Chicago Real Estate Investing

If you’re an investor in the Chicago real estate market, you probably remember the days when you could buy a home, fix it up a little, and flip it for a nice profit. This “strategy” was used by many investors and homes were selling like hotcakes. Of course, before the market collapse, demand was high and loans were plentiful. Part of that demand was created by people transitioning from renting to owning.

Anyone reading real estate headlines today knows that this scenario doesn’t really hold true today. On the Equifax Personal Finance Blog, real estate investor and RealtyJoin.com co-founder Andy Heller discusses the need for today’s investors to change tactics. His article, “Prepare Your Real Estate Strategy Before You Buy,” examines how the market has changed and how to be successful even in today’s economy.

According to Heller, more people are looking to rent than own. In fact, he reports seeing projections of up to 5 million new renters within five years. Because of this shift, Heller suggests that investors become landlords. If the thought of dealing with tenants sounds like a persistent headache, lease options may be the way to go. With lease options, there are several advantages, including the potential for the renter to buy the home after a set time period.

Because these types of agreements put the responsibilities of upkeep and repairs on the renter, playing landlord may not be as bad as you think. Plus, the potential for homeownership means your renters may take those responsibilities more seriously.

via Chicago Real Estate Investment | Equifax Personal Finance Blog | Chicagoland Real Estate Forum.

A closely watched index of local home prices jumped in June, its second straight monthly increase, though prices here remain roughly where they were in 2001.

The Standard & Poor’s Case-Shiller index of Chicago-area single-family home prices rose 3.2% from May to June but was still down 7.4% from the year-earlier level, according to a report released Tuesday. The index rose 1.7% from April to May, it’s first monthly gain since last August.

The 3.2% rise was the biggest monthly gain for the Chicago index since at least 1987, the earliest year for which data are available.

Chicago was one of 19 of 20 cites tracked by Standard & Poor’s where prices rose in June; a 20-city composite price index increased 1.1% from May, according to the report.

The increases are an encouraging sign for a housing market stuck in a five-year slump, but the weak economy, tight lending climate and high loan delinquencies remain obstacles to a recovery.

The Chicago-area price index is down 31% from its peak in September 2006 and is back where it was in July 2001.

An S&P/Case-Shiller index of local condominium prices also rose 4.3% from May to June but was down 13.4% from a year earlier. The index has fallen 29.9% from its peak in September of 2007 and stands roughly where it was in April of 2001.

via Local home price index shoots up in June | Residential News | Crain’s Chicago Business.

Chicago-area home sales rose almost 28% in August compared with the previous year, the second consecutive increase after a string of declines.

In the nine-county area, 7,187 single-family homes and condominiums sold last month, up from 5,632 in August 2010, according to a statement Wednesday from the Illinois Assn. of Realtors. July sales rose 19.2% locally compared with the year-earlier month. Before then, monthly sales hadn’t risen since June 2010.

“A strong buyer’s market continues in the Illinois housing market with record low mortgage interest rates and lower home prices although job worries and overall economic uncertainty are holding many back,” Sheryl Grider Whitehurst, president of the association and a managing broker for Traders Realty in Peoria, said in the statement.

Sales in the city of Chicago rose 20.3%, to 1,787 compared with 1,486 in August 2010, the Realtors said.

Statewide sales rose almost 26% to 10,622.

The Illinois sales figures include new and existing homes. The nine-county Chicago area consists of Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will counties.

via Local home sales jump for second straight month | Residential News | Crain’s Chicago Business.