John D Ambrogio

Judging by the excited chatter on my airplane right now - Relocation professionals around the country are excited about the future of relocation in general, and Chicago in particular.

Flying out of O’Hare to conferences is always interesting - It’s a big “connecter” location and I’ve got colleagues from both east and west here changing planes to head down to The Relocation Director’s Council and The Employee Relocation Council’s Spring meetings in sunny Orlando FL.

Says on professional “initiations are up, buyers are optimistic, and sellers are REALISTIC.”  Says another - “We’re seeing corporations understanding that there is a pent up demand in the Chicago market, and  many others, to get the right people to the right location.”

Encouraging news for the professional (or civilian) with the need to  move in today’s market.

John D Ambrogio

Some comments from our own Maija Harjula - A while ago I read an interesting article in Crain’s Chicago Business about the shape of Chicago real estate markets. Alby Gallun’s article Chicago Housing Market Won’t Recover Until 2013 takes a quite pessimistic stand on where the real estate market is standing right now. In the article Perry Bigelow and other featured experts pretty much smash the idea of our recovering housing market.

It really is an interesting piece where Gallun discusses Chicago-area housing, foreclosures and the future. But what this means to Chicago relocation? We all know that the economy isn’t going to recover overnight. How do you feel about 2010?

Gallun writes that 95 000 units are expected to sell in 2013 – it’s still far from the numbers we had in 2005 during the boom’s peak, way over 100,000 units. I have a feeling that it might take a while to get up to those numbers again. According to Bigelow there’s no reason to be optimistic — what do you think? Like Gallun’s quoted expert Geoffrey Hewings, director of the Regional Economics Application Laboratory, says the Chicago real estate will need some serious signs of economical recovery before starting to climb up itself.

I hope you take a few minutes to read it (you can do it here!) and if it happens that you don’t agree with it, at least it’ll give you something to think about. I personally found the article very interesting but for me a little optimism is never a bad thing.

John D Ambrogio

The Chicago Tribune’s real estate writer Mary Umberger shared her thoughts about Chicago real estate and the current market conditions. Mrs. Unberger’s article “Market Turnaround or Numbers Game?” also featured Baird & Warner’s Jim Kinney, the Vice President of Luxury Home Sales. Read the whole article here.

John D Ambrogio

Mary Ellen Podmolik wrote a great article in the Business Section of Today’s Chicago Tribune (read it here) discussing how distressed properties are helping to redefine our market.

I’ve spoken on the subject often (as well as in this article) and it is amazing in the last two years how much of an influence the REO and short sale world has had on Chicago Real Estate.  As quoted in her article, the median price in our dear Chicago has gone down 1/5 - to $176K from $225K.  Truly a market correction. 

As a transferee to Chicagoland, the time has never been better.

John D Ambrogio

From our intern, Maija Harjula -

After launching our foreclosure search about a month ago the traffic to www.bairdwarner.com has soared. When foreclosed properties are a big deal these days and consumers are provably using it, make sure that you know how to take advantage of our great search tool!  As a transferee relocating to Chicago, even in the luxury market, it’s important to understand how foreclosures and shortsales affect the underlying value of property.

Read Inman’s article here -  John D’Ambrogio, CRP, vice president of strategic development for Baird & Warner, is quoted as saying “The foreclosure transaction is vastly different today than it was five or 10 years ago. Years ago only a few people specialized in these transactions.”  Take a look at the tool, which shows all foreclosure activity on MLS properties, through an exclusive arrangement with a provider of local data.

John D Ambrogio

How do you get people to search for your home when the searches “foreclosures” and “search free foreclosures” are at historical record highs?  Information published by both Hitswise and The Wall Street Journal indicates that those searches have reached their highest levels in years. 

Well, while less people are searching luxury real estate  these days, those who do are serious about buying. So the same rules apply - make sure you have descriptive listings of your property; use a Realtor who will promote your listing with e-blasts to potential buyers, agents AND potential buyers.  Also make sure the have a luxury real estate network affiliation that can help drive those buyers to you.  Those buyers are still out there, you just need to know how to market to them!

www.luxuryportfolio.com

John D Ambrogio

Some comments from our resourceful intern, Maija - This is the time when many people are pondering over whether to buy or rent a property. While great amount of prospective buyers are deciding to rent there is also some encouraging facts that support buying. Forbes Magazine just published an article Ten Cities To Go From Renting To Buying where top10 areas to buy are listed. It’s definitely good news for Chicago relocation as we can be found in the third place.

In short, think how much money you pay for your rental and compare it with the amount you’d pay for mortgage each month. At the moment the premium is way smaller than the average of the past 15 years. And the areas that made to the top 10 are the places home prices are going to climb the most in the next 5 years according to Forbes.

Basically this means that in these areas it is cost-effective to buy a house instead of keep paying rent. Maybe it is a good time to upgrade — especially since many of the prospective buyers could benefit from the extended first-time home buyers’ tax credit.

John D Ambrogio

A recent report by TransUnion, the credit-scoring giant, has some stunning information that really helps crystalize the way many people look at their homes today.  According to TU, since the recession really got going, the old concept of “mortgage payment first, credit and other payments second” has gone tipsy turvey - People are paying the credit card payment and THEN, if there is anything left over, they are paying their mortgage.  A “hierarchy reversal” as they call it.

Does that mean that people no longer care if they lose their home; that their concern is more about keeping available credit open; or that they don’t see logic paying down an asset that is worth less than the balance?  Whatever the reason, TU predicts that this is a temporary change, and the world will go back to normal as we come out of this economic climate.  For the sake of Chicago real estate, we hope that happens soon!

Still…..interesting food for thought!

John D Ambrogio

My longtime colleague Jim Kinney was interviewed today for Mary Umberger’s real estate colum in the Chicago Tribune.

In it she describes (as your humble author has done many times before) that traditionally the “spring season” starts the weekend after the super bowl (some big football game, I’m told).  However, given the unique market situation in Chicago and other parts of the country, she feels that we’ll be starting a bit early this year - She quotes Kinney ( vice president of luxury home sales for Baird & Warner  ) as saying “We’re going to see a lot of property coming on the market; we’re going to see everything that people took off the market in the fall, knowing they were going to be back in the spring in order to qualify under multiple-listing service rules as “new” listings” (a little trick realtors play on a regular basis).

Kinney still warns us about, as Mary Umberger puts it - the “danger in relying too much on what the guy down the street is asking.”

Kinney adds - “An awful lot of listings are wrongly priced. If people use those as a guidepost, they could get into trouble. Do a combination of historical data (houses sold no longer than six months ago) and looking at who you’re competing against, once you’ve determined whether they’re valid prices.”

I’ve known Jim for a decade and he’s been pricing properties correctly for more than twice as long.  Have a listen to what he has to say…