Chicago Condo Directory

June 11, 2009 - According to the National Association of Realtors, in the first quarter of 2009, 50% of all home sales were distressed homes (short sales and foreclosures). First time buyers also made up 50% of the total sales in the first quarter. These first time home buyers are actually the reason many experts are predicting a real estate recovery sooner as opposed to later. And the widely advertised $8,000 tax credit is another incentive to first time buyers.

But even with some increased sales activity, Appraisal Research Counselors found that downtown Chicago condo sales are down by more than 65% from 2005 when almost 4,400 units were sold. A recent article in REJournals also stated that there are about 4,700 unsold units in the Chicago real estate market. They are predicting that those unsold condos and townhomes will be under contract within the next three years partly due to the fact that developers are planning no big projects in the near future.

Another potential factor that could kick start the housing market is if Chicago is selected to host the 2016 Olympics. In fact, even Chicago Spire developer Shelbourne has hinted at that event possibly being a catalyst for finally getting that high-rise off the ground.

And another prediction the article made was that “green” construction would still be popular among future buyers. Younger buyers are often more aware of eco-friendly practices and are apt to be inclined to purchase homes with more eco-friendly and energy efficient features, especially as they become more affordable in the future.

But until this housing market revival takes place, there are still plenty of Downtown Chicago Condos ready and waiting for you.

Technorati Tags: Chicago Spire, Downtown Chicago Condos, Chicago Real Estate

February 24, 2009 - Apparently now is the time to rent, especially if you want a Chicago condo or apartment in the South Loop. According to the latest numbers gathered by Appraisal Research Counselors, rents for downtown apartments fell to their lowest rates since 2001. Rents are averaging about $2.11 per square foot in the last quarter of 2008. That is down 6.2% from the same period in 2007. ARC noted that this is the first time rents have fallen since 2003.

The main culprits in the decline are of course the worsening economy and influx of some 3,200 new condos from 2008 and this year as well. With fewer jobs there is less demand for apartments, and according to Crain’s there will be a loss of 133,000 jobs in Chicago this year. Also, there were 1,016 new apartments added to the South Loop in 2008, with more developers turning to rental Chicago real estate projects instead of condos. Developers and often investors will opt to rent out a condo when it doesn’t sell in an attempt to buy some time until the market improves.

This so-called shadow market of condo rentals is putting more pressure on Chicago apartment managers. Many try offering one or two months rent free in an effort to keep from lowering rent prices on units. The Crain’s article mentioned one apartment building in particular that is having a difficult time finding tenants. 1401 South State Street is a luxury apartment high-rise that so far has only leased about 60% of its 278 units during the 10 months it has been open for occupancy. Appraisal Research Counselors stated that in a normal market, a quality apartment building would be around 90% full.

For those who aren’t ready or able to buy one of the New Chicago Condos for sale right now, it might pay to check for any units in the building that may be for rent. You could find a deal where you might not expect it.

Technorati Tags: Chicago Apartments, Chicago Condos, Chicago Real Estate

February 18, 2009 - The latest news for Chicago real estate developers isn’t exactly encouraging, especially for those who have condo projects with unsold inventory. According to a recent article in Crain’s, downtown Chicago condo developers were hit with a net loss of 253 sales in the last quarter of 2008. Appraisal Research Counselors reported that it was the worst quarter for downtown condo developers since the early 1990s.

This negative sales number is the result of an increasing amount of pre-construction buyers who are now deciding it is better to give up their deposits than follow through with a contract when the unit may be worth less now than they agreed to pay for it a few years ago. Some buyers are also unable to get a loan when closing time comes and have no other alternative but to break the deal. Those buyers who were planning on a fast resell on their condos to make a profit are most likely to default on their contract.

The actual number of downtown condos sold last year is only 592, according to ARC. That is 84% less than the 3,724 condos that were sold in 2007. ARC stated that this is the third year of declining sales since the market topped out in 2005 at 8,162 condos sold.

A total of 4,734 downtown condos will be completed in 2009 and 42% of those are still not sold. The areas showing the highest glut of inventory are the West and South Loop. ACR estimates that only 620 condos will be completed in 2010 and a paltry 86 in 2011. With no major developments in the pipeline and demand for units still at record lows, it could be another two or three years before we see large scale New Construction Chicago Condos being built again.

Technorati Tags: Downtown Chicago Condos, Chicago Real Estate, New Construction Chicago Condos