Bad News for Some...Good News for Some

Home prices take biggest dive

Survey finds 6.7% falloff in U.S.; 3.2% Chicago-area decline

By Susan Diesenhouse | Tribune staff reporter

December 27, 2007

With fewer buyers and a bulging supply of newly built houses, residential sale prices fell nationwide in October for the 10th consecutive month, posting the biggest monthly decline since these numbers were first compiled in 1988, according to the Standard & Poor's/Case-Shiller home price index.

The record 6.7 percent drop marked the worst falloff in same-house sale prices since the 6.3 percent decline during the real estate recession of April 1991.

"No matter how you look at these data, it is obvious that the current state of the single-family housing market remains grim," Robert Shiller, who helped create the index, said in a statement Wednesday.

Chicago was late to the bubble game, so late she will be to the burst. But burst she will. Chicago has the same bad fundamentals as the rest of the country. Home prices too high for average incomes, and over-supply. Chicago is suffering from the same valuation crisis as everyone else.

Chicago Condo Market in Trouble

Foreclosures on condo projects rise

Is conversion crush an ominous sign?

The condo slump has put developer Liviu Mihulet in a tight spot.

His lender, Northside Community Bank, filed a lawsuit in August to foreclose on a 32-unit condominium conversion the developer launched in January in West Rogers Park. The bank asserted that the property, at 6500 N. Claremont Ave., had declined in value and demanded that Mr. Mihulet put another $500,000 of equity into the project. When he refused, he says, Northside demanded he repay the $3.1-million loan.

"This was an insult," says Mr. Mihulet, who is trying to refinance the project.

It's an indignity more developers are facing. As weak condo sales make it harder to pay off construction loans and skittish banks try to reduce their exposure to the depressed market, condo developers are increasingly facing a fate similar to that of the thousands of Chicagoans who may lose their homes to foreclosure.

That's what happens once most of everybody buys something and the rest of the population cannot afford what's left over.

These People Are...

...Quite Probably THE Dumbest People in Chicago!





THESE people bought a house in the heart of ENGLEWOOD, and are regretting it now. That the boy only got his ass kicked once is a miracle. Now the ass-wooping might cause them to foreclose on their "dream home". Seems more like a nightmare to me....

Foreclosing on a dream

'I WOULDN'T WISH THIS ON MY WORST ENEMY' | Subprime loan and a run of bad luck have left Theresa Adamovitz with mortgage payments that she can't meet

December 10, 2007
BY KARA SPAK Staff Reporter/kspak@suntimes.com
Theresa Adamovitz had one thing to do before putting up her Christmas tree this year: File for bankruptcy.

...

The modest home in the 6100 block of South Loomis was a dream come true for Adamovitz and her then-husband when they bought it in 1997.

...

She totaled a car she still owed money on. Her job switched to hourly pay, costing her $500 in monthly income. Her son got mugged, needed surgery and lost his job. Her ex-husband didn't make his payments on the loan. The adjustable rate mortgage kicked in, jacking up the monthly payment to $1,853 from $1,175.

Buying something in the wrong neighborhood is a bad mistake no matter what.

Thank God, Not in Chicago!!

House prices seen falling 30 pct

By Julie Haviv

NEW YORK (Reuters) - Housing markets from Punta Gorda, Florida, to Stockton, California, will crash and suffer price drops of more than 30 percent before the housing crisis is over, a report from Moody's Economy.com said on Thursday.

On a national level, the housing market recession will continue through early 2009, said the report, co-authored by Mark Zandi, chief economist, and Celia Chen, director of housing economics.

The report paints a worsening picture of the hard-hit housing sector, which is in the midst of its worst downturn since World War II.

Read that again! It says from Florida to California. It clearly says NOTHING about Chicago. We are safe. Everything is fine here. Go buy a condo.

Not Just the Poor

Middle class and out of a home in Chicago

Poorer neighborhoods hit hardest, but wealthy, middle class also squeezed

December 4, 2007
BY ART GOLAB Staff Reporter/agolab@suntimes.com
The home mortgage meltdown isn’t just gutting the poorer parts of town.

It’s beginning to hammer wealthy and middle class Chicago neighborhoods like Lincoln Park, Lincoln Square, Irving Park, Portage Park and Mt. Greenwood — all areas where home mortgage foreclosures have shot up by 100 percent or more from 2006 to 2007.

The home mortgage meltdown is beginning to slam Chicago's wealthy and middle-class neighborhoods.
(AP)

Data released Monday by the National Training and Information Center shows that in Lincoln Park there were 18 homes in foreclosure during the first six months of 2006 — but that number more than doubled to 37 for the first half of this year.

In terms of sheer numbers, poor neighborhoods still are feeling the worst pain. But percentage increase in mortgage defaults is climbing faster in middle class areas, according to the data.

Poverty stricken West Englewood, for example, had 348 foreclosures, or 111 per square mile — yet that was just a 58 percent increase over the previous year.

But in middle class Portage Park, the heart of the Northwest Side Bungalow Belt, mortgage defaults jumped from 32 homes to 94, a whopping 193.8 percent.

Does anyone out there realize that prices went way too far ahead of income??? That is why the foreclosures are jumping. People could not afford the price tag, but they were goeded into stretching too far by the TV flipper shows, the real estate agents, the neighbors, the co-workers, et al. Now judgement day as arrived and they want a pass because they are too gullible.

Freezing the ARMS is a good first step,” said Rose, but he added that lenders should also work with borrowers to permanently change the terms of the loans so they don’t get into trouble again.

Also, government and lenders should to find new, healthier ways to bring mortgage money into poorer neighborhoods rather than just subprime lending.

"And to make sure this doesn’t happen again we’ve got to slap some rules on an industry that has gone virtually unregulated,” said Rose.

Overall in Chicago, the foreclosure rate was 40 percent higher for the first six months of this year compared to a similar period in 2006.

Does this sound about right?

Mr. Fvcked Borrower: Mr. Nanny-State Government! Mr. Nanny-State Government!

Mr. Nanny-State Government: What Mr. Fvcked Borrower?

Mr. Fvcked Borrower: I'm in trouble and I need your help!

Mr. Nanny-State Government: What is it?

Mr. Fvcked Borrower: I can't afford my lottery tick....er, I mean my HOME any more. I'm scared! Tell Mr. Lender to give me a break.

Mr. Nanny-State Government: Ok, Mr. Lender, go easy on Mr. Fvcked Borrower!

Mr. Lender: We know you lied on your lottery tick...er, loan application, Mr. Fvcked Borrower. But that was ok, because we liked the commissions. We will freeze your rate if you promise never to do this ever again. Do you promise never to get in over your head again with debt?

Mr. Fvcked Borrower: Oh, yes. Yes. I promise never to get in over my head again. Thank you sir, thank you.

[Mr. Fvcked Borrower is crossing his fingers behind his back.]

What's Going On Here?

Developer sought for West Garfield vacant parcels

By Jeanette Almada | Special to the Tribune
December 2, 2007

A mixed-use developer is being sought for several vacant city-owned parcels in the West Garfield neighborhood.

City planners at the Chicago Department of Planning and Development on Nov. 19 issued a request for development proposals for any of several lots, most of which are on the 3900 block of West Jackson Boulevard and West Adams Street, and at 201 S. Pulaski Rd.

The city hopes to find a developer who will build residential projects on most of the lots, and a mixed-use project at 201 S. Pulaski. Developers who propose environmentally friendly and energy-efficient projects, and particularly proposals promising to build U.S. Green Building Council LEED-certified projects will receive favorable consideration in the application process, a Planning Department project manager told the Community Development Commission last month.

Ok, I find this really weird. If Chicago R.E. is fine and not under the pressure that other markets are under, then this should not be happening. Having a good idea about how the City works, I find it difficult to believe that NOBODY wants these lots! Things must be really bad if the politicians cannot hand out sweetheat deals to their buddies.