Chicago Weekend Fun!

Aaaaahhhhh!!!! Runs screaming from the open house...

Even though we are still feeling the affect of the recession, Chicago open houses are on my calendar this weekend. My husband and I have decided that its time to find a house to settle down in and move from our small 2 br townhouse. We spend a lot of evenings searching through hundreds of real estate listings in the Chicago area to find a diamond in the rough. (and there is a lot of rough!) We probably look at more homes online than most people because the area we are searching to buy in is pretty large. (most of the western suburbs) We also end up rejecting a lot of homes for a lot of reasons that are probably pretty common in this economy.

Something’s gotta give though, and the economy isn’t going  to move forward until all of the people like us (with a 20% down payment ready to go) are able to get past at least one of these barriers and buy a house sometime soon. If you are trying to sell your home these things we’re running up against may provide some insight into why your home isn’t selling yet.

1. Not close enough to the METRA train. Parking is notoriously difficult to get in most west suburban metra stations (like 7 year waiting list long) so a lot of pressure is put on the homes within walking distance to the train, and not just the tracks, the station itself. Homes with 4 bedrooms or more within 6 blocks of the Naperville train station go for $600,000 to $1.5 million. Sometimes I wonder why we even try to find a house in these areas… What is less than that is usually painfully small, painfully out of date or demolished or earmarked for demolition so a McMansion can be built for some rich executive that needs to travel downtown every day.

If we only had the skills of these guys...

2. Kitchens/Baths not recently updated and we’re not Bob Vila or Norm Abrams. (we wish we were though) We can update some things, but a full house rehab is not our cup of tea. We’re going on 2 months on a simple Vanity/Paint/Sink bathroom remodel at home now. We also aren’t Richy-Rich enough to afford someone else doing the renovation either. I think if one room needs an overhaul that is ok, if the entire house needs it, the house gets rejected. (about 90% of what I see online is in this category)  Everyone knows that once you have kids you won’t ever have any money to renovate again, so it’s either included when you buy the house or it never happens and you have a lifetime of relatives trying to politely avoid Christmas Eve invitations. This is why there is so much pressure to get a recently updated house. Just watch HGTV’s suite of 12 million shows on how to quickly and cheaply update and stage a home to sell. They’re actually very good at it. Just don’t believe how fast its done in. That part is not true. (and a test: if your kitchen cabinets have hinges on the outside of the door that are visible OR have an oak strip across the bottom of a white laminate cabinet door, you need to get them replaced or refaced before selling. And Advice: all wood tones go out of style within a few years, get white instead! Likewise, if you have flourescent tube lights in the celing with a fake window pane cover, they need to go now!)

3. Pre-Recession home pricing. I have switched from using Realtor.com’s site listings to using Redfin.com. There you can see the past sale history of the home you are looking at if it is publicly available. (it usually is if its been sold within the last 15 years) If we see that the home was purchased at the top of the real estate bubble in 2006-2007 and they want the same price for it now, no-way-Jose. The entire Chicagoland metropolitan area has declined in value about 20% from then and the people who price accordingly are the ones selling. If your home is not updated, take off the mandatory 20% plus the cost of renovating the rooms that need it. I had to sell my condo at 20% less than the value, how can I go pay a premium for someone else’s home?

The holy grail of kitchens, celing height cabinets, lots of storage, an island and white cabinets!!!

4. Its already contingent on a sale. You would be surprised how fast a home sells if it’s had the kitchens/baths recently updated (within the last 10 years)  and its price is about 20% lower than the peak. Maybe a week and its sold. So if your goal is to move out of town and loose that mortgage payment to start your new job and life somewhere else, this is how to do it. And by recently updated we don’t mean super fancy, just nice basic stuff is way better than a 1972 kitchen. (and there are surprisingly still thousands of 1972, 1961 and 1985 kitchens out there. It’s been a trend lately that as soon as we find a house that has dropped the price with the market and it looks like its in good working shape, it’s contingent. One loophole we are hopeful about is possibly finding Foreclosed Homes or Short Sales. We know some are in bad shape, but a lot of the homes being foreclosed on are recently renovated or built when the bubble was high and are still in nice shape. One thing that makes this difficult is the length of time it takes to close with the bank that owns them.

5. Near water and/or has a pool. (hot tubs are not great either, and why on earth do you have a professional Bowling Alley in your basement of a 4 bedroom ranch?) I am not a swimmer so pools, lakes, rivers, retention ponds, hot tubs and bowling alley’s scare me. Ok not the last one. I just don’t have extra cash to maintain these water works (waterfalls in the backyard are also a bad idea, difficult to maintain) so remove them if possible. Plus, who wants to sit in a Hot Tub where the last owners got-it-on anyway???

6. Sometimes the home has been discounted but the Property Taxes are still too high. This is difficult because some homes are discounted heavily and the taxes are almost as much as the mortgage payment from 2007 levels. No county or town is going to lower them without a serious fight either. They are short on budgets and cash also. So, these usually are excluded too. If you can re-negotiate your property taxes before you sell this will be a huge help to getting it sold faster.

So, I will not be spending my weekend frolicking in the leaves at Morton Arboretum where I would like to be. It is very likely we will be walking through open homes for sale and trying to find one that is affordable, nice and in a good location, but judging from the last month or so it may be a while…