Here are a few interesting trends that will make buying North Shore homes for sale in the coming months an activity that you should undertake with a knowledgeable realtor on your side.
North Shore Homes For Sale: How Foreclosure is Affecting Price
According to Chicago Real Estate Daily, foreclosures were up in 22% in the month of February. Additionally, it’s not just the urban market that is suffering from the foreclosure crisis– it’s happening in the suburbs, too. Toward the end of 2009, increased foreclosure rates were occurring in the affluent suburban areas of North and Northwest Chicago, instead of being focused in the downtown condo market and southern suburbs.
These rising foreclosure rates will probably lead to an increased number of short sales in those areas. As homeowners face foreclosure, they will sell their home at a bank-approved loss rather than have foreclosure affect their credit score.
For buyers navigating the North Shore Chicago real estate market, understanding foreclosure's effect on pricing is important.
Buyers of North Shore homes for sale benefit from this because:
- You can purchase a short sale yourself, buying a desirable home at an affordable price while helping the seller avoid foreclosure.
- Or, if you are looking at homes in an area where there is a rising foreclosure rate, you will probably see all asking prices being lowered to compete with short sale prices in the area.
However, no matter where you are looking in the Chicago area, this will most likely be the case. According to the same article, in Kane, Cook, DuPage, Lake, McHenry and Will counties, the foreclosure rate rose at least 24%. In Kane County, where it rose the most, the foreclosure rate was up 57%. This increasing foreclosure crisis will contribute to low home prices as long as it continues.
How the Tax Credit is Affecting Price of North Shore Homes
Also affecting home prices on the North Shore of Chicago is the upcoming deadline of the home buyers tax credit. Although, by June, buyers will no longer be able to gain an $6,000 – $8,000 credit on their new home purchase from the government, it might affect pricing in a way that is beneficial for buyers after all.
Sellers who want to move their homes quickly probably want to take advantage of the large number of buyers who will be trying to get their purchases in before the deadline of the credit. Because of this, sellers could price their homes aggressively, competitively and to sell rapidly. As a buyer on the North Shore, you are in a good negotiating position with a seller who wants to sell their home now. If you want to close for a good price and the seller wants to close quickly, you are in a good place to satisfy one another’s needs.
Here are some great things to keep in mind as the tax credit comes to a close, from the Wall Street Journal. Buyers planning to use the credit should note:
- The tax credit doesn’t just cover first-time buyers. Move-up buyers are also eligible, though they only qualify for up to $6,500.
- Only the contract has to be signed on or before April 30. The home purchase must be completed by June 30. Real-estate experts advise signing the contract as soon as possible and leaving plenty of time for closing.
- The definition of a first-time buyer isn’t as limiting as the words indicate. In this case, the “buyer” hasn’t owned a principal residence in three years. For married taxpayers, both parties can’t have owned.
- You can’t purchase a home from most family members using the credit: Parents, children, grandparents and grandchildren are excluded.
- Consider that prices might fall after the credit expires: Buyer traffic will undoubtedly decline once this enticement goes away. As sellers adjust to this slower new reality-they could be more than likely to shave prices.
- Of course, there’s talk of another extension, given housing’s recovery remains choppy. If you can’t find a price that works for you or a home you genuinely like, it’s not the worst idea to wait.
Tags: Chicago North Shore homes for sale, chicago real estate market activity, federal housing tax credit, foreclosures, north shore chicago real estate, north shore homes for sale, north shore real estate, short sales
