North Shore Views
Archive for the 'Real estate' Category
I find that people always seem to want real estate data on the most granular level they can get it. In particular, people want to know about the schools and how they compare, not only academically, but also in terms of home values. So I prepared this chart showing how Wilmette’s home sales break down by elementary school. Central School, being the biggest of the four schools, naturally has the most sales and the most active listings. It’s also the most expensive part of town, with the highest median sale price.
Home Sales by Elementary School District: January – September 2010
I took my daughter to her hockey game the other day at North Shore Ice Arena and had some extra time while the kids were getting their pre-game pep talk in the locker room, so I wandered across the street to check out Meadow Ridge, a new community of 164 townhomes and duplexes being built in Northbrook. It’s just off of Techny Rd., and across from Techny Towers (which you can see in the background of the photo above). I was able to walk through the model and chat with Shannon Gibson-Giampa, one of the sales reps for the development. Here’s what I learned:
There are six different floor plans ranging in size from 2,236 to 2,662 square feet of living space; each has another 285 to 555 square feet of bonus space that can be finished as an office, exercise, storage or media room. Five of the floor plans have three bedrooms and two and a half baths. The sixth has two bedrooms and two and a half baths. Prices range from $495,000 to $895,000. Monthly assessments are $500 – $600.
Meadow Ridge is being built by KZF Development, the same company that built Royal Ridge, a gated community of luxury homes and townhomes on the other side of Waukegan Rd. It’s just north of Willow Festival, so there’s plenty of shopping and dining nearby.
I learned another interesting thing about Meadow Ridge. Like Royal Ridge, it is offered under an alternative form of ownership known as “land lease” or “ground lease”, which means that the land on which it is built is leased, not sold outright to the home buyer. Royal Ridge was the first such arrangement on the North Shore but apparently it’s pretty common in other states and countries. (I think most or all of London works this way). In this case, the land is owned by the Society of the Divine Word and leased for 150 years. Supposedly, the benefit of this to the home buyer is that the home is more affordable. Your initial purchase price will be less than it would be for a comparable residence in which the land is included. Otherwise, it’s pretty much like owning any other home when it comes to mortgage, taxes, insurance and sale, subject to the 150-year ground lease.
Year to date home sales were up 37% on Chicago’s North Shore. The median sales price also increased by 3% overall and days on market for homes sold declined 6% to 200 days.
All nine towns showed sales increases for the nine month period, with Lake Forest having the largest gain, at +59%. Glencoe showed the smallest increase at +3%.
Five communities enjoyed increases in the median price of homes sold, while four suffered declines. Northfield experienced the biggest drop at -34%.
Market time declined for all but three communities: Kenilworth, Northfield and Highland Park.
What does all this mean? Well, for one thing, that the market is stabilizing. Houses are selling. Prices seem to have reached bottom. Does that mean that prices will start climbing back to where we were during the height of the market? Sadly, no. Prices will most likely stay at current levels (maybe improve slightly) for several months. Maybe longer. It will be several years before we see the prices we reached during the boom.
North Shore Home Sales Data: January – September 2010 vs. Year Ago
Source: MRED- Data for single family detached homes. Deemed reliable but not guaranteed
Zillow just published its annual “10 Most Expensive Homes for Sale” list so I thought it would be fun to do my own list of the 10 most expensive homes for sale on Chicago’s North Shore. While we can’t compete with the Spelling mansion, which, at a jaw-dropping $150,000,000, holds the top honors on Zillow’s list, we do have some pretty impressive properties right here in our own backyard.
The homes that are currently on the North Shore “top ten” list range in price from $7,900,000 to $28,000,000. One is in Evanston, two are in Winnetka, two are in Highland Park and five are in Lake Forest. Seven of them are lake front properties and all but three were built before 1930. And, assuming you can afford the price tag to buy one of these beauties, be prepared to cough up another $30,000-132,000 a year in property taxes.
1. Modern Chateau
For Sale: $28,000,000
I watched this one go up and it took over two years to build. Designed by Richard Landry, this French chateau style mansion is situated on two acres inside a walled enclave. It’s not on the lake but it has pretty much everything else you could want including 26 rooms, a 9-car garage, pool and exquisite finishes throughout. Architect Richard Landry is known as “Architect to the Stars” and also designed the homes of Rod Stewart, Wayne Gretzky, Tom Brady, and Eddie Murphy, among others.
2. The Schweppe Estate
Location: Lake Forest
For Sale: $15,000,000
This gorgeous 27 room manor was built in 1917 and completely restored in the 1980′s by 70 craftsmen from around the U.S. and Europe. The estate’s claim to fame is that it once hosted the Duke and Duchess of Windsor and the heirs to the crown of Sweden.
Location: Lake Forest
For Sale: $11,500,000
This 5.4 acre lakefront estate was designed by Howard Van Doren Shaw and built in 1927. It has beautiful gardens and grounds and claims to have the best beach in Lake Forest.
If you are confused about the future of the U.S. housing market, you’ve got plenty of company. And I think we have the media to blame for that.
One day the headlines say things are getting better. The next day it’s all doom and gloom again. This has been going on for months now, especially since the end of the tax credit. Every time a new piece of economic data is released everyone wants to be first with their predictions about what it means. The economists, whom we rely on to bring some rational thought and analysis to the table, are as bad as the media. Rather than bringing clarity they are adding to the muddle. And all this confusion has potential home buyers running for the hills.
The fact is, no one (including the economists) has a clue what’s going to happen with the housing market in the short term. Any more than they can predict what the stock market will do.
So, I found it refreshing to see Brett Arends’ article in the Wall Street Journal in response to Time’s September 6 cover story “Rethinking Home Ownership”. While acknowledging the issues plaguing the current market, Arends cuts through the confusion and delivers the bottom line: that there are as many (if not more) reasons to buy a home now as ever:
- You can get a good deal
- Mortgages are cheap
- You will save on your taxes
- It’ll be yours
- You’ll get a better home
- It offers some inflation protection
- It’s risk capital
- It’s forced savings
- There’s a lot to choose from
- Sooner or later, the market will clear
In real estate parlance absorption rate is a measure of how long it will take for all the homes that are on the market to sell (or be absorbed) at the current rate of sale. This can either be stated as a percentage, meaning what percent of homes are being sold (or absorbed) by the market every month; or it can be stated as months supply, meaning how many months will it take to sell all the homes currently listed.
Absorption rate is calculated by dividing the number of sales in the previous month by the number of homes on the market at the end of the month. In a balanced market (meaning neither a buyer’s market nor a seller’s market) the absorption rate would be 15-18%. Lower than that means it’s a buyer’s market. To calculate months supply, divide the number of listings by the number of sales in the previous month. Six months supply is considered a balanced market. Less than six months supply is a seller’s market. More is a buyer’s market. During the recent housing market meltdown some markets had as much as 48 months of inventory.
On the North Shore of Chicago absorption rates have improved considerably in the last year. In August of 2009 the absorption rate for the North Shore overall was 8% and the months supply was almost 13. This August the absorption rate was 11% and the months supply was 8.8.
The individual towns with the largest improvement in absorption rate were Evanston, Wilmette and Winnetka. At least for the time being these towns have reached a balance between supply and demand. Mind you, that may not be true (and isn’t) for all price ranges. In some cases there is still an over-supply of homes (especially at the higher price points) and in some cases we are actually experiencing a situation where there is more demand than supply.
Home sales on Chicago’s North Shore rose 24% in August vs. a year ago. The median price for detached single family homes also increased 8%, to $677,500. Time on market decreased 25% to 152 days. All towns except Kenilworth and Highland Park experienced sales increases, with Lake Forest and Winnetka showing the most dramatic gains. Evanston, Wilmette, Glenview and Glencoe had healthy increases in median sale price.
North Shore Market Update – August 2010
Dear Mr. and Mrs. Seller-
My clients wanted to buy your house. They really did. Or at least they thought they did based on the description and pictures they saw on the MLS. Unfortunately, we couldn’t get in to see the house in person due to your “24 hour notice required – NO EXCEPTIONS” showing instructions. So now they have left town again, having put in an offer on another house that they liked almost as much as yours.
You see, my buyers are relocating to the North Shore from another state for a new job, and they only had this weekend to figure out where they wanted to live and find a house to buy. Once we’d done our area tour and they had identified two or three North Shore communities to focus on, I went about setting up appointments for later that day. When I called about your house, the appointment desk told me we could not see your house because of your showing instructions. When I explained about my out-of-town buyers, he said he was very sorry, but no.
Believe me, I understand how stressful it is to have your life disrupted by people traipsing through your home at the drop of a hat. And I know how difficult it is to keep your house in showing condition at all times, especially when time on market drags on and on. It is certainly your prerogative to decide when and under what conditions to show your home. However, I noticed that your home has been on the market for 97 days and has had one price reduction already, so I respectfully suggest that, if you really want to sell your house, you may want to consider being more flexible with showings.
The more accessible you can make your home to potential buyers, the more quickly you are likely to get an offer. And the faster you get the house under contract (the data shows) the more money you will get for your home.
Mr. and Mrs. Seller, I had a qualified and highly motivated buyer who, in all likelihood, would have made an strong offer on your house this weekend. But once you said no to a showing, you lost them. They won’t come back at a more convenient (for you) time.
Please, for your own sake, try to be more flexible the next time someone wants to see your home. You may just get an offer.
If you are planning to sell your North Shore home, you should read this article in the Wall Street Journal.
The article cites data from discount real estate broker, Redfin, which underscores how crucial it is to price your home correctly right out of the gate, rather than “testing” the market at a higher price for a few weeks. According to Redfin, new listings get 4 times as many online visits in the first week as they do a month later, which is when most people consider taking their first price reduction. Over 90% of home buyers begin their search online, so you don’t want to risk “missing the market” by overpricing your home.
If you are considering selling and would like to know what your house is worth in today’s market, I would be happy to provide you with a complimentary CMA (competitive market analysis). Give me a call at 847-687-5957 or email me. You can also get a quick, over-the-net home value analysis here.
The Illinois Association of Realtors announced today that residential real estate sales in the nine county Chicago area fell for the first time in a year for the month of July (single family homes and condos). This was driven by the end of the tax credit (June 30), the weak job market and the uncertainty around the economic recovery.
While sales declines for the North Shore are comparable to the greater Chicago area (-19.1% vs. July 2009), the picture is not as bleak if you look only at single family detached homes, which decreased only 11% in July. The good news for the North Shore market is that the median price is up 21% for all single family homes and up 8% for detached single family homes.
Here’s how the trends compare:
Home Sales -29.7%
Median Price -4.3%
Home Sales -25.0%
Median Price -9.6%
City of Chicago
Home Sales -19.5%
Median Price -19.8%
Home Sales -19.1%
Median Price +21.0%
*Evanston, Wilmette, Winnetka, Northfield, Kenilworth, Glencoe, Glenview, Highland Park, Lake Forest