If you have ever rented or try to rent real estate in Chicago, you have seen first-hand how rental rates have increased. Pricing many, wishing to rent property, out of desirable neighborhoods. What you may not be familiar with is the 1997 Illinois state law, prohibiting rent control in the state, has allowed landlords to significantly raise rental prices and create “rent-burdened” residents.
However, changes to this law could be considered soon. If a recent advisory referendum vote is an accurate indicator of how most Chicago residents feel about rent control, ending the ban on rent control will be welcome by Chicagoans.
According to an article published by Crain’s Chicago Business, written by Dennis Rodkin, the advisory referendum was placed on almost 80 precincts’ ballots. The result was that in each of the 76 precincts, “at least 60 percent of the votes cast were in favor of lifting the ban, and in most the figure was above 75 percent.” Its seems that lifting the ban is widely supported. Only time will tell if change to this ban will come as a result.
Read the entire article.
The debate over why households choose renting over purchasing a home in the United States has been a hot topic lately. Analysts have indicated the young generation of millennials are not interested in being tied down to home ownership and prefer renting over buying. However, an article published by CNN by Daniel B. Kline, points out that it is not just millennials who are opting to rent instead of making a home purchase. Kline also notes that the decision to rent may not be a lifestyle choice, but a financially driven decision.
It is true that the number of households renting a home has increased over the past decade; almost by 10 million. It is also true that 65 percent of household headed by those 35 years old and younger rent their homes. However, it’s the heads of households aged 35-44 that made the biggest increase over the past decade. In this age group, “the percentage of renters jumped from 31% in 2006 to 41% in 2016”. Heads of households between 45-65 renting homes also increased over the past decade.
However, these households may not all be renting based on lifestyle choices. In fact, research indicates that many who rent homes would actually like to purchase a home someday. Further, surveys show that 65% of renters indicated that they are renting homes due to circumstances, not purely by choice. Circumstances such as increased home prices and tougher mortgage standards may be partially to blame.
Read the entire article.
Photo Credit: Mark Moz
Each year home owners receive a new property tax bill and have the opportunity to see what value their county assessor’s office has assigned to their property. The property value on tax bills should be an accurate representation of the home’s true market value. However, residents of Cook County, according to the Chicago Tribune, are not receiving accurate property values. Sadly, inaccurate valuations are negatively impacting many home owners in lower income communities. Worse yet, it seems as though wealthy home owners are benefiting from their properties being undervalued by the assessor’s office.
After analyzing millions of property tax records over a period of 12 tax cycles, the Chicago Tribune determined, “Residential assessments have been so far off the mark for so many years that the credibility of the entire property tax system is in doubt.” Despite his announcement in 2015 that his office would be using new technology and models to improve the accuracy of property valuations, Cook County Assessor Joseph Berrios continued to utilize old computer models were still until at least 2015.
A detailed breakdown of the property values, according to their geographic locations, shows that homeowners in some of Cook County’s most affluent neighborhoods are receiving tax bills based on properties that are undervalued by 10 percent or more. “Meanwhile, home owners in poorer areas of Cook County have properties significantly overvalued by the county. As a result, people living in poorer areas tended to pay more in taxes as a percentage of their home’s value than residents in more affluent communities,” says Jason Grotto from the Chicago Tribune.
Want to fight your valuation and reduce your real estate tax bill? Contact our office for a free review of your property.
Read the entire article published by the Chicago tribune.
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Some promising real estate sales information for Chicago and its surrounding suburb’s was released by Crain’s recently. The analysis included the actual number of homes sold, the median price of the homes that sold and the average time to sell compared to those same statistics from quarter one of 2016.
Rising to the top of the list for single family homes sold in Chicago was the Irving Park neighborhood. According to the article in Crain’s, written by Dennis Rodkin, “Irving Park’s volume of sales is up 6.6 percent, to 66 sales, and the median price sale price rose 8.6 percent, to $505,000. Houses sold 14 percent faster than a year ago, in an average of 102 days.”
Suburbs such as Glendale Heights, Oak Lawn and Joliet reported impressive increase in homes sales, significant rise in median price and a marked decrease in the time the homes spent on the market before receiving an offer. Specifically, Glendale Heights’ sales increased 4.8 percent and the median price rose 9.4 percent compared to the first quarter of 2016.
Read the entire article to see sales data for other Chicago neighborhoods and suburbs showing growth and improvement from last year.
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A number of first time home buyers are ready to enter the real estate market. Young professionals who are looking to purchase their first home might find it appealing to own a property in one of the many Chicago neighborhoods; however, the prices for a single family home are too steep. Purchasing a condo is an attractive alternative; in fact, owning a condo can be very appealing to many home buyers who want to move into one of these hot areas but also don’t want to take on the maintenance single family home.
Nevertheless, purchasing a condo in Chicago can offer its own set of issues if not researched thoroughly by the buyer. An article published by Alex Mayster in U.S. News Real Estate offers many considerations buyers should remember when purchasing a condo in the city.
For example, Mayster encourages the buyer to find out how many units in the building are rented out currently. “If it’s over 50 percent rented, you could have trouble getting a loan,” says Jennifer Mills Klatt with the Berkshire Hathaway HomeServices KoenigRubloff Realty Group. Even if the buyer is able to secure a loan, home owners in a building with more than 50 percent of the properties rented out may find that their neighbors don’t share the same level of financial investment in the property. This could also lead to frustration when owners renting their property vote to spend to less money on improvements and maintenance. A high percentage of rental units may also affect the resale value of the property.
The article goes on to provide other helpful tips for condo buyers such as researching and exploring the neighborhood first-hand, personally investigating the availability of parking, whether it be street parking or an included parking spot, and researching the condo association minutes and assessments.
Read the entire article.
Photo Credit: Gregory Richard
The real estate market is showing signs of improvement; as a result, more Americans may be entertaining the idea of purchasing a home for the first time or moving to a new area of the U.S. However, its wise to consider how much money you need to earn in order to afford a home in a specific city. A recent study released by HSH.com provides the details about 27 major U.S. cities and what salary is required in order to purchase a home there.
According to an article published by Realtor.com’s Catey Hill, the study “assumes the buyer has good to excellent credit (and thus would get a mortgage interest rate—depending on location—of around 4%), put down 20% and would be spending no more than 28% of income on principal and interest.” Even with a significant down payment and a low mortgage rate, one would need to earn an average salary of almost $58,000 per year to afford a home in Chicago, according to the study results.
Topping the list with a salary requirement of almost $148,000 a year, is San Fransiciso, CA. More affordable cities such as Cincinnati, Atlanta and Pittsburgh allow home buyers earning closer to $30,000 to purchase a home.
To find out about other U.S. cities and how much you would need to earn to purchase a home there, read the entire article.