"DISTRESSED OUT" Dealing with short sales and foreclosures in today's market

"Distressed Out"
	Dealing with short sales and foreclosures in today's market		JUNE 2012
	Let's say you were a conservative, responsible homebuyer back in 2006, and made what, by all accounts, would be considered a conservative, responsible down payment of 20%. Since then, the average home price across Chicagoland has fallen by more than 30%, according to conservative estimates. Conservatively, that means a lot of homeowners in Chicago are "underwater," i.e. the balance of their mortgage is greater than the equity in their home. Watch the @properties Market Minute: Inventory is down and markets are stabilizing. Click on the video to learn more. In fact, the real estate website Zillow.com reports that 41% of homeowners in the Chicago metropolitan area were underwater in the first quarter of 2012. No longer a stigma or symbol of overextended credit, negative equity is a fact of life across every economic tier, in every neighborhood and town, from the West Side to Winnetka. Yet life marches on. People change jobs, start families, decide to downsize - and need to buy and sell homes. Whether you're a seller who can't wait out a full market recovery or a buyer interested in short sales or foreclosures, @properties is here to help. Here are some tips for buyers and sellers in the short sale market: For sellers: • Successful short sales are a team effort. In addition to your broker, it is highly recommended that you hire an attorney experienced in short sale negotiations. • Short sales take longer than traditional sales. Be prepared for an intensive process, even if the bank has already approved a selling price. • Be thorough and timely with required documentation-- such as a seller's hardship letter, tax returns, W2s and financial statements -- to expedite the process with your bank. • A short sale does not necessarily preclude you from buying another home in today's market. There are circumstances in which sellers can purchase anew in a relatively short amount of time. For buyers: • Even in the case of a short sale, your offer needs to be priced near market value since a seller's bank is unlikely to accept an extremely low offer. • Have your mortgage approval ready. Lenders typically want a buyer to close within 30 days of acceptance of an offer. • Do an inspection before approval of your offer. That way, you won't waste time waiting for the green light on a deal you'll ultimately walk away from. • To avoid unnecessary delays, have your agent find out if the listing agent has received the completed short sale package from the seller. • The seller's lender may not give standard credits for prorated taxes or other common items at closing, but the discount you're getting should more than offset these expenses. Please count on me for sound guidance on distressed property transactions or any real estate need. Your trust and referrals remain my highest compliment. Thank you.
	Office Locations: River North Lincoln Park Lakeview Gold Coast Bucktown Evanston Highland Park Winnetka Lake Forest

2012 Chicago Festival Schedule

	Office Locations: River North Lincoln Park Lakeview Gold Coast Bucktown Evanston Highland Park Winnetka Lake Forest
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Multiple Offers Are Back

Multiple Offers Are Back
	How to survive a bidding war		MAY 2012
	One of the biggest stories of the spring 2012 housing market is the return of multiple offers. It's not the frenzy of 2005, but right-priced homes are seeing heavy action right out of the gate, and many people are surprised to find homes going under contract above list. What should you do if you find yourself in a bidding war? Here are a few tips. Sellers: • The highest offer isn't always the best offer. After enduring years of falling home prices, it's tempting to automatically accept the highest bid. But these days you also need to take a hard look at a buyer's ability to close. Weigh factors such as finance contingencies, earnest money and closing date. In the end, choosing the right buyer is just as important as choosing the right price. • Move quickly. While the market is heating up, it's still incredibly fickle. Respond to offers quickly, and once the terms are to your liking, get a contract signed ASAP. The longer a negotiation drags on, the more tenuous it becomes. • Maintain your objectives. Sure, all things being equal, you'll take the highest price you can get. But if your target price was "X", don't all of a sudden set a new target of "X plus Y". "X plus Y" has a nasty habit of turning into "X minus Y". Stick to your game plan, and be happy when it succeeds. • Foster a feeling of equity in negotiations. A person is likely to walk away from a negotiation when they feel they've lost control. This is important to remember, even in multiple-offer situations. While you may have the leverage, it's important to keep a buyer engaged and avoid ultimatums. Buyers: • Start with your best offer. If you know you're going into a multiple bid scenario, write your best offer from the start. • Earnest money can make a difference. Increase your earnest money deposit to show the seller you are serious about closing and will not back out of the transaction. • Pre-approval is a must. A mortgage pre-approval (or proof of funds for cash buyers) is a necessity. Shopping for a home without pre-approval is an exercise in futility in today's market - multiple offers or not. • Find out what's important to the seller. Ask your broker to find out the seller's hot buttons in the transaction. Maybe they're willing to accept a slightly lower price for a fast closing or an "as-is" contract. • Waive contingencies. Depending on the condition of the home, your finances and/or the state of your local market, it may make sense to waive certain contingencies, such as a home inspection or mortgage financing. We should discuss this strategy at the outset to make sure you are comfortable with it. Preparing for multiple-offer situations ahead of time, can make the process much less stressful and give you the edge you need to succeed. Contact me anytime, and remember I always appreciate your referrals. In the news: Emanuel says O'Hare cargo center will create thousands of jobs Military land at O'Hare Airport acquired by the city in 1996 for private development that never happened will finally get the international cargo center that former Mayor Richard M. Daley envisioned when he made that $104 million investment. More Mortgage rates fall to new lows again Average rates for 30-year and 15-year fixed mortgages fell to fresh lows this week. Cheap mortgage rates have made home-buying and refinancing more affordable than ever for those who can qualify. Mortgage buyer Freddie Mac said Thursday that the average rate on 30-year loans ticked down to 3.83%. More Multiple bids? Housing market showing signs of life Karen Boguslawski was stunned when she started getting competing bids for her home in Chicago's Edgebrook neighborhood, resulting in a 12-day race toward signing a contract with a buyer. "I was completely shocked when I had a scheduled showing within a couple of hours of it going on the market"

Spring in your step?

Spring in your step? Consensus gathers around improving market conditions APRIL 2012 Wondering why folks seem to have more of a 'spring in their step' this spring? Sure, the warm weather started unbelievably early and we barely saw winter. And yes, tax season is officially over. But one of the biggest reasons to smile in 2012 has been the activity of our local housing market. Chicago real estate has been extremely busy since the New Year and shows substantial signs of promising longterm improvement. That's right. It looks like there's a little less caution and a bit more optimism in the 'cautiously optimistic' outlook of late. Borrowers, for instance, are smiling. Capital Economics, a leading independent research firm, reports that banks are making credit available to more buyers, lending amounts up to 3.5 times borrower annual earnings. Banks are also loosening loan-to-value ratios (LTV), now lending at an average of 82% LTV vs. the mid-2010 lows of 74%. Homebuyers are smiling. Releasing its winter 2012 'Rent vs. Buy Index,' Trulia reports that in 98 of America's top 100 metropolitan areas, including the city of Chicago and Lake County/Kenosha, owning a home is more affordable than renting. Key factors include low home prices, rising rents, and record low mortgage rates, still around 4% for 30-year fixed products. Builders are even smiling. In late March, the Urban Land Institute released its real estate forecast for the next three years, with encouraging trends in both the residential and commercial building sectors through 2014. The panel estimates that single-family housing starts will jump from 428,600 in 2011 to a projected 800,000 in 2014. As demand improves, home prices should follow. ULI CEO Patrick Phillips says, "what we see in this survey is confidence that the U.S. real estate economy has weathered the brunt of the recent financial storm and is poised for significant improvement over the next three years." (www.uli.org) And yes, REALTORS® are smiling, too. Helping you achieve your real estate goals puts the spring in my step every day. Count on me to continue to provide my highest level of service and attention, and thank you for the trust of your referrals.

On The Go

On the go
Keeping busy this spring with new innovations, initiatives and trends MARCH 2012

Going... Going... Mobile - @properties is excited to introduce our new mobile website, which makes finding your next home easier than ever. Just log onto www.atproperties.com from your smart phone, and information for any home in the MLS is just a couple of taps away. Use @properties' mobile platform to:


• Search by price, property type and number of bedrooms and baths
• View photos and property descriptions
• Find homes and open houses within a radius of your current location
• Track current market conditions with Neighborhood Market Reports
• Search without downloading an app
• Use any smart phone operating system including iPhone, Android and Blackberry



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Going... Going... Green - The early arrival of spring isn't the only reason things are looking greener at @properties. We are also making strides to reduce our company's impact on the environment. Five @properties offices will soon run on 50% renewable energy, and we're launching a pilot program to increase the energy efficiency of our office lighting. We are using less paper, relying more on sustainable office supplies, and aiming to recycle more than 75% of our office waste. In addition, more than 100 @properties brokers have completed advanced training for their National Association of REALTORS® NAR Green Designation. Looking for more ways to go green at home? Check out these web sites:


• http://environment.nationalgeographic.com/environment/green-guide
• http://greenlivingideas.com
• http://www.goodhousekeeping.com/home/green-living



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Going... Going... Up? - Interest rates on 30-year fixed rate mortgages have been below 4% for three months but now could be trending up. Last month's positive employment numbers lifted rates from their historic lows. Still, rates are roughly three-quarters of a point below their year-ago levels, making now a great time to take advantage of "cheap money." The combination of today's low rates and low prices give qualified buyers exponentially more purchasing power than they had a few years ago. So far that's translating into much greater showing activity this spring market.

No matter where you're going, please remember to include me in your real estate plans. Thank you for the continued trust of your business and referrals.

Raising the Bar

Innovation Drives @properties' Growth

FEBRUARY 2012

We're successful when you're successful. @properties looks back on a very successful 2011 and looks forward to an even better 2012.

Gaining Market Share
@properties finished 2011 as the #1 brokerage firm in Chicago for the third straight year, with a 13.6% share of the city market. Our Lincoln Park and Bucktown offices were #1 and #2 in the city respectively for total sales volume. On the North Shore, @properties nearly doubled its sales volume from 2010 (+82%) and has become the second largest North Shore brokerage firm just two years after entering the market. With over $256 million in sales, our Winnetka branch had the highest sales volume of any single North Shore real estate office.

Outperforming the Market
@properties' innovative sales, marketing and technology initiatives also helped our clients sell their homes faster and for a higher percentage of asking price than the competition. Among the city's largest brokerage firms, @properties ranked first in two key efficiency measures: average days on market (166) and percentage of selling price to original listing price (92%). Meanwhile on the North Shore, @properties sold homes 43 days faster than the market average (144 days vs. 187 days), and our selling-price-to-original-listing-price ratio of 89% was also #1 among any firm with at least $150 million in annual sales.

Always Improving
With over 20 seasoned agents in place, @properties opened the doors to its Lake Forest office on Feb. 3. This spring, we will continue our North Shore expansion with a new, state-of-the-art office in downtown Highland Park. But now more than ever, real estate business is also conducted from the car, the coffee shop and the sidewalk. That's why @properties has introduced new mobile technology to make shopping for a home more convenient than ever before. Meanwhile, our new Seller Reports will keep home sellers apprised of key information, including web activity and market conditions, relating to their property.

As the real estate market improves, @properties will continue to enhance our industry-leading Internet, print and grassroots programs to serve you better. Your success is our success, and we are working extremely hard every day to help you realize your real estate goals. With utmost gratitude for your business and referrals, here's to a successful 2012.

Keeping It All Together

Foresight and communication can prevent deals from derailing in escrow. JANUARY 2012

Sometimes life is about the journey; sometimes it's about the destination. In the world of real estate, it's about both. One crucial part of the real estate journey that gets relatively little attention is the period between contract and closing, known as escrow. These days, escrow is a minefield of below-market appraisals, mortgage madness, buyer/seller remorse and renegotiation.

A National Association of REALTORS® poll from last June found that one in six agents (16.7%) said they had a deal fall apart in escrow, and AOL Real Estate reported that 32% of buyers either canceled their contracts or had to delay a closing or negotiate a lower price because of appraisal issues.

It seems the true test of a real estate professional in 2012 isn't whether we can bring a deal together but whether we can keep it together. Here are some tactics a good REALTOR® will employ - both before and after a contract is signed - to help you avoid the pitfalls between contract and closing and ease your journey to a successful purchase or sale.

• Pre-listing inspection: Inspections aren't just for homebuyers. In some cases, they can also serve as a preemptive measure for sellers. Ordering an inspection before putting a home on the market can allow a seller to identify and address issues that could otherwise scuttle a deal.

• Appraisal management: Overly conservative appraisals are the norm these days. So a good agent will make sure an appraiser is using valid comps that support the contracted selling price and pre-listing CMA research.

• Contract administration: Proactive, detail-oriented contract admin is paramount to closing deals today. @properties has a team of experienced contract administrators who monitor contingency dates, make sure earnest money is collected, and work with attorneys and title companies to keep transactions moving toward the finish line.

• Communication: A good REALTOR® will keep in close contact with all parties to a transaction to avoid surprises and keep small issues from becoming big ones.

Good salesmanship is as important as ever, but the ability of your agent to anticipate and deal with obstacles is ultimately what will help you reach your real estate destination these days.

On a separate note, @properties' Luxury Collection Magazine: Winter 2012 edition is now live at www.atproperties.com. Click on the ad to the right to view the city's best luxury listings.

Contact me with questions about the current market or your specific needs, and if you know someone who is looking for a REALTOR®, please let me know. Your trust, confidence and referrals are the highest compliments I can receive.

Happy New Year!

Ballpark Figures

Ballpark Figures
Online home values often come out of left field DECEMBER 2011

About the only online segment growing faster than Cyber Monday sales might be real estate search websites such as Zillow.com, Realtor.com and Homes.com. One reason for the huge gains in web traffic (the above three sites now draw approximately 50 million unique visitors per month - and growing) is the home-valuation tools many of these sites offer. Resources like Zillow.com's Zestimator have become the first place many consumers turn in order to gauge the value of their own home or one they're considering buying.

Online value estimators are certainly interesting and more than a little entertaining. But they aren't the best way (and, in many cases, not even a good way) to get an accurate picture of a home's market value. A recent article in The Wall Street Journal pointed out that online home valuation models can "veer off target with alarming frequency." And most of the websites themselves acknowledge the potential for inaccuracies.

For example, Zillow features an accuracy table that rates the site's pricing estimates for major metro areas on a scale of one to four stars. Chicago is a three-star market for accuracy. The site claims that 78% of Chicago-area Zestimates fall within 20% of the actual sale price, and there is an average margin of error of 7.9%. Of course, that's for the entire metro area. What do those stats tell you about the accuracy of price estimates in your town, your neighborhood or your block?

To put it another way, if your real estate agent told you that slightly more than one in five of their pricing analyses missed the mark by 20 percent or more, you'd probably go out and find yourself another agent. Which begs the question... Why not call your agent in the first place?

If Zillow can give you a "three-star" guesstimate of your home's value, then a full-service professional REALTOR®, who's working from up-to the-minute MLS data, walks through dozens of homes each month, and has knowledge of those homes that can't be found in the public record, is probably worth five stars at least!

Of course that's not to say these websites and their home valuation models aren't relevant. Full disclosure - @properties advertises on many of these sites because we do recognize their value to the consumer. Sites like Zillow, REALTOR.com and Trulia have invested millions of dollars in developing excellent search technology. And it's important to recognize that online valuation tools are new. Algorithms are constantly being updated, and the better sites encourage participation from their user communities to acquire more data on individual homes. Over time, online valuation models can only get better.

Ultimately, however, the best estimate of your home's value will come from a professional REALTOR®. And you don't have to be buying or selling right this minute to get that information. I'm happy to provide an informal estimate or a thorough comparative market analysis anytime - even if you're just curious. Just pick up the phone and call me, or send me an e-mail or text.

On a final note, let me take this opportunity to wish you a very happy holiday season and a joyous New Year. I value our continued relationship and I'm grateful for your support. If I can be of assistance to you, your family or friends in 2012, please let me know. And remember that I always appreciate your referrals.