use (like those little "styro" trays) are really wasteful.

This isn't just about grocery shopping.  I've been bringing my bags into almost every store I go to.  I've gotten some strange looks, but I don't care.  If I'm just getting a couple of small items, I just tell the cashier I don't want/need a bag.

How does this save you money?  Although it may not put any coin directly in your pocket, in the long run, less bags will reduce costs at the stores, which hopefully will get passed on to us.  You already know that this helps eliminate waste going into our garbage dumps, and will save some trees.

Have you driven by a garbage dump or land fill recently?  I'll be writing more about that shortly....

Thanks for reading.

nsk

 

 

 

The 2009 Real Estate Market

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Expert opinions on how the residential real estate market will fare in 2009 are mixed.  After reading and listening to many different views, here is my take on things.

First, here are some basic pieces of info that will affect the market in the coming months:

• For the past 2 years, more homes have been coming onto the market for sale each week than have been selling. This has created a large inventory of homes for sale.  That is why prices have been coming down, it is basic economics.  When supply exceeds demand, prices go down.
• The market of 2 - 3 years ago is gone.  People (especially sellers) need to forget about those prices because we aren't going to see them in the near term (certainly not in 2009).
• Easy credit allowed people to spend more and more on housing, while actual income levels did not necessarily increase at the same dizzying rates. The market is adjusting so that the cost of housing will be more in line with people's income.
• Incredibly LOW interest rates are available (around 5% as of this writing) to buyers with good credit scores and a 5 - 10% down payment. 
• In hindsight we know that the credit debacle was the first domino to fall in the financial industry...and now it's confirmed that we're in a recession.

The various experts seem to be in agreement that there will be a "bottom" to the residential real estate market in 2009 - however there is not any consensus on exactly when that will be.  I am hoping that the low interest rates and the low prices will spur demand among people that have been sitting on the side lines waiting for the right time to make a purchase. Until that happens, prices can and will continue to fall.  When it does happen, I do NOT expect prices to start climbing back up to the levels we saw a couple of years ago.  The are going to stay in the same ball park as they are now until the excess inventory is sold.  And that is going to take more than a year. 

The key to getting your home sold in 2009 will be to stay ahead of the market.  Your home needs to be seen as the best value compared to any other home in the price range in your area. I saw homes sell in 2008 in less than 30 days, some in only 2 weeks - and they key was the price versus the competition.

Best wishes for a very happy new year!! 

As always your comments are welcome.

Thanks for reading.

nsk