Chicago Real Estate

Will Chicago home prices fall?

Ken Smith — Wed, 23 Jul 2008 05:26:16 +0000

Are you trying to time the market to purchase at the bottom? If you aren’t there is a really good chance you know someone who is. The media spits out national housing statistics and it scares most people because they forget real estate is local.

What happens in California has little to do with our real estate market, yet what happens in California has a huge impact on the national statistics. The national housing statistics are about as useful as the national education statistics.

One company that keeps a very close eye on the housing market is PMI Mortgage Insurance Co. PMI Mortgage Insurance Co. releases a market risk index every quarter. This is an in depth report on the status of the real estate market as a whole and on a local level with 381 “MSA’s” (metropolitan statistical areas and divisions) tracked. The largest 50 are watched very closely and naturally Chicago metro is one of the largest areas tracked.

Chicago’s Real Estate Market Risk Index

With the background information out of the way it’s time to dive into the key numbers from the report and what they tell us about our real estate market.

The key number that PMI Mortgage Insurance Co. releases is a Risk Index Score. This score is the likelihood that prices will decrease over the next 2 years. If the index score is 100 then there is a 100% chance that the Metro area will see a price decrease over the next 2 years.

Chicago received a Risk Index Score of 1.5, or 1.5% chance of home prices falling over the next two years. This number is down from 2% in the 4th quarter of 2007. It is well below the average of the top 50 metro areas of 29.5%.

Chicago’s Real Estate Market Affordability Index

Another important number released in this report is the Affordability Index which measures how affordable a home is compared to 1995. This number takes into account home prices, incomes, and interest rates. A number above 100 means that homes are more affordable then in 1995 for the average household, a number below 100 means they are less affordable. Metro Chicago has an Affordability Index score of 101.89, this shows that our homeownership affordability is directly in line with 1995.

If you have been trying to time the market and are expecting home prices to continue to fall it might be time to make a move. This report shows even more evidence that the Chicagoland real estate market is at or is very near the bottom. Please keep in mind that this report only takes into account the average median prices for the whole Chicago metro market and that local markets can vary greatly by city, neighborhood, and even block. For information about your neighborhood and it’s current market conditions contact us and we will be happy to provide you with a market report.

Source: Economic Real Estate Trends Published by PMI Mortgage Insurance, Co. (PDF)

A day at the Track (Arlington Park)

Ken Smith — Tue, 15 Jul 2008 19:43:31 +0000

Arlington Park, or Arlington Racetrack, is a great place to spend an afternoon. A day out in the sun watching horse races is something I can remember doing as a kid with my parents. Now it’s something I enjoy doing with my family, we watch the horses, place a few small ($2) bets, and enjoy the relaxing day.

My daughter (right) is 2 1/2 years old and loves the horses. She hears the trumpet sound and we go running off to watch the horses come out onto the track. We then move over and get a spot at the finish line so we can get the perfect view of the horses at the end of the race. Then naturally we must move back and watch the horses as they make their way off the track. Her natural obsession with horses is amazing and highly entertaining.

The Track

Sometimes photos can say a thousand words, lets hope they can convey the atmosphere of Arlington Park.

Arlington Park Details

Some details you may need to know.

Arlington Park has races from Friday, May 2 through Sunday, September 21

Admission is $7 per adult and children are free

There are more expensive seating options, but in my opinion the free general admission seats are the best

Parking is free, or if you prefer not to have as far to walk there is “preferred” (paid) parking and valet parking

Food at the track

Be prepared for some expensive prices for the food at the track, that is be prepared by bringing a picnic lunch. Yes the track will allow you to bring in a small cooler with food. Basically if you purchase it at the grocery store you can bring it in, but don’t try to bring in commercially prepared food like a pizza or fast food. This can easily save you $15 a person as a burger, fries (or chips), and a drink will cost you at least this amount.

From the Track’s Website:

Small coolers containing unopened plastic bottled non-alcoholic beverages and individually wrapped food items. These coolers are only permitted in the picnic area to the east of the building or on the apron level outside the building. Coolers with outside food or beverages will not be permitted to be consumed inside our building or in our reserved seating areas.

Between being able to bring your own lunch, free parking, and children getting in for free this can be an inexpensive day out for the family.

You can find out details about the track including race schedules, pricing information and more at the Arlington Park website.

Arlington Heights Irish Fest - 2008

Ken Smith — Mon, 14 Jul 2008 17:56:12 +0000

The 9th Annual Arlington Heights Irish Fest is this weekend, Friday July 18th 6-11pm and Saturday July 19 4-11pm. With Irish dancing, best legs in a kilt contest, face painting, Irish food and drink, Irish music, and balloon creations there is something for all ages. (more…)

Inventory levels, what they mean

Ken Smith — Wed, 18 Jun 2008 22:37:50 +0000

Real estate markets are considered to be “normal” when there is 6 months worth of inventory. This is a number that most of the Chicagoland area hasn’t seen since May/June of 2006. With inventory numbers peaking last October-December at levels around 24 months for most areas. (more…)

Impact of Gas Prices on the Chicagoland Real Estate Market

Ken Smith — Mon, 09 Jun 2008 21:29:55 +0000

Who would have ever thought $4 per gallon of gas would be a thing of the past. We have been over $4 a gallon for regular gas long enough that most people have come to accept that it is more likely to become $5 per gallon before we see $4 again in Chicago. Even using 20 MPG that means it costs you $.20 per mile you drive just for gas costs. Worse we all know that 20MPG is more than most cars average while trying to fight rush hour and construction’s stop and go traffic. (more…)

Arlington Heights Market Update (5-20-08)

Ken Smith — Tue, 20 May 2008 17:46:05 +0000

Arlington Heights, along with most of the Chicagoland market, has seen a slowed real estate market. There is no question this is a “Buyers Market” and there are some amazing deals to be had.

From looking at the numbers we are seeing an increase in homes under contract and this may be a sign of the market starting to recover. A brief overview of the current market is below. (more…)

Chicago Transfer Stamp Price Increase

Ken Smith — Thu, 13 Mar 2008 20:58:43 +0000

Without debate the bill to increase the transfer tax in the City of Chicago won council approval by a 49-0 vote. The bill (which was introduced by Alderman Patrick O’Connor of the 40th district) adds $3 per thousand dollars of home value to the sellers side on top of the $1.50 they already pay for the state and Cook County. While this isn’t the highest amount a seller pays in the Chicagoland area, Chicago now has by far the highest combined fee of any city. (more…)

Arlington Heights Goodwill Store Opens

Ken Smith — Sun, 17 Feb 2008 23:04:57 +0000

Goodwill has opened a store in Arlington Heights. The location will be a store and donation center. Goodwill is always looking for used items that can be resold to help them raise money.

The store is located at 1551 N Dryden Avenue (Arlington Heights) which is the corner of Rand Road and Dryden Avenue. The phone number is 847-670-7311.

Goodwill provides training, employment and supportive services for people with disabilities or disadvantages who seek greater independence.

Lakeview Condo Building Electrical Fire

Ken Smith — Mon, 11 Feb 2008 18:00:01 +0000

Even with working through the weekend it looks like residents of 3930 N. Pine Grove Ave in Chicago will have to wait yet another day to return to their homes.

Residents have had to make other living arrangements due to electrical fire that reportedly started in the basement on Saturday. Currently it looks like a faulty electrical vault was the cause of the fire that has left hundreds of residents homeless. Nobody was seriously injured in the fire.

Residents can call for an update on the situation at (312) 565-6110

Getting Pre-Approved

Ken Smith — Fri, 25 Jan 2008 20:22:13 +0000

Buyers are in such a hurry to get in the car and look at houses that they forget about the first and second steps many times. In my opinion the very first step is interviewing a few agents, there will be more about this later. Once you have found a great agent to help with your home purchase then you need to find out how much home you can actually afford.

The Pre-Approval process is simple and painless these days. The most important part of this process is to work with a reputable local lender. The large internet lenders claim to be this and that, but the reality is they have fallen far short of the needs of home buyers. Worse Illinois has many regulations that out of state lenders never know about and this causes delays in closings or worse. So now the question becomes what local loan person should you work with? (more…)