Monthly ArchiveOctober 2010
October 26, 2010 - It probably comes as no surprise to anyome who follows Chicago real estate that September sales of existing Chicago condos and single-family homes experienced a double digit drop. According to a Tribune article that detailed the latest report from the Illinois Association of Realtors, sales of both Chicago area homes and condos plus in-town residences dropped significantly in September of this year. The median price also took a hit, dropping double digits as well.
Interestingly, total sales of in-town Chicago condos and single-family homes for the first nine months of 2010 were up 11.1% compared 2009 sales during the same period. Sales of Chicago area condos and Chicago homes were also up 10.5% for the first nine months of 2010 as compared to sales numbers from the same nine months of 2009.
September 2010 sales of Chicago area homes fell 22.4% as compared to September 2009 sales. There were 5,327 Chicago area condos and single-family homes sold this past September. The September 2010 median price of Chicago area condos and single-family homes also fell to $175,000 which was a 12.1% drop from the same month last year (2009).
In-town Chicago September 2010 sales of condos and single-family homes added up to 1,403 units, which was a 26.9% decline from September of last year (2009). The median September price of in-town Chicago condos and single-family homes dropped 20% from the same month last year coming in at $180,000.
To break things down a little further, the article went on to state that September 2010 in-town Chicago condo sales had a 28.6% free-fall as compared to the same month last year. September 2010 sales of single-family homes in-town Chicago fell 24.3% as compared to September 2009. The September 2010 median price of in-town Chicago condos dropped 11.5% to $240,000. The September 2010 median price for in-town single-family homes fell 10% to $135,000.
As long as there continues to be an overstock of Chicago condos for sale as well as no significant improvement in the unemployment rate, we can probably expect to see sale numbers and median prices decline for the rest of the year.
October 25, 2010 - If you’ve been waiting for prices to be cut at 50 East Chestnut, you may have a long wait in store even though sales are still only at 59% with almost three years after first deliveries. Prices on the remaining unsold condos at this tower run about $3.1 million. According to a recent Crain’s report, brothers Charles and Harry Huzenis, developers of this Gold Coast Chicago real estate project, have a $17 million loan from First Chicago Bank & Trust coming due on January 17th, 2011. So making sales soon is crucial, even though they are trying to get a 22 month extension on the loan.
There have been 20 closings so far at the 39 story high-rise, but that still leaves 14 of the Chicago condos unsold. The units occupy a full floor and have two terraces, and five of those units14 are built-out, the article states. Mr. Huzenis commented that those five may be a harder sell because many buyers perfer to pick out their own finishes.
Only one sale has closed in the past 12 months at 50 East Chestnut, although right now a buyer is close to signing on two units on floors 21 and 22. That sale would generate enough income to knock the loan balance down to $10 million, according to the article. So far condo sales have added up to $67 million, which is about 61% of Huzenis’ $110 million sales target.
For buyers in the market for Gold Coast Chicago condos, 50 East Chestnut may be a good investment or at least a good place to start looking.
October 21, 2010 - So far there is no sign of any price reductions on the remaining unsold developer units at Trump Tower since the lawsuits between Trump and the bank who holds his loans were settled last month. The Chicago real estate developer now has five more years to repay the $600 million in loans. So rather than lowering prices to lure buyers, Trump has decided to decorate five models and have them ready for touring before the year is over, according to a recent Tribune article.
“People are getting off the fence. The gives us the ability to tell the story of the success of the hotel, as well as what lifestyles we perceive for this building,” Ivanka Trump was quoted as saying in the article. There were 13 Chicago condos and one hotel condo unit that sold at Trump Tower from June to September of this year, according to Appraisal Research Counselors. But the article also states that one third of the condos in the high-rise are still unsold.
The developer-owned units are up against investors who continue to undercut them on pricing. Also, the Ritz-Carlton Residences will start making deliveries sometime next year. And Spire buyers who are now probably giving up hope might be in the market for another condo. All of these things prompted Trump to show off some model units.
The five models target certain types of potential buyers. They seem to be grouped by gender. One model is aimed at attracting more mature, conservative women. Another is decorated to appeal to single career women. Another model is furnished to suit wealthy single men. Then there is a condo model decorated with an eye to an “urban yet rustic lifestyle.” And one last model is furnished to fit a couple who have children or other family members who visit. That condo is on floor 34 and has 2,000 square feet and a $2 million price.
When these models open you can compare them to other Chicago luxury condos and see if they’re worth the price.