Ruth Karel Chicago Real Estate

SQUARE FOOTAGE NOT SO SQUARE

Ruth Karel — Tue, 09 Mar 2010 20:43:57 +0000

Frankly, square footage gives me the willies. It makes about as much sense to me as a square watermelon! In one of my early years in real estate, I was nearly sued for misstating the square footage of a condo. I had quoted the developer’s number, which virtually every other listing in the building used, a perfectly normal thing to do. Or so I thought. The problem arose when the buyer of the unit measured the home and came up with a different figure. Square footage was extremely important in the buyer’s part of the world and totally irrelevant in the the seller’s native land. So there I was stuck between the two. With some skillful negotiating by the attorneys (there are times when it comes in handy to be in an attorney approval state), the matter was resolved without a law suit. Lesson learned! I am still very reluctant to quote square footage on a listing.

Why do I feel square footage is a poor way to measure the value of a home?

No reliable uniform standard for measuring–no rules. Does the balcony count? Are we measuring from the outside of the front door to the outside of the front wall? Or, are we measuring from the inside of the front door to the inside of the front wall?
Think of some of our vintage condos here in Chicago–what do you do with a hall that is six feet wide and thirty feet long? How much of that space is usable unless you have a lot of pictures and need a gallery. You might prefer a larger living room over a long hall! And don’t even think about that rounded turret on some of the buildings–how do we measure that?
Lots of deals are coming apart at the seams right now–inaccurate (according to the appraiser) square footage can result in an appraisal being rejected.
Square footage is extremely subjective and most agents know that buyers want the biggest home they can get for the money–this can result in an overstatement of the square footage by the selling broker. When you check the Multiple Listing Service for properties, you can see square footage variations that will curl your hair–another reason to know the broker you are working with.

So there you have it–square footage is not a reliable measuring tool for figuring the price of a home. So much depends on who furnished the numbers and how the square footage is measured and who measures it.

If you need to talk about Chicago real estate, plese call me–direct dial is 312-981-2360, cell phone is 312-607-1306, e-mail works too!

BABY STEPS FOR PAYING DOWN YOUR MORTGAGE

Ruth Karel — Mon, 08 Mar 2010 21:23:42 +0000

Lew Sichelman seems to be my new favorite columnist. Something I knew but didn’t internalize is how much a small amount of money applied to the mortgage principal can shorten the length of your mortgage. Lew Sichelman recently published an article that gives a number of scenarios for shortening the time you pay on your home. If you do decide to make an extra payment on principal, be sure to tell the your mortgage company that is what the extra money is for. Just like so many things in life, consistency is the key to success. Even $50 per month applied to the principal can shorten the life of your mortgage. Lew also has some good information on PMI (Private Mortgage Insurance) and how to negotiate your way out of it. Refinancing from a 30 year mortgage to a 15 year mortgage is another way to save a large number of interest payments. My suggestion to you is to read the whole article if you want to pay down your mortgage with lightning speed.

Do you need someone to talk to about Chicago real estate–either selling or buying? Please call me if you do–direct dial, 312-981-2360, cell phone is 312-607-1306. E-mail works just fine too!

Other articles you might like to read are:

Why Get An Inspector For My New Home?

911 and Chicago Real Estate

BUNGALOW BELTS ALL OVER CHICAGO

Ruth Karel — Fri, 05 Mar 2010 17:08:18 +0000

Bungalows are a very practical style of home and they are quite common in many Chicago neighborhoods and the close-in suburbs of Cicero and Berwyn. Actually they are scattered through out Chicago and near-by suburbs quite liberally. When you first look at one of the streets lined with bungalows, they all tend to look alike, and sometimes they do. If you look carefully there are variations in the brick–tapestry brick was a popular upgrade–common brick on the sides and then a more expensive front on the street side. Another variation that I have seen a lot in Cicero and Berwyn, is the use of art-glass strips in the upper window panels on the front of the home. Some of it is really quite beautiful. Usually the designs are more geometric than floral. North Mayfair, a neighborhood around Elston, Foster, and Lawrence, has recently been named by This Old House magazine as one of the country’s 50 best old-house neighborhoods. The neighborhood has a great history of community involvement beginning with the formation of the North Mayfair Improvement Association in 1929, that’s right 1929. The Association worked its way through the lengthy and laborious for having North Mayfair listed on the National Register of Historic Places. Fortunately the Historic Chicago Bungalow Association gave a helping hand–it still took a year and a half. Last Sunday’s Chicago Tribune has a wonderful article about North Mayfair and the community involvement there. Click here to read the whole thing.

Some other articles that could interest you:

Real Estate Conversations

Empty Nests are Glorious

Chicago Real Estate News Versus National Real Estate News

ZIP YOUR LIP

Ruth Karel — Thu, 04 Mar 2010 22:14:49 +0000

Lew Sichelman published an article recently that clearly outlines the perils of a sellers presence in their home while it is being shown. All kinds of information can be divulged that the average home owner wouldn’t believe is damaging–and it can be. The best thing for a seller to do is vacate the home during a showing–a buyer’s agent doesn’t have to be unscrupulous to ask questions that will help the buyer get the best price possible. You have to remember always that the buyer’s agent is representing the buyer and the buyer’s interests. The more a seller talks the more likely he is to say things that will diminish the price his home will sell for. The Sellers Golden Rule is “Get the property ready to show and vanish.” By doing that you can’t say anything that will harm price negotiations. Though Lew’s article doesn’t mention it, I think it is a good idea to impress on my sellers that when their home goes under contract, do not tell anyone what the contract price is. Especially today when not all contracts result in a closing–this is very important. Many more deals are not going through than I ever remember in my 21 years of being a Realtor. If the contract price is known, you may not be able to get that same price with the next contract. Of course you always hope the second contract will be for a higher price–another great reason to keep the agreed upon price a secret. The best thing a seller can do is be silent and invisible! To read the entire Sichelman article just click here.

Need good advice on buying or selling real estate in Chicago? Just call me at 312-981-2360, direct, or cell lphone 312-607-1306. E-mail works too!

Here are a few articles you might enjoy reading:

Empty Nest FAQS

Empty Nest FAQS – Second Edition

Agents May Say “No” to a Listing

CHICAGO CONDO MARKET UPDATE

Ruth Karel — Wed, 03 Mar 2010 21:40:46 +0000

Don DeBat’s recent article was a real encouragement to buyers, especially first time buyers. The news is not so great for sellers because prices are still falling. Gail Lissner’s assessment of the current situation petty much covers the bases–FHA financing, condo discounts, the increase in new buyers, rent-to-own possibilities, and the lack of new developments–all of these are explored in the article. I really think you would enjoy this most informative article whether you are thinking of buying or selling or just staying put. To read the entire piece, just click here.

STAGING – TWO KINDS

Ruth Karel — Mon, 01 Mar 2010 22:56:00 +0000

The break was wonderful–and I am glad to be back with my blog again! I was thinking about staging and it occurred to me that there are really two kinds of staging. One might be called by the old fashioned name of “spring cleaning” and the other is part of the “preparing your home for sale” process. Staging in general implies that you are de-cluttering and just generally neatening and cleaning your home. Here are a few ideas for both.

Examine each room with an extremely critical eye. What can be eliminated? Does it need a fresh coat of paint–a new color, perhaps one wall could be an accent color, a bit of wallpaper might be in order.
How does the floor look–dirty carpet in need of replacing, worn wood that needs refinishing, chipped or cracked floor tile in the kitchen or bath?
Trim–are the baseboards and door frames chipped and all banged up?
Artwork and pictures–do you have too much stuff on the walls, too much stuff on table tops, too much stuff in book shelves–be merciless in getting rid of it. If you are selling your home and have too many things you just can’t bear to get rid of, think about boxing them up and putting them in storage until you sell your home. I have had clients put their children’s excess toys in storage in order to present a less cluttered appearance. You can always go back to your old cluttered self if you really want to. If you are doing the spring-cleaning staging, try living with less clutter–you might like it!
Pictures–they deserve a special mention. This is where the two kinds of staging have a definite separation of the ways–family pictures are a huge no-no if you are selling. Just be sure to have tasteful art work on the walls that blends with the furnishings of the room. If you are staging just for you, family pictures are wonderful. Personally, I have a triple dresser top full of them–in all kinds of frames. And they do make my heart glad.
This doesn’t have anything to do with staging–clean,clean,clean! Be sure everything is squeaky clean. It would n’t hurt to give your wooden furniture a bit of a polish, either.

Hopefully, this will give you some forward motion to the spring cleaning mindset or getting ready to sell mindset.

Questions about Chicago real estate? I would love to find the answers for you–312-981-2360 (direct), cell phone (312-607-1306) or e-mail.

BRAKING FOR A BREAK!

Ruth Karel — Mon, 22 Feb 2010 20:55:02 +0000

Sometimes one needs to stop, re-group and start up again. Just take a break and shift to another gear for a few days. And that is what I am about to do. Much as I’ll miss the daily head scratching that accompanies the hunt for a blog subject, I will be a non-blogger until next Monday. The coaching group that I belong to is going on their annual retreat–this is perfect timing!! Our real estate market in Chicago seems to be more active than it was last year–thank goodness! and I feel that I will come home from the retreat full of vim and vigor–so I’ll miss you all and I’ll be glad to be back at the head scratching on March first. I do hope a few people will miss me!

Here are three posts that might interest you and help you keep me in mind while I am gone:

Closets, Closets, Closets

Empty Nest FAQs – Second Edition

Chinese Time in Chicago and Hawaii

HOUSING FROWNIES FOR 2010?

Ruth Karel — Fri, 19 Feb 2010 21:58:08 +0000

Usually the Spring selling season begins with the Super Bowl. This year that didn’t quite happen–it actually started in the first week of January. January activity was quite good and February has been a bit slower. Dan Oppenheim, a home building analyst with Credit Suisse, is predicting that we’ll see a strong Spring selling season. He feels that builders are shifting from survival to rebuilding profitability and he also feels that five threats remain:

The Tax credit will expire–this should give urgency to buyers and help first-quarter sales. What could happen after that is a slowdown.
Mortgage rates rise. Low mortgage rates have prevailed for a long time. Most analysts expect a rise in rates later this spring when the Federal Reserve stops buying mortgage-backed securities.
Foreclosures continue. In spite of the government’s efforts, people are still losing their homes and nobody knows when the end will happen. Mr. Oppenheim writes that “The continued supply of foreclosures will mute any improvement in demand.”
FHA tightens lending. Higher insurance premiums and ecreased seller-provided closing costs will likely cut new home demand between 5% and 10%.
Jobs. Employment has to improve. People without jobs don’t buy houses.

I don’t mean to end the week on a downer, and I feel we have to look at what is going on carefully. It would be my very greatest plesure to write a post surrounded by wonderful dancing leprechauns–I am going to look for good news and there will be some soon, I’m sure.

Need someone to answer your real estate questions? That is one of the things I do best–just call me. My direct dial is 312-981-2360 cell is 312-607-1306. And there is always e-mail.

Here are a few posts you might find helpful:

Home Affordability–A Balancing Act

Before You Buy A Condo . . .

Kid Gloves Not Mittens For Today’s Buyer

PATIENCE IS A VIRTUE

Ruth Karel — Thu, 18 Feb 2010 20:30:23 +0000

You are all probably bored to tears with my constant entreaties to buy now and use the tax credit. I am sure that you should BUY NOW–carefully and patiently. Especially if you are a first time-buyer–be patient. Don’t buy on impulse. Blessedly, for buyers these days there is enough inventory that you don’t have to buy on the spot. This isn’t the greatest picture for sellers–and that’s just fine. Here are some ideas that might help you with your home purchase. What they amount to is patience and education.

Do some preliminary searching on line–to help you understand what is out there. This will not give you a thorough understanding of your market–that is your Reactor’s job.
Even if you “fall in love” with a home, don’t buy it the first time you look at homes.. This sort of purchase seldom turns out well–take your time.
Be sure you are working with an experienced agent who knows well the area that you find most desirable.
Let that agent educate you about the neighborhood or building that suits you best.
This education doesn’t have to take a long time–you can probably feel comfortable with the market and the area in just a few times with your Realtor.
Have your pre-approval in order.
Go over closing costs with your Realtor–they do add up and can influence how much you can spend on a home.

What will such an “education” do for you?

You will know the perfect home when you see it.
You will have your financing in order along with a realistic idea of what you can afford, including closing costs.
Let your Realtor help you with setting a beginning purchase price and with advice about counter-offers–after all you chose this person because you felt they were going to do a good job for you.
Buy that wonderful home and enjoy it knowing you did a good job.

HOME AFFORDABILITY–A BALANCING ACT

Ruth Karel — Wed, 17 Feb 2010 20:40:00 +0000

Home affordability is a balance between the price of your new home, taxes, home owners association fees, and mortgage rates. Any one of the parts of the equation affects all the other parts. If you are waiting for the very bottomest bottom of the price decline, remember that a 1 per cent rise in mortgage rates will offset a 10 per cent reduction in the price of a home. Many mortgage brokers predict a rise in the rate of 30 year fixed loans from 5.2 per cent in the first quarter of 2010 to 5.7 per cent in the fourth quarter and many brokers feel that the 30 year fixed rate will go to 6.2 per cent by the end of 2011.

Larry Steinway recently published an article about the effect rising consumer confidence has on home prices–a major piece of the affordability puzzle.Larry feels that even though consumer sentiment has been rising since last February and is now at a two year high, jobs are linked to consumer confidence that. As confidence rises so do mortgage rates and home prices. This is just another example of how jobs are connected to everything else in our economy up to and including our new home. To read all of Larry’s article, just click here. Price is not the only, only, only factor in determining a home’s affordability for you.

Still have questions about moving up or buying a new home? Please call me–312-981-2360, direct, 312-607-1306, or e-mail. I have twenty plus years in Chicago real estate to share with you!