Karp Real Estate

REPOST from the KCM Blog - Short Sale Advice

Below is an article that talks about some behind-the-scenes info in the short-sale world.  I am still coming across many short sales in the market right now, so this is terrific article.  Even though the market is stronger than it has been in a very long time, prices are still below the highs we saw and many people are under water on their mortgages...hence many sellers are faced with short sale situation.  This is repost from the KCM Blog.  Thanks for reading - nsk

 

Short Sale Question: Who Owns the Loan?

Posted: 29 Apr 2013 04:00 AM PDT 

The short sale process can be very complex. Every bank and investor has a slightly different program and set of guidelines they follow. Since each investor has different rules and guidelines, it can help you considerably to find out who the investor is before starting the process.

Whether you are a homeowner in need of help with a short sale or an agent trying to help a homeowner, one of the best things you can do is to understand the situation you are getting into.
A key piece of this short sale puzzle is finding out who actually “owns” the loan not just who services the loan.

Understanding the Back-end Process

To understand short sales, you need a basic knowledge of the back-end process of the mortgage market.  A few years ago, when the market was booming, mortgages would be originated by a
servicer such as Wells Fargo and then sold between the big mortgage investors like Fannie Mae and Freddie Mac. Today, in most cases, you are dealing with a servicer like Wells Fargo or Bank of America that “service” the loan but do not actually own the loan. The bank who originally lent the money is unlikely to still own it unless it is a small community or regional bank. In fact, Bank of
America and Wells, the two biggest servicers, only own about 8-10% of their portfolio. The rest of their inventory is made up of loans they service for other investors. The investor guidelines ultimately determine whether to provide relocation money on the short sale, if there will be a debt release on the sale and also define a slew of other details.

How to Find Out Who Owns Your Loan

1.) First, you can look on your mortgage statement. If the loan is FHA backed it will have an FHA MI line-item on your statement that usually says” FHA insurance”. You can also look at your original Deed of Trust, as it will have your FHA case number on it. If you want to see if your property is owned by Fannie Mae or Freddie Mac, you can also find it directly under the loan look-up tools available on their websites. Here are the links:

Fannie Mae 
Freddie Mac

2.) If your loan is not owned by one of these three entities you can ask the servicer of the loan who owns it – though they will not always tell you verbally. You could also research it by getting the title pulled. Chain of title will not always be conclusive either. However, in many cases, it has helped make it easier to “track” down the investor.  In some cases, it could also be owned by the servicer; Wells Fargo could be the servicer and also the investor on the loan. This is called a “portfolio” loan. You can also request for your servicer to disclose in writing who the investor is if they will not verbally disclose that information. This is called a “qualified written request, or QWR”.  On its website, the U.S. Department of Urban Housing and Development (HUD) provides a sample QWR and gives a brief explanation of this process.

3.) Another way to find out who owns your loan is through the Mortgage Electronic Registration System, Inc. (MERS). MERS is a company that was created by the mortgage banking industry. It maintains a database that tracks mortgages for its members as they are transferred from bank to
bank. You can look up a loan to see if they have the investor information here.  

Different Guidelines Used by Different Investors

The three biggest mortgage investors in the country are Fannie Mae, Freddie Mac, and FHA. VA is another big investor but does not have a portfolio nearly as big as the other three mentioned. With the exception of FHA/VA (because they insure their own loans), there also could be a mortgage insurer who provided insurance on the loan. The reason this is important to understand is that, when there is a servicer, investor and mortgage insurer on the loan, all three of them have to agree to the terms of the short sale. It is very important to find out from the very beginning of the process the identity of the actual end-investor on the loan. An FHA-backed mortgage has a totally different process for a short sale compared to a Fannie Mae loan.

Every investor has a different set of guidelines they set for short sales and foreclosure procedures so you have to understand that ultimately it is up to the end investor-not the servicer. The servicer has their own guidelines but they do not make the final decision. It is important that you know who the investor is because there will be times when you may have an issue with a servicer and you have to go to the investor to get it resolved.

There have been many transactions where the servicer and I disagreed on a particular issue and I went to the investor and got the approval.  So make sure going in to this situation you know everyone involved and go to the servicer’s and the investor’s website to get familiar with their guidelines and any specific documents they may require.

Attention Agents:

On your third party authorization letter (the letter that gives you permission to speak to the bank
on the homeowners’ behalf) always put the investor as well as the servicer so that if later you have to reach out to the investor you already have permission from the seller to do so. This also puts the servicer on alert that you know what you are doing and have already researched finding out who the end-investor is.

Short Sales – 10 Common Myths Busted" and more

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This is a re-post from my favorite real estate blog, KCM.  Terrific info on short sales.

nsk 

Posted: 06 Feb 2013 04:00 AM   PST It’s likely you’ve heard the term  “short sale” thrown around quite a bit. What exactly is a short sale? A short sale is when a bank  agrees to accept less than the total amount owed on a mortgage to avoid having to foreclose on the property. This is not a new practice; banks have   been doing short sales for years. Only recently, due to the current state of the housing market and economy, has this process become a part of the public consciousness. To be eligible for a short   sale you first have to qualify! To qualify for a short sale:   -your house must be  worth less than you owe on it. - You must be able to prove that you are the victim of a true financial hardship, such as a   decrease in wages, job loss, or medical condition that has altered your   ability to make the same income as when the loan was originated. Divorce,   estate situations, etc… also qualify. There are some exceptions to hardship   now, but for the most part the bank or investor will need to verify some type   of hardship. Now that you have a basic   understanding of what a short sale is, there are some huge misconceptions   when it comes to a short sale vs. a foreclosure. We take the most common   myths surrounding both short sales and foreclosures and give a brief   explanation. LET’S BUST SOME MYTHS!! 1.) If you let your home go to foreclosure you are done with   the situation and you can walk away with a clean slate. The reality is that this couldn’t be any farther from the   truth in most situations. You could end up with an IRS tax liability and   still owing the bank money. Let me explain. Please keep in mind that if your   property does go into foreclosure you may be liable for the difference of   what is owed on the property versus what is sells for at auction, in the form   of a deficiency balance! Please note this is state specific and in most   states you will be liable for the shortfall, but in some states the bank may   not always be able to pursue the debt. Check your state law as it varies   widely from state to state. Here is an example of how a   deficiency balance works: If you owe $200,000 on the   property and it sells at auction for $150,000, you could be liable for the   $50,000 difference if your state law allows it. Not only could you be liable   for the difference to the bank, but in some situations you could also be   liable to the IRS! Although there are exemptions (mostly for principle   residences) under the Mortgage Debt Forgiveness Act, there are times when you   could be taxed on both a short sale and a foreclosure, even in a principle   residence situation. Since the tax code on this is a little complicated and I   am not a CPA, I advise always talking to a CPA when in this situation as you   are weighing your options. Banks and the IRS can go as far as attaching your   wages. Not to mention if you let your home go to foreclosure you will have   that on your credit, as well. Guess What? A short sale   can alleviate your liability to the bank, in most situations. There are also   exceptions to this, but in most cases banks are releasing homeowners from the   deficiency balance on a short sale. 2.) There are no options   to avoid foreclosure. Now more than ever, there   are options to avoid foreclosure. Besides a short sale, loan modifications   along with deed in lieu are also examples of the many options. In most cases   (but not all) a short sale is the best option. Either way, there are more   options today than there have ever been to avoid foreclosure. 3.) Banks do not want to   participate in a short sale, or, it is too hard to qualify for a short sale. Banks would rather perform a short sale than a foreclosure any   day. A foreclosure takes a long time and creates a huge expense for the   banks; a short sale saves both time and money. In working with some of the   biggest lenders and servicers in the country they have told me that on   average they net 17-25% more on a short sale than on a foreclosure. A   testament to this is the financial incentives now being offered by banks, and   how much the entire process has recently changed to try and streamline the   process for all parties. Banks more than ever welcome short sales. Qualifying   for a short sale is easier than you think, you need to have a true financial   hardship, or a change in your finances and your house has to be worth less   than what you owe on it. Not only do consumers, but banks also now have   government incentives to participate in short sales. 4.) Short sales are not   that common. At this present time, short   sales range from 10-50 % of sales in various markets and it is predicted that   in 2013 we will have more short sales than any other year, to date.  One   of the biggest reasons is that MHA(Making Home Affordable expires December   2013). Many of the Government incentives like HAFA, will expire the end of   this year. Due to economic changes in the last few years, this is something   that is affecting millions of Americans. Short sales are in every market, and   are not just limited to any particular income class. This has affected   everyone from all facets of life. A short sale should be looked at as a   helpful tool, not a negative stigma.That is why the government is offering   programs that actually pay consumers to participate in short sales. It is not   just affecting one community; it is affecting communities and consumers   across the nation. 5.) The short sale process   is too difficult and they often get denied. Though the short sale process is time consuming; it is not as   difficult as the media would have you believe. The problem is that most short   sales are denied because of a misunderstanding of the process. It is true   that if the short sale process is not followed correctly there is a good   chance of getting denied. An experienced agent knows how to avoid this. Short   sales require a lot of experience, and a special skill set. If you are   looking to go the option of a short sale make sure your agent is skilled and   experienced in this area. 6.) Short sales will cost   me money out of pocket. A short sale should not   cost you any out of pocket money. In fact, you could get between $3000-up to   $30,000 to participate in a short sale. In many ways, a short sale may put   you in a better financial position than prior to the short sale. Almost every   short sale program now has some type of financial incentive for the home   owner, as long as it is a principle residence, and we are even seeing   relocation money being paid on some investment/second homes. As a seller of a   property you should never have to pay for any short sale cost upfront to any   professional service. Realtors charge a commission that is paid for by the   bank. In most communities there are also non-profits and HUD counselors who   can help you with foreclosure prevention options for free. The only potential   cost you could incur is if the bank would not release you from a deficiency   balance in the short sale, which is happening less and less now. 7.) If I am behind on my   payments, I can perform a short sale any time. The farther you get behind on your payments, the harder it is to   get a short sale approved. The closer a property gets to a foreclosure the   harder it is to convince the bank to perform a short sale. As they get closer   to a foreclosure sale more money is spent, thus deterring them from doing a   short sale. If you think you need to perform a short sale, time is of the   essence; the sooner you start the process, the better. Waiting too long can   trigger the ramifications of a foreclosure, losing the ability to do a short   sale as a viable option. 8.) I have already been   sent a foreclosure notice so I can’t perform a short sale. For the most part just because you received a foreclosure notice   or notice of default it does not mean that you do not have time to perform a   short sale. The timeline and specifics do vary from state to state, but   having done short sales all over the country, I have seen banks postpone a   foreclosure to work a short sale option as close as 30 days prior to the   scheduled foreclosure auction, but the longer you wait the less chance you   have. If you have received a legal foreclosure notice, please reach out to a   professional right away. The longer you wait, and the closer you get to   foreclosure, the fewer options you have. If you have received a notice to   foreclose this means the bank is filing paperwork and starting the process to   take legal action to repossess the house. You still have time at this point   to prevent foreclosure, but do not hesitate! The closer you get to the   foreclosure date the harder it becomes to negotiate with the bank for   whichever option you choose. 9.) I was denied for a   loan modification, so I know I will get denied for a short sale. Short sales and loan modifications are handled by two separate   departments at the bank. These processes are totally different in approval   and denial. If you got denied for a modification you can still apply for a   short sale; in some cases you can get a short sale approved faster than a   loan modification, as some loan modifications are denied because they cannot   reduce the loan low enough based on the consumers income. 10.) If I go through a   short sale I cannot buy another house for a long time. The time to buy another house depends on your entire credit   picture and can vary from 2-3 years. Fannie and Freddie just came out   November first and said a homeowner may be eligible two years after a short   sale to repurchase. There are even a few FHA programs that allow for a   purchase sooner than that, but the guidelines are fairly strict. Some   regional and local banks will finance 16-18 months after a short sale, but   the interest rate will more than likely be higher than one of the national   chains, and this is based on their specific under writing guidelines. These are just a few of the   common myths surrounding short sales and foreclosure. With the options   available today, no homeowner should ever have to go through foreclosure, and   hopefully this information can help a few more homeowners think twice before   walking away from their home not realizing the possible long term   ramifications a foreclosure can have.

Freefall Pricing for Single Family Homes on the North Shore is OVER!

The median price for a single family home on the North Shore decreased in 2012 by only 1.4% versus 2011.   Most communities showed slight pricing growth and a few showed declines. Check out this chart (PDF) to see how each community performed. Or click on the chart below to see larger version.

Kenilworth, the smallest community reported here, showed a huge decline.  Since this this is based on only 35 home sales it should not be taken as an indication that prices are dramatically declining there. 

Lake Forest, which showed the largest percentage decline in median price after Kenilworth (-16.7%) does appear to be behind the other communities in recovering on both pricing and sales.  Sales for Lake Forest increased over the prior year by 14.5%, while many of the other areas reported showed more robust sales numbers (see prior post).

Prices for condos/townhomes on the North Shore have not stabilized quite yet, though I expect that trend to turn around in the coming year.  The median price for these "attached" properties decreased by 7.3% in 2012 versus 20111.  These price declines fueled the strong sales increase of over 33% in 2012 that I reported previously.

Median prices in Evanston for attached properties, which represented almost 30% of the attached propertie sales, declined by over 13%.  Click on chart for larger image or click here for PDF.

In my next post I wil be looking at sales of distressed properties in 2012 versus 2011 and inventory levels.  Then, please stay tuned for my in-depth reviews of each north shore community.

Thank you for reading!!

If you’d like to understand how this information affects you and your home buying/selling decisions, contact me directly for a consultation.

@properties | Broker, MBA, ePro, SFR, CREN |  607  Central, Highland Park, IL 60093

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Condo and Townhome Sales Feed Housing Recovery on North Shore

From my last post you may recall that sales of single family homes on the North Shore increase by over 17% in 2012 versus 2011.  Sales of attached properties (condos and townhomes) increased by over 33% during the same time period.  Combined, sales of residential properties on the North Shore increased by 22.4%.

While Evanston had the highest number of "attached" sales overall with 416 units sold  (Evanston also has the largest housing stock on the North Shore), the largest percentage increase was in Highland Park.  The increase of over 88% in Highland Park for 2012,  was followed by Northfield with almost 74% more attached properties sold in 2012 than in 2011.  Northbrook and Skokie also posted strong increases in sales of attached properties.  Click on the chart to see larger/readable version, or clidk on the link printable PDF with chart and table. CHART AND GRAPH - PDF

The big question on everyone's mind is, "what is going on with prices?" I will review pricing in my next post.  All I will say at this point is that except for a couple of communities, prices appear to have stabilized for single family homes.  Attached properties are still showing across the board price declines versus 2011.

Thank you for reading!!

If you’d like to understand how this information affects you and your home buying/selling decisions, contact me directly for a consultation.

@properties | Broker, MBA, ePro, SFR, CREN |  607  Central, Highland Park, IL 60093

 Find any property for sale in the Chicago area 

 love where you LIVE

click here to follow me on Twitter

click here to find out more about me

click here to get a market report for your community

 

The numbers are in!! North Shore sales increased in 2012!!

Home sales on Chicago’s North Shore increased in 2012 by 17.6% over 2011.  Chart on the right shows the breakdown for each community (click on the chart to see larger image). 

Northfield had the largest percentage increase of 81%! This was followed by Wilmette with an increase of 27%, and then Skokie and Evanston, both with increases over 20%. Highland Park and Northbrook also performed above average with over 18% increases in sales. 

Sales of condos and townhomes increased by over 32% on the North Shore.   The net increase in sales for all residential properties on the North Shore was 22.4%. 

Over 75% of the sales were traditional sales, NOT short sales or foreclosures.  All good news for the housing market! 

More to come...stay tuned.

Thank you for reading!  If you’d like to understand how this information
affects you and your home buying/selling decisions, contact me directly for a
consultation.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North Shore community, click here.

Market Watch - Skokie, Wilmette, Winnetka

This is my 5th and last post in a series about the North Shore (Until January when I will do another update).  This is based on data through June 2012.  That is a few months ago, but the info is still valid.  Sales have been strong on the North Shore and there is a lot of activity right now.  In fact, that is why this post is so late...I've been so busy actually selling real estate that I haven't had time to report on the market.  Read my prior posts for info on the rest of the North Shore.  And, to learn how all of this impacts the value of your home, contact me directly for a custom market analysis.

Skokie

With the continued high level of distressed properties in Skokie I do not expect to see prices
stabilizing during 2012. However, I do expect the number of home sales to continue to increase in 2012. (This is exactly what I said in January…and I still believe this is true).

• Skokie had a 25.3% increase in the number of homes sold for the past 12 months versus the prior 12 months (June 2012 versus June 2011).  Increases were seen for both single family homes (+20.8%) and condos/townhomes (+32.5%). 
• Over 51% of the sales in Skokie were distressed properties.  This is the highest level of distressed property sales on the North Shore (as percent and actual number of sales).  It represents about 1/3 of the distressed property sales on the entire North Shore over the 12 months ending June 30^th.
• Inventory levels in Skokie declined since the end of 2011 with almost 8 months of single family homes available for sale and 10 1/2 months of inventory for condos/townhomes.  This is still high, but definitely an improvement.
• The number of distressed properties in Skokie is still higher than any of the other North Shore communities.  Even though there a lot of distressed properties have sold, the number of distressed properties in Skokie is only slightly lower than it was in January with 396 homes in pre-foreclosures and 189 bank-owned properties. This represents 2.3% of the total housing units (THU) in Skokie. 
• In January 2012 there were 408 properties in pre-foreclosure and 180 bank-owned properties.  This suggests that homeowners in Skokie continue to struggle to pay their mortgage and/or
  have negative equity.
• Interestingly the median price for a single family home increased in Skokie by 6% (with the
  lowest median home prices on the entire North Shore).  The median price for condos/townhomes declined by 30%.

 Wilmette

The market for single family homes in Wilmette is strong.  Although median home prices declined, we have seen multiple offers and very quick sales in this market due to the low inventory levels during the past 6 months.  I believe that prices for single family homes will show stabilization through the end of the year. 

• The number of homes sold in Wilmette increased by 15% during the 12 months ending June 30 2012 versus the prior 12 months. At the end of 2011, 12-month sales figures were declining, so this is a big turnaround.  Sales of single family homes lead the way with an increase of over 25%.  Condo/townhome sales declined by more than 15%.  Wilmette’s increase in single family home sales was the strongest on the North Shore during this 12 month period.
• Over 87% of the Wilmette home sales for the 12 months ending in June were traditional sales.  Over 7% were bank-owned properties and over 5% were short sales. The distressed sales increased slightly from 2011 year-over-year numbers.
• As of June, inventory for single family homes in Wilmette was declined to 5 ½ months, which is considered a balanced market (experts say that a “normal” or balanced market has 5 – 8 months of inventory). The inventory for condos and townhomes was 12 months in June, about the same as it was at the end of 2011.
• In June the number of distressed properties was about the same as it was in January.  There are 50 homes in pre-foreclosures and 22 bank-owned properties for a total of 72 distressed
  properties.  Distressed properties in Wilmette are 0.7% of the total housing units (THU) in Wilmette.  After Winnetka, Wilmette has the lowest/best percentage of distressed properties as a percent of THU.
• The median price of single family homes in Wilmette fell by 15.3% during the 12 months ending June 2012 versus the prior 12 months.  Condo/townhome prices slipped by 38.6%.

 Winnetka
The Winnetka market continues to do quite well.  While the sales increases versus the prior 12 months are not as dramatic as some of the other communities on the North Shore, the low number of
distressed properties and the low inventory levels are creating a very positive real estate market.  As in Wilmette, multiple offers have been common during the past 6 months and buyers are having
a difficult time finding what they are looking for.  If this continues over the coming months we
will see continued price stability and increasing prices.

• The number of homes sold in the 12 months ending June 30^th in Winnetka increased by 6.6% versus the prior 12 months. This is about the same percent increase as we saw from 2011 over
  2010. 
• Almost 95% of sales during the 12 months ending in June 2012 were traditional sales.  That is the highest percentage of traditional sales (versus distressed property sales) on the North Shore.
• The home inventory in Winnetka is over 8 months for single family homes and over 14 months for condos/townhomes.  This represents a decline in inventory from December 2011.
  There are 16 homes in pre-foreclosure in Winnetka, according to public records.  And are 7 bank-owned properties.  This is actually slight decrease in distressed properties versus last January.  Winnetka has the lowest/best number of distressed properties as a percentage of total housing units (THU) of 0.5%.   The North Shore as a total is 1.4%.
• The median price of a single family home in Winnetka increased by 2.8%  For townhomes and condos the median price fell by over 13%.

 

Thank you for reading!  If you’d like to understand how this information affects you and your home buying/selling decisions, contact me directly for a consultation.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North

Shore community, click here.

 

Market Watch - Kenilworth, Lake Forest, Northbrook

This is my 4th post in a series about real estate trends on Chicago's North Shore.  Please see my last few posts for a summary of trends in: 

• Illinois
• Chicago
• The whole North Shore 
• Deerfield, Evanston, Glencoe, and Highland Park

I have been so busy selling homes that posting this analysis is a little late - sorry about that.  The bottom line is that the real estate market has been incredibly busy, inventory levels are down, and we are headed towards a recovery.

Kenilworth

Kenilworth is a very small (and expensive) area of less than 900 homes.  All of the statistics for Kenilworth are based on a much smaller number of homes than the other communities, so I will not
make direct comparisons.  Sales have been fairly consistent in Kenilworth over the past 2 years.  While this analysis does not focus on sales performance by price range (I do this type of analysis when discussing pricing with home sellers), it is safe to say that performance of this market suggests
that recovery of luxury home sales is lagging behind less expensive properties.

• The number of single family homes sold in Kenilworth decreased to 32 sales in the
  past 12 months from 35 homes in the prior 12 months.  Additionally there were 2 condos/townhomes old in the past 12 months, up from zero.
• One of the Kenilworth sales was a short sale and one was a foreclosure.
• At the end of June there was over 11 months of inventory for single family homes
  in Kenilworth.  This is only slightly lower than it was in December 2011 (12.4 months)
• There is one home in pre-foreclosure in Kenilworth and one that is bank-owned.  This represents 0.2% of the total housing units (TNU) in Kenilworth.  There were 7
  distressed properties in Kenilworth in January.
• The median price decreased from $1.595 million to $1.305 million (-22.2%)

Lake Forest

Although the number of distressed properties in Lake Forest is relatively low, the inventory levels continue to be high, and prices appear to be flat or declining.  As I said in my January report, I believe that the turnaround for Lake Forest is slightly behind Highland Park.  I expect sales of single
family homes to stabilize or increase in Lake Forest through the end of the year.

• Lake Forest sales increased by 11% during the 12 months ending in June 2012 compared to the prior 12 months.  Single family home sales increased by 15% (similar to North Shore as a whole) while condo/townhome sales dropped by 3.8% (well below the rest of the North Shore). 
• Over 87.5% of the sales in 2011 were traditional sales (not foreclosures of short sales).
• Inventory levels for Lake Forest in June were the highest on the North Shore with over 14
  months of inventory for single family homes and over 16 months for condos/townhomes.  This is an improvement from the end of 2011 where single family home inventory was over 16 months, and 18 months for condo/townhomes.
• Tax records show that there were 50 homes in pre-foreclosure and 17 bank-owned
  properties in Lake Forest at the end of June. This represents about 0.9% of total housing units (THU) in Lake Forest.  This is a slight increase in distressed properties from January when there were 63 distressed properties.
• The median price of a single family home decreased in Lake Forest by 1.4%%, while he condo/townhome median price dropped by more than 46%.

Northbrook

The overall sales increases in Northbrook have been very strong.  However, we will not see pricing improvements until the more of the distressed properties are cleared out of the market and  inventory levels decline more.  Condo/townhome prices will take longer to stabilize than single family home prices.

• The number of homes sold in Northbrook increased by 23.2% for the 12 months ending June 2012, compared to the prior 12 months.  Similar to Deerfield and Highland Park, most of the increases in Northbrook were in the townhome/condo market where sales increased by over 40%. Single family home sales increased by 14.4% in the same time period.  This continues the trend that we saw in at the end of 2011 with townhome/condo sales showing stronger increases than single family homes in Northbrook.  The overall increase to 23.2% at the end of June is higher than the North Shore combined increase of 18.8%.
• The percent of home sales that were distressed properties is about the same as it was at the end of the year, almost 23% for the 12 months ending in June.  The mix of distressed properties shifted slightly with a slight increase in the percent that were bank owned (13.5% of
  total sales) versus short sales (9.3%).
• Inventory for single family homes declined slightly compared to December 2011 from 9 months to 7.9 months.  Condo/townhome inventory also declined from over 11 months to 8.8 months.  This is headed in the right direction, but still a buyer’s market.
• As of the end of June, Northbrook had 124 homes in pre-foreclosure and 72 bank-owned properties.  This is represents a slight decrease in distressed properties from January.  With distressed properties representing 1.6% of the total housing units (THU) in Northbrook this is similar to the North Shore as a whole, which had distressed properties at 1.4% of THU.
• The median price for a single family home fell by 3.3% in Northbrook, while condos/townhomes saw a decline of 16.8%.

Next up: Skokie, Wilmette and Winnetka.  If you are interested in a spreadsheet with all the numbers, please contact me and I will share.  The spreadsheet also includes Northfield.

Thank you for reading! If you’d like to understand how this information affects you and your home buying/selling decisions, contact me directly for a consultation.

nsk

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North
Shore community, click here.

North Shore Market Watch - Glencoe and Highland Park

This is the third post in a series about real estate trends on Chicago's North Shore.  Please see my last two posts for a summary of trends in Illinois, Chicago, The North Shore as a whole, Evanston and Deerfield. (It is taking me a little longer to post these articles than anticipated because I have been working round the clock with buyers and sellers - negotiating three different contracts as I finish this post!!)

Glencoe

• Sales in Glencoe (which had a huge 24.5% year-over year increase in home sales
  reported at the end of 2011 over 24 %) were flat.  The total number of homes sold during the 12 months ending June 30, 2012 was 1 property less than in the prior 12 month period.  The number sold for condos was identical to the prior period – there was one less single family homes sold than in the prior period.
• About 16% of the home sales were distressed properties (short sales or bank-owned).  More of the distressed property sales were short sales than bank-owned properties.
• Inventory levels came down for single family homes from 9.4 months to 8.3 months.  Inventory for condos/townhomes is about the same as it was 6 months ago at 9.2 months. 
• The number of homes in pre-foreclosure or bank-owned Increased slightly from 25 in
  January to 37 in June 2012.   This is 1.2% of the total housing units (THU) in Glencoe.
• The median price of a single family home in Glencoe declined by only 2.5%.  Median prices for condos/townhomes went down dramatically for the most recent 12 month period, but since this was based on only 6 sales, I am not reporting the number.

Overall sales performance in Glencoe was not particularly strong or weak.  Inventory levels came down versus the prior 12 months, but not a lot.  Sales were flat.  The number of distressed home
sales is similar to what we saw in January. The median home price declined, but only slightly.  This market is slowly moving in the right direction.

Highland Park

• Highland Park leads the North Shore with the second highest percent increase in home sales (+31.4%) for the 12 months ending 6/30/2012 versus the prior 12 months. As in Deerfield this strong sales performance was driven by a very large increase in condo/townhome sales.  Single family home sales increased by 21.7% over the prior 12 months.
• Almost 80% of the sales were traditional sales (not short sales or bank owned
  properties). 
• Inventory levels in Highland Park have declined since January, but they are still high compared to the rest of the North Shore (except Lake Forest) and higher than Chicago and Illinois with 10 months of inventory for single family homes and 15 months of inventory for condos/townhomes. 
• Shadow Inventory (homes in pre-foreclosure or bank owned) increased in Highland
  Park.  At the end of June there were 106 homes in pre-foreclosure and 51 bank owned properties.  This is 1.3% of total housing units THU) in Highland Park.  In January Highland Park Shadow Inventory was only .8% of THU.
• The median price for single family homes in Highland Park increased by 7% during the 12 months ending 6/30/2012, compared to the prior 12 months.  Condo/townhome median price declined by 25.8% (contributing to the high number of sales!)

Since the Highland Park inventory levels are still high, especially for condos/townhomes, I anticipate that we may still see more price declines in this market.  This is in spite of the fact that the median price for single family homes increased in the most recent 12 month period.  The increase in Shadow
Inventory is concerning because this is another factor that could cause downward pressure on prices in Highland Park.

Stay tuned for updates on the rest of the North Shore communities.

Thank you for reading! If you’d like to understand how this information affects you and your home buying/selling decisions, contact me directly for a consultation.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North
Shore community, click here.

June Market Update - North Shore, Deerfield and Evanston

The first half of 2012 looks very good for the North Shore overall.  The median price of a home increased each month starting in February, as did the number of properties sold.  Monthly inventory levels for December through
June have been lower than any time during the preceding 2 years.  These are all positive signs for the housing market.

Total North Shore home sales increased by 19%
during the 12 months ending in June 30 compared to the prior 12 months (better than Chicago, slightly worse than Illinois). Sales of single family homes on the North Shore increased by 15.5%, while condo/townhome sales increased by almost 27%.  This is a dramatic shift from my report in January where calendar year over year comparisons showed a very slight increase in sales (1.3%). These increases were clearly based on sales in the first half of the year. Incredibly low interest rates and pent up demand appear to be driving these sales. 

Almost 24% of the sales on the North Shore were distressed properties.  Less than 10% of the sales on the North Shore were short sales; almost 15% were bank-owned (foreclosed) properties.  These
percentages are slightly higher than what I saw in January.  When you take into account the higher overall sales numbers it becomes clear that more distressed properties have been selling
over the past 6 months than in prior months.

Deerfield

• Deerfield continues to be one of the strongest markets on the North Shore with a 36.2% increase in the number of homes sold in the 12 months ending in June versus the prior year.  (Highland Park follows with a 31.6% increase in sales.)  This increase was driven to a large degree by an increase in condo/townhome sales over the prior year of more than 85%.  Single family home sales increased by over 18%.
• Over 20% of Deerfield home sales during the recent 12 months were distressed properties (Over 13% were bank-owned and more than 7% were short sales). 
• The inventory levels in June were 7.8 months for single family homes and 9 months for
  condos/townhomes (5-8 months is considered a balanced or “normal” market).
• According to public records there are 75 homes in pre-foreclosure in Deerfield and 27 bank-owned properties.  These represent about 1.5% of the total housing units (THU) in Deerfield, which is the second highest percentage among the communities I analyzed on the North Shore.  This is exactly the same as it was in January.  (Skokie continues to have the most distressed
  properties as a percent of THU right now on the North Shore.)
• The median sale price for single family homes increased by 4.2% (better than Chicago).  Median prices for condos fell by 12.2% (same as Illinois, worse than Chicago).    

Overall I think that Deerfield continues to head in a positive direction.  For single family homes the market has stabilized in terms of price and inventory.  Condos and townhomes in Deerfield are still trending downward and will witness some additional price declines during the next 6 months.

 Evanston

• The number of homes sold in Evanston increased by 13.5% in the past 12 months compared to the prior 12 months.  The increase was slightly higher for single family homes (+13.9%) than for condos and townhomes (+13.2%).  This is a nice turnaround versus 6 months ago when year-over year sales were down by 9.7%. Evanston’s turnaround is lagging behind the state and the rest of the North Shore communities, but is on par with the city of Chicago.
• Less than 23% of the sales in Evanston were distressed properties during the past 12 months.
• Inventory for single family homes in Evanston is down to 6.3 months – this is the second lowest level on the North Shore, following Wilmette. Condo/townhomes inventory is 11.6 months.  Evanston inventory numbers are lower (better) than 6 months ago; however the condo/townhome inventory is higher than Illinois and Chicago.
• The number of bank-owned homes and homes in pre-foreclosure in Evanston increased slightly
  since last January.  There are now 370 distressed properties according to public records, up from 340 in January.  These distressed properties represent 1.1% of total housing units (THU) in Evanston. For the North Shore as a whole, this number is about 1.4%, so this is a positive sign for Evanston.
• The median price for a single family home in Evanston dropped by 3.5% during the past 12 months, slightly better than Illinois and the city of Chicago.  However the median for condos and townhomes dropped by over 29% in Evanston during the same time period.  This is a larger decline for condos and townhomes than we saw at the end of 2011 (it was -14.9%). 

The city of Evanston continues to exhibit two very different markets.  Sales, inventory and prices for single family homes are showing improvement, while condos and townhomes prices continue to
decline.  Bottom line is that demand for condos and townhomes is still lagging in Evanston.  For the rest of 2012 the number of home sales should continue to be strong in Evanston.  Prices for single family homes appear to have stabilized, but prices will continue to decline in the condo/townhome market until it matches demand.

The relatively low number of distressed properties as a percent of total housing units continues to buoy the Evanston market.

Stay tuned for updates on the rest of the North Shore communities.

Thank you for reading! If you’d like to understand how this information affects you and your home buying/selling decisions, contact me directly for a consultation. 

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North

Shore community, click here.

June Market Update

Sales data from the first half of 2012 are in, and things appear to be moving in the right
direction on the North Shore!  The past 6 months have seen strong sales numbers and prices have stabilized; in some areas we are seeing modest price increases. The big question is whether or not this is just a seasonal trend or if the worst of the market is really behind us. 

I just finished my analysis.   I will be posting my report in several installments over the next few days.

In this first post you will find an overview of what is going on in the state of Illinois and the general Chicago area.  Then in subsequent posts I will use this information for comparison with each of these North Shore communities:  Deerfield, Evanston, Glencoe, Highland Park, Kenilworth, Lake Forest, Northbrook, Northfield, Skokie, Wilmette, and Winnetka. 

Illinois
MONTHLY TRENDS:  According to the Illinois Association of
Realtors, June was the 4^th month in a row with an increase in the median price of a home (both single family and attached housing).  The median price rose by 3.3% compared to June a year ago.  The number of homes sold in Illinois increased by 18% in June versus one year ago.  On a month-to-month basis the first half of 2012 is clearly trending upward and appears stronger versus 2010 and 2011.

• For the 12 months ending June 30, 2012, median home prices declined by 8% in the state of Illinois.  The decline was larger for condos and townhomes, with a median price decline of 12.2%.  For single family homes the decline was 5.1%.
• Overall home sales in Illinois increased by 21.4% during the 12 months ending in June, versus the prior 12 months. Condo/townhome sales led the way with an increase of 24.6% while single
  family home sales increased by 19.8%. 
• As of June 30^th 2012, inventory levels in Illinois were still higher than a “normal” or balanced market of 5-8 months, with 10.3 months of inventory.  (This is calculated by dividing the number of homes for sale by the average number of homes sold each month.)  This was slightly higher for condos/townhomes at 11 months, and 10 months for single family properties.
• Crain’s Chicago Business reported on July 13^th that 28% of homes in Illinois with a mortgage are underwater (amount owed on mortgage is greater than current value of the home).

Chicago PMSA

(The Chicago PMSA, as defined by the U.S. Census Bureau, includes the counties of Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will)  Performance of this area was almost identical to the entire state of Illinois, so I am not going to cover the detailed statistics.  Overall the first half of the year saw increasing median prices each month and declining inventory levels.  Both of these are positive indicators for the housing market.

The City of Chicago

• Similar to the entire state, June was the 5^th month in a row with an increase in the median price and the number of homes sold.  Inventory levels also declined each month during the same time period.
• Unlike the rest the state, the median price was the same for the 12 months ending June 30, 2012 as the prior 12-month period.  For single family homes, the median price increased by 3.9% over the prior 12 months! Condo/townhome median price fell by 3.9% (it was -5% in Illinois).
• Inventory levels for Chicago in June were lower than the state, with 9.2 months of inventory overall; 8.7 months for single family homes and 9.5 for condos/townhomes.
• The number of homes sold increased in Chicago by 13.6% - this is a
  lower percent increase than the state of Illinois.  Similar to the state, the increase in sales
  of condos/townhomes (17.2%) was higher than the increase in sales of single family homes (8.7%) over the prior 12 months.

Watch for my market by market reports over the next few days!!

Thank you for reading! If you’d like to understand how this information affects you and your home buying/selling decisions, contact me directly for a consultation.

To find any property for sale in the Chicago area, click here.

For up-to-the minute market information, including recent sales, on any North
Shore community, click here.