Sue Fox, @Properties. Direct 773.816.1788

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Autumn in Chicago: Sales plunge and foreclosures rise

filed under: Buyers, Chicago home prices, Chicago home sales, Developments, Foreclosures, Market conditions, Short sales, South Loop posted on November 1st, 2010

HEADED SOUTH IN THE SOUTH LOOP: Many of the South Loop's newer condo projects

HEADED SOUTH IN THE SOUTH LOOP: Many of the South Loop's newer condo projects, like this one at 1620 S. Michigan, have been battered by foreclosures and short sales. Recent data show 12 foreclosure filings here in the last three months ... but only one sale, a 2-bedroom on the sixth floor that was a short sale, closing in September for $175,000.

Chicago’s real estate market continues to gasp and wheeze this autumn, with the Illinois Association of Realtors reporting that homes sales fell 27% in September compared to the previous year. The city’s median price dropped like a stone as well, falling 20% — from $225,000 a year ago to $180,000 this September.

However, if you look at the entire year, things are a bit brighter. Thanks largely to the now-expired federal tax credit for home buyers, Chicago’s year-to-date sales jumped 11% during January through September 2010, compared to the same period in 2009. The year-to-date median home price fell 8%.

Looking ahead to the always-slow winter season, I would say that qualified buyers have a great opportunity to buy a home at both a stellar price and interest rate … but everyone else (sellers and existing homeowners) is in for a long, chilly slog towards spring.

The number of foreclosed homes, meanwhile, is soaring in Chicago. In fact, the Chicago metro region recently ranked third in the nation for foreclosures, with more than 12,000 foreclosed homes in the third quarter of 2010, behind only Phoenix and Miami. The Chicago area’s foreclosure activity jumped 35% in the third quarter, according to RealtyTrac, a company that tracks distressed properties.

Some of Chicago’s more affluent neighborhoods — like the Loop, West Loop, South Loop and Lincoln Park — have also seen large increases in foreclosures. In the Loop, for instance, there have been 205 foreclosure filings during the first nine months of the year, a 77% increase over the same period in 2009, according to data compiled by the Woodstock Institute, a non-profit research group based in Chicago.

The troubled buildings in the Loop include River City at 800 S. Wells, where there were 16 new foreclosure filings in the last three months; Century Tower at 182 W. Lake St. (nine foreclosure filings); Park Millennium at 222 N. Columbus Drive (six), according to the Woodstock Institute. In the South Loop, where many of the newer condo buildings have ended up filled with renters, a handful of buildings had two-thirds of the recent foreclosure filings: 1620 South Michigan Ave. (twelve); Vision on State at 1255 S. State St. (eleven); and 1720 South Michigan Ave. (eight).

Written by Sue Fox //

  1. Pete

    The numbers given in this post do not seem to bode well for the immediate future of chicago investment property. With sales down and foreclosures up, then data for rent and vacancies may be expected to trend unfavorably with Q4 approaching. Q3 data given by ReisReports actually shows a positive trend in the apartment market, which contradicts this. Since Q2, rent has seen a 0.4% growth. Additionally, the vacancy rate dipped sixty basis points (from its YTD figure. of 640 basis points) down to 590 basis points.

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