The decline of the real market isn’t all bad. In fact, for those of you with good credit and some savings, right now might be the best time to purchase a Chicago condo or Chicago home. The Chicago Tribune recently highlighted five reasons to buy, which are as follows:
1. Lots to choose from – Right now, the amount of available Chicago homes for sale is well above average. You’d certainly have your pick of the litter—a buyer’s dream. As the Tribune reported, almost 85,000 Chicago homes and Chicago condos were listed on the market as of early May, which doesn’t include for-sale-by-owner properties, builders offerings and foreclosed homes that haven’t been listed into the MLS yet. So if in the midst of your search you suddenly decide that black marble countertops imported from Italy are the only way to go—don’t worry—chances are you’d have more than enough options to choose from.
2. Oh, the savings – Sure it’s tacky to profit off of the misfortunes of others, but the current economic crisis has led to some amazing bargains in the Chicago real estate market. In March, the median price for a singe-family home in Chicago was $194,000, a decline of 22 percent from the previous year.
3. Time is ticking – Everybody and anybody is speculating when the downward fall of the market will end. While it’s hard to predict exactly when the Chicago real estate market will come back, recent data suggests that it’s on the rise. “For example, the number of homes under contract in west and south suburban areas was up 27 percent in March, the fourth consecutive month showing a year-over-year contract increase, according to the Main Street Organization of Realtors, which pronounced it an ‘upward trend,'” the Tribune said. So strike while the iron is hot and purchase a Chicago home before prices and interest rates go back up.
4. Holy tax incentives, Batman – Uncle Sam is giving deals for first-time home buyers who close on a primary residence before December 1. These buyers qualify for a 10 percent tax credit of the purchase price, up to $8,000. This extends to those who haven’t owned a home for at least three years. Information can be found at federalhousingtaxcredit.com.
5. Low interest rates – Low interest rates are rare, but in this economy, 30-year, fixed-rate loans are going for 5 percent. They’ve even gone as low as 4.8 percent in the last few weeks.
What about the luxury buyer? – While some of these reasons apply solely to first-time or mid-level buyers, luxury buyers can also get a great deal in the current real estate market. Although money is tight, jumbo loans (loans over $417,000) can still be negotiated through banks with a 25 to 30 percent down payment.
To get a great deal, luxury buyers who choose to be aggressive can negotiate with Chicago developers for new construction homes by offering the seller cash. Or, by eliminating the mortgage contingency in the initial offer, and by closing in 30 days or less. Buyers can get a luxury Chicago home at a much lower price with these types of negotiations, which sellers generally like. However, keep in mind there is some risks involved, so be sure to discuss them with your real estate agent and mortgage broker.