Chicago Condos Market Watch---Is A Better 2010 In Store?
The Chicago condos market suffered a big hit due to the economic downturn. Even the most affordable Chicago condos were not immune from the blow of recession, nothing to mention about the most expensive lots. The last quarter of the past year recorded a dramatic 35% drop in the condo sales. It was particularly bad for the downtown Chicago condos. The pricy condos in Near North Side in Streeterville and Gold Coast also experienced a 43% drop in their sales.
But the new year has brought about a fresh wave of optimism. The builders and developers are clearly upbeat about a better tomorrow. With prices getting stabilized and mortgage rates being slashed and government offering tax incentives for the first time home buyers, owning condos were never so cost-effective. Thus developers expect a fresh influx of buyers in the market in the upcoming days."Owning costs less than renting. Today is an ideal world of affordability because of the low mortgage rates and reduced home prices in the last two years. Pricing has stabilized, and there are opportunities in the housing market that were not affordable before," said Chris Naatz, Midwest director of marketing for Pulte Homes in Schaumburg.
2010 is going to draw a good number of buyers with limited budget, predicts David Smith, vice president of sales and marketing for Cambridge Homes, Libertyville."The government's $8,000 tax credit for first-time buyers last fall created a momentum that helped significantly to get people with limited funds into houses," said Smith.
However the developers are concerned about the government's renewed policies with regard to high value loans which they believe are going to affect the high end condos market. "There are a lot of multimillion-dollar homes for sale. But jumbo loans may be hard to get, even if the buyer is qualified," said a real estate analyst. So it comes as no surprise as Gail Lissner, the vice president of Appraisal Research Counselors in Chicago declares, "There are no new high-rise residential buildings in the pipeline for 2010". There will be 2,800 unsold units in the market---majority of these units belong to the Chicago condos of South Loop area. With financers lacking confidence, it will be tough for the builders to arrange finance for starting new projects. Meanwhile, the developers will concentrate on wrapping up their existing projects and place them in the market for sale.
Given this kind of market conditions, it is going to be most favorable for the buyers, believes the real estate analysts. It all depends on gaining back buyers' confidence and when people start feeling confident about buying Chicago condos they will probably come across their life's best bargains. Then the disaster in stock market is also driving a class of buyers, who think real estate investment is lot less risky than stock markets to Chicago condos market.
Keeping all these trends in mind, we can safely follow the developers in concluding that 2010 is going to be a better year for Chicago condos than the last couple of years.
