Karp Real Estate

North Shore Market Watch - Skokie

This is my 7th post in a series about the local real estate market in the individual communities on Chicago's North Shore. (See my recent previous posts for an overview of the North Shore real estate market and information on specific communities and watch for my next two posts which will complete the series.)

Skokie

• Skokie had a 10.1% increase in the number of homes sold in 2011 versus 2012.  Increases were seen for both single family homes (+9.6%) and condos/townhomes (+10.9%).
• Over 47% of the sales in Skokie were distressed properties.  Bank-owned properties represented 31.6% of closed sales in 2011 and short sales were 15.5%.
• Inventory is below the North Shore average, but still on the high side with over 9 months of single family homes available for sale and over 13 months of condos/townhomes.
• The number of distressed properties in Skokie is higher than any of the other North Shore communities.  There are 408 homes in pre-foreclosures and 180 bank-owned properties. This represents 2.3% of the total housing units (THU).  This is about the same number of distressed properties that I saw in Skokie last July, though the mix has changed.  In July 2011 there were 430 properties in pre-foreclosure and 159 bank-owned properties.  This suggests that an increasing number of homeowners in Skokie are struggling to pay their mortgage.
• As you would expect with a high number of distressed property sales, median prices declined in Skokie.  The median price for a single family home declines by 11.1% and by 23.6% for condos/townhomes.

With the high level of distressed properties in Skokie (and this number appears to be increasing) I do not expect to see prices stabilizing during 2012. However,  I do expect the number of home sales to continue to increase in 2012.

More to come.

Thank you for reading! If you want to know what is going on in your local market and why, please contact me directly.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

North Shore Market Watch - Kenilworth and Lake Forest

This is my 5th posting in a series about the suburbs on the North Shore of Chicago.  Look at previous posts to see how the North Shore compares to the state of Illinois, the whole Chicago metropolitan area, and the city of Chicago.  So far, I've already posted statistics for Deerfield, Evanston, Glencoe and Highland Park.

Kenilworth

• The number of homes sold in Kenilworth increased from 33 sales in 2010 to 35 sales in 2011.  All of the sales were single family homes.
• Two of the 35 sales were shorts sales, and the rest were traditional sales.
• There is 12 months of inventory in Kenilworth, which means that it is still a buyers’ market with supply exceeding demand.  This is slightly higher than the North Shore average of 11+ months.
• There are 6 homes in pre-foreclosure in Kenilworth and one that is bank-owned.  This represents 0.9% of the total housing units (TNU) in Kenilworth.  There were 9 distressed properties in Kenilworth in July 2011, so this is an improvement.
• The median price increased from $1.34 million to $1.6 million. 

Kenilworth is a very small (and expensive) area of less than 900 homes.  All of the statistics for Kenilworth are based on a much smaller number of homes than the other communities, so it is not really appropriate to make direct comparisons.  Even though the median price increased in this community, I think it is too early to say that real estate values have really gone up. All of the other indicators suggest that Kenilworth is not completely out of the woods yet, though things are moving in the right direction.  The recent improvement in interest rates on jumbo loans will definitely help this market turn around.

Lake Forest

• Lake Forest sales decreased by 9% in 2011 versus 2010.  Single family home sales declined by 10 homes from 217 to 207, -4.6%.  Condo/townhome sales dropped by 24.2%, from 62 units in 2010 to 47 in 2011. 
• Almost 90% of the sales in 2011 were traditional sales.
• Inventory levels are still rather high, with more than 16 months of inventory for single family homes and 18 months for condos/townhomes.  This is much higher than the North Shore average of 11+ months for single family and 13+ months for condos/townhomes.
• Tax records show that there are 48 homes in pre-foreclosure and 15 bank-owned properties, for a total of 63 distressed properties.  This represents about 0.8% of total housing units (THU) in Lake Forest.  Last July there were 69 distressed properties in Lake Forest, according to the tax records.
• The median price of a single family home increased in Lake Forest by 3.7%, while the condo/townhome median price dropped by 23.2%.

The statistics for this community are mixed.  On the negative side, sales decreased versus year ago and inventory levels are high.  On the plus side, not a lot of distressed properties (though the numbers are about the same as 6 months ago) and the median price for single family homes has improved.  Overall, I think the turnaround for Lake Forest is slightly behind Highland Park.  I expect sales to increase in 2012 with prices declining and then possibly stabilizing toward the end of the year.

More to come.

Thank you for reading! If you want to know what is going on in your local market and why, please contact me directly.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

North Shore Market Update - Glencoe and Highland Park

This is 4th posting in a series about the housing market on Chicago's North Shore.

Glencoe

• Glencoe had a terrific year with 24.5% more homes sold in 2011 than in 2010. 
• Less than 15% of the home sales were distressed properties (short sales or bank-owned).  More of the distressed property sales were short sales than bank-owned properties.
• Inventory levels are a little high for both single family homes and condos/townhomes at just over 9 months for all types of homes.  This is the only negative indicator for Glencoe right now.
• The number of homes in pre-foreclosure or bank-owned declined slightly from 27 last July to 25 now.  This is less than 0.8% of the total housing units (THU) in Glencoe.
• The median price of a single family home in Glencoe stayed exactly the same in 2011 versus 2010.  Median prices for condos/townhomes went up in 2011 versus 2010, but this was based on only 5 sales, so I am not going to report that number. 

All of the measures above are very positive.  I expect sales to continue to increase in Glencoe and as this activity increases, we may see some modest price increases in the coming year.

 Highland Park

• The number of homes sold declined by 2.8% in Highland Park in 2011 versus 2010.
• Over 90% of the sales were traditional sales (not short sales or bank owned properties). 
• Inventory levels in Highland Park are high, with over 12 months of inventory for single family homes and over 19 months of inventory for condos/townhomes.
• Similar to Glencoe, the Shadow Inventory (homes in pre-foreclosure or bank owned) is 0.8%  of toal housing unit (THU) in Highland Park – this is good.  Last July there were 121 properties in pre-foreclosure or bank owned.  Now it is down to 93.
• The median price for single family homes in Highland Park declined very slightly, by 1.1% versus 2010.  Condo/townhome median price grew by 33.6% (which is a bit of an anomaly with over 19 months of inventory).  

While the statistics for Highland Park are not quite as good as Glencoe, I think that this market is also on a positive path, maybe a few months behind their neighbors to the South.  I expect sales to increase and then prices should begin to stabilize in the second half of the year.

More to come.

Thank you for reading! If you want to know what is going on in your local market and why, please contact me directly.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

North Shore Market Update - Evanston

This is third article in a series about residential real estate on Chicago's North Shore. Watch for more communities in subsequent posts!

Evanston

• The number of homes sold in Evanston declined by 9.7% in 2011 compared to 2010.  For single family homes the decline was 7.5% while condo/townhome sales declined by 11.7%.  This community is not keeping up with the sales activity in the state, the greater Chicago area, or even within the city of Chicago.  In fact, Evanston had the worst performance on this measure among all of the communities that I analyzed. (Though Lake Forest was not far behind with a 9% decline in sales in 2011.)
• Similar to Deerfield, over 20% of the sales in 2011 were distressed properties.  In Evanston the majority of the distressed sales were bank owned properties.
• Inventory for single family homes in Evanston is down to 7.4 months, which is very good.  Inventory of condos and townhomes in Evanston is 14 months, which is not good at all.
• The number of bank-owned homes and homes in pre-foreclosure in Evanston dropped since last July.  There were over 400 distressed properties according to public records, and now it is down to 340.  These distressed properties represent 1% of total housing units (THU) in Evanston.  For the North Shore as a whole, this is about 1.3%, so this is a positive sign for Evanston.
• The median price for a single family home in Evanston dropped by 2.3%, not bad compared to the state, the greater Chicago area, and the city of Chicago.  However prices for condos and townhomes dropped by almost 15% in Evanston. 

So, as in July when I did my last report, the city of Evanston is a tale of two cities.  Sales and prices for single family homes are showing modest declines, while condos and townhomes are showing dramatic declines.  Bottom line is that demand for condos and townhomes is still lagging.  The one positive for the Evanston market is that the inventory of distressed properties, the “Shadow Inventory”, has improved.

For 2012 I think we will see the number of home sales increasing in Evanston, but prices will continue to decline, especially in the condo/townhome market.

More to come.

Thank you for reading! If you want to know what is going on in your local market and why, please contact me directly.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

 

 

North Shore Market Update - Deerfield Illinois

This is second article in a series about residential real estate on Chicago's North Shore. Watch for more communities in subsequent posts!

Deerfield

Deerfield is one of two rising stars on the North Shore with a 23.8% increase in the number of homes sold in 2011 versus 2010.  (Glencoe had a 24.5% increase.)

• Over 20% of 2012 home sales were distressed properties (evenly split between short sales and foreclosures). 
• The inventory levels at the end of the year were still a bit high with 9 months of single family homes and over 12 months of condos/  available for sale (7-8 months is closer to “normal”).  This means that we still have more sellers than buyers.
• According to public records there are over 90 homes in pre-foreclosure in Deerfield and 27 bank-owned properties.  These represent about 1.7% of the total housing units (THU) in Deerfield, which is the second highest percentage among the communities I analyzed on the North Shore.  This is slightly higher than when I looked at this number in July of 2011 (1.5% of THU).  Only Skokie has more distressed properties as a percent of THU right now.
• Median sale prices for single family homes declined by 13.5%.  Median prices for condos fell by 11.5%.  These declines are worse than the state, and the Chicago PMSA.  And similar to the city of Chicago.

Overall I think that Deerfield is heading in a positive direction.  Once the distressed properties are out of the market, the downward pressure on prices will relax and we will see some stabilization in prices.  For at least the first half of 2012 I expect to see continued price declines in Deerfield.

More to come.

Thank you for reading! If you want to know what is going on in your local market and why, please contact me directly.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

 

 

Advice for senior citizens considering a move.moving

There was a short article in the local paper recently with advice from a real estate agent in the area on this topic. I am in TOTAL disagreement with the response that this agent gave, and so here is my advice on this topic.

(FYI, this agent basically recommended that the seniors stay where they are until prices get better.)

For the most part, the majority of senior citizens do not have a mortgage. They have either lived in their home long enough to pay off their mortgage, or they may have downsized into a townhome or condo, with a low mortgage or no mortgage. Based on my experience working with seniors, I have found this to be very true. Of course there are exceptions to this - there always are when you make generalizations, but I'm using this assumption of no mortgage.

With this in mind, if you (or your loved) one are thinking about moving into a smaller space, or moving to senior community with planned activities and meals, or if you they need to be in an assisted living facility, you should take action to sell your current home immediately. While it is true that you will not receive the windfall dollars that you would have if they sold during the bubble of 2005/2006, you can sell at a reasonable price, the new normal, of today's market. If you have lived in you single family home for over 30 years, you will not be "losing" any money by selling in today's market. Prices are definitely higher than they were back then.

If you are selling a townhome or condo, or any place you have lived for less than 7 years, then you may end up selling below what you originally paid for the place, depending on when you bought, the condition of the property and the location. At the end of the day, you really need to think of this "loss" as the cost of living in that property. If you do the math, the dollar amount of the loss is probably less expensive than if you had been renting for all those years. And, if your money had been invested in the stock market during that same time period, you could be in the same position.

What I have learned from personal experience is that it is more important to get on with your life and live where you want/need to be than to worry about losing some cash on the sale of your home. I think this is especially true for seniors. Maintaining a single family home is a lot of work and it can be expensive. And if you are living alone, this can be an overwhelming burden. If you are having mobility issues, moving into a space without stairs can be a very positive change for you. If you live alone and don't drive anymore, there is no need for you to remain isolated in your home. There are many other options.

My last point is probably the most important. THE PRICES WE SAW IN 2005 AND 2006 ARE NOT COMING BACK ANY TIME SOON. I have heard this phrase too many times: "I want to wait until the market gets better." As I've said previously in this blog and to many people in person, we are going to continue to see declining prices until all of the distressed properties are sold. Experts are saying that there will be more foreclosures and short sales during the first quarter of 2012. And after that, at some point prices are expected to rise...but the annual increases will be at a rate of 1% o to 1.5% a year. That means it could be more than 20 years before we see those bubble prices again, if at all.

So, what are you waiting for?

Thanks for reading!

nsk

Nancy S. Karp

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

Trying to Refinance (and you don't have a Fannie or Freddie Mortgage)?

I know I said that I would write more about real estate property assessments.  I promise I will get to that....FYI the Lake County assessments have been published and sent to homeowners.  You have less than 30 days to appeal your assessment. Today's topic really strikes a chord with me....read on...

Trying to Refinance

The Federal government recently announced a program (HARP) that provide some relief for home owners that have paid their mortgages regularly.  This is exactly what many home owners today want and need.  It is a “reward” for staying the course and doing the right thing, even though your home value has declined and you are very likely upside down, or close to it.  Basically home owners will be allowed to refinance with much lower interest rates without getting an appraisal, as long as they have good credit and are current on their mortgage.

The problem is that this program only applies to Freddie and Fannie mortgages.  So what about all of the other home owners who have also stayed the course and continued to pay their mortgage and home equity loans in the face of falling prices.  Many people would love to refinance and take advantage of today's incredible rates, but they can’t get approved because their loan-to-value (LTV) is over 95% or possibly worse (and still sliding).  Many of these people are struggling to make ends meet.  If they could refinance the monthly savings would give them much needed breathing room. 

I don’t know how many people are in this situation, but I am sure that it is huge. I'd love to start a grass roots campaign to lobby the government to take action to encourage the banks to reward those of us who have been playing by the rules!!  If a significant number of people could save some real $$ on their mortgages it would be a boost to the economy.  These people could use it to purchase goods and services, pay off other debts, go on vacations, or maybe build up their savings so they have a safety net once again.  I realize that the banks will probably lobby against this because they say that they'll lose money on this scenario. I think that in the long run this is better option for the banks than strategic defaults, short sales, foreclosures and bankruptcy…don’t you?

I confess that I am among the many homeowners in this predicament.  So this topic is near and dear to me.  If you have any ideas on how we can get some attention in Washington D.C. on this topic, let me know...I'm all ears.  Feel free to repost this blog - as long as you give me credit for the original content, that is fine with me...

(FYI, photos are from my recent trip to historic Galena, IL)

Thanks for reading!

nsk

Nancy S. Karp

 

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

Property Taxes and the Value of Your Home

Real estate taxes have been a sore subject for many people in our community lately.  I find that there are several common misunderstandings about our property taxes among the general public.  The biggest confusion lately is about the relationship between the tax bill and the value of our homes.  People are frustrated that their tax burden seems to be increasing while their home values continue to decline.

So in my first article about property taxes I am going to answer this question:

“Why have my real estate taxes gone up while the value of my house has gone down?” 

First of all, it is important to understand that our real estate taxes are used to cover the budgets of several different government entities that provide services to the community.  Some of the specific items will vary by community.  For an example, here are the taxing bodies listed on my tax bill for Highland Park, which is in Lake County:

• Lake County
• City of Highland Park
• Park District of Highland Park
• Moraine Township
• Highland Park library
• Mosquito abatement
• School districts (we have two districts, one for K – 12 and another for the high school)
• College of Lake County
• North Shore Sanitary District
• Forest Preserve
• East Skokie Drainage
• Pension programs for Lake County, Highland Park, the Park District of Highland Park, the school districts, and the Forest Preserve

Now just because we are all in a situation where our home values are declining, does not mean that all of the above taxing bodies can operate with less money.  Our housing values have declined dramatically over the past 5 – 6 years.  Although there is pressure on all of these government organizations to tighten their belts and lower costs, at the end of the day, their budget cuts are not at the same rate as our declining home values – nor is there any reason for this to occur.  There is no relationship between home values and these budgets.  Similarly, when our home values were rising, the taxes didn’t necessarily increase at the same rates as our value.

The only reason that the tax assessor looks at our property values at all is so that they can determine each homeowner’s fair share of the total tax burden.  The actual value of the property, up or down, has no relation to the budgets for these taxing districts.  It is just a method that township assessors use, as specified by Illinois statute, to figure out each homeowner’s portion of the property tax “pie.”

Hope this is helpful. 

Thank you for reading!

Nancy S. Karp

 

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

Scorecard: market update for the North Shore Communities

After reading my recent series of posts providing an update on the North Shore real estate market, you may still be wondering how the various communities compare to one another.  So, here it is, the executive summary…

This is my personal ranking of the North Shore communities based on these factors within each suburb:

• Number of distressed properties that sold in the past 12 months (foreclosures and short sales)
• Number of properties currently in pre-foreclosure situation now versus 6 months ago.
• Number of bank-owned properties either on the market, or going on the market soon versus 6 months ago.

The communities at the top will see price recovery before the ones lower on the list….Skokie and Evanston at not looking good with an high and increasing levels of distressed properties.

1.Kenilworth

2.Winnetka

3. Glencoe

4. Lake Forest

5.  (4-way tie) Glenview, Northbrook, Northfield, and Riverwoods

9.  (3-way tie) Highland Park, Deerfield, and Wilmette

12. Evanston

13. Skokie

FYI, if you are ever interested in seeing information on recent sales in any suburb on the North Shore, you can find it by clicking here.  Then just click on the community of interest.

Thank you for reading!!  New topic next time, I promise.

Nancy S. Karp

 

To find any property for sale in the Chicago area, click here.

Market Update: Skokie, Winnetka and Wilmette

This is the 7th and FINAL article in a series I have written about the real estate market on Chicago's North Shore.  I have been using the concept of "shadow inventory" to understand how much longer home prices will be declining in each community on the North Shore.  Shadow inventory refers to homes that are in pre-foreclosure (the owners are 3 months or more behind on their payments) and homes that have already gone through the foreclosure process and are bank-owned.  Some of these homes may already be available for sale, but most of them are not.  When they do hit the market, it will be at discounted prices (as short sales or bank-owned properties) because of their distressed status.  When these types of properties are for sale, this causes prices of other properties in the area to decline.  So the fact that these properties are potentially going to hit the market in the coming months is NOT A GOOD THING.

Skokie

Shadow inventory increased by almost 20% over the past 6 months to 589 properties in Skokie.  Almost 27% of these are bank-owned properties. There are 430 households that are behind in their mortgage payments in Skokie – that represents 30% of the pre-foreclosures on the whole North Shore!  Skokie seems to be hit hardest of all the communities on the North Shore with distressed properties.

Skokie - 12 months ending 7.26.2011	Bank-owned properties Sold	Short Sales	Total distressed property sales
Total	126	74	200
% single family homes	59%	61%	60%
% condos/townhomes	41%	39%	40%

 

 

Skokie leads all of the other North Shore communities with 200 distressed property sales during the past 12 months.  These sales are just under 34% of the size of the current shadow inventory.  If these trends continue in Skokie it will definitely be the last suburb on the North Shore to see an end to falling prices.

Wilmette

Wilmette saw shadow inventory increase by 24% to 92 properties.  About 76% of these are in pre-foreclosure, and the rest are bank-owned.

Wilmette - 12 months ending 7.26.2011	Bank-owned properties Sold	Short Sales	Total distressed property sales
Total	12	10	22
% single family homes	75%	80%	77%
% condos/townhomes	25%	20%	23%

 

 

On top of the increase in the shadow inventory, only 22 distressed properties were sold in the past 12 months.   This is only 24% of the size of the shadow inventory.  This means that it will take some time for Wilmette to recover from falling prices because the number of distressed properties in the “pipeline” is increasing and sales of distressed properties is relatively low in comparison. 

Winnetka

Winnetka had a total of 6 bank owner properties and 14 homes in pre-foreclosure as of July 26, 2011, for a total shadow inventory of 20 homes.  This is a decrease from 39 homes in January 2011, a good sign of recovery.

Winnetka - 12 months ending 7.26.2011	Bank-owned properties Sold	Short Sales	Total distressed property sales
Total	6	8	14
% single family homes	100%	88%	93%
% condos/townhomes	0%	12%	7%

 

 

There were 14 distressed properties sold during the past 12 months in Winnetka, which is 70% of the size of the current shadow inventory.  The declining shadow inventory AND the relatively strong sales of distressed properties indicate that this community is close to turning the corner on pricing!!

 

Thank you for reading!!!

To find any property for sale in the Chicago area click here.

To look at recent sales and other sales statistics for your community click here and then click on the map to specify the community you want to see.

nsk

Nancy S. Karp

 
 
nancy@nancykarp.com

@properties | Consultant, MBA, ePro, SFR, CREN |   

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