We've done average apartments. How about average condos?
Second verse, same as the first.
A few weeks ago I did a little overview of what the average Chicago apartment looked like. It was pretty popular. But my office is on me for material that they can promote from their new social media campaign, and they're not so pleased with all the rentals that I do. (They are a residential sales brokerage, after all. They want me selling stuff, not renting it. Hint hint.) So, we're going to do the same thing with condos today as I did with rentals before - find the profile of the average condo and then pick out a few from the recent sales bin to show you what they look like.
What's the point? Well, if these are all hovering around the median price point for recent sales, then you can reasonably expect to find something comparable at or around this price in the immediate future somewhere in Chicago. Prices have started to tick upward, especially at the lower end of the spectrum, so we may not see this as the average for much longer. More importantly, this serves as a historical snapshot of what the average Chicago home buyer could afford to purchase in 2012. (more…)
From my browser to yours comes the 2nd installment of the StrawStickStone weekend links!
- Journey to the center of the earth: MentalFloss (a personal favorite of mine) ran an excellent article this week about air rights and underground rights for homeowners.
- Introducing "Generation Rent." HuffPo has a great article about the surge of young adults who are moving to/staying in the city and choosing convenience & renting over the suburban homeowner lifestyle. Faced with uncertain career prospects and rising energy costs, the foot-friendly cities are giving rise to a new generation with very different cultural values.
- Why yes, Realtors can help with Rentals. A recent "Real Estate Matters" column from the Tribune serves as a great reminder that Realtors are in the housing business, not just the home sales business.
- What's included in your mortgage's APR? I had a great conversation with one of our office's in-house mortgage lenders this week about the hidden fees that can be rolled into your mortgage. Sometimes those fees can mean the difference between a good loan and a great one. Find out what makes up the difference between your interest rate and your APR with some guidance from AmericanLoanSearch.com.
- Early property tax bills in the mail for Cook County. Cook County Treasurer Maria Pappas has announced that 2nd installment property tax bills for 2011 will be in the mail this month and due August 1. In previous years the bills have always been late, with due dates sometime in the fall. The bills have been late for so long, in fact, that most bank have come to expect an October or November due date, as have most title companies. This sudden burst of punctuality will mean that most escrowed property tax accounts will come up short, and that any property tax prorations included in home sales for the first half of this year will have been incorrect. Stay tuned for StrawStickStone's take on the mess this coming Wednesday, but for now find out more at the Sun-Times article.
- Rowing for cancer survivors. A former tenant that I placed in two apartments is on a quest to fund her non-profit. Jenn Gibbons is founder and coach of Recovery on Water, a Chicago based not-for-profit rowing team for breast cancer survivors. Jenn formed the group in response to research that physical activity helps reduce the chance of breast cancer recurrence. This summer she is rowing the circumference of Lake Michigan solo to help raise money for ROW. Follow her adventure and make a contribution to the cause at Row4row.org.
Do you have a link to a real estate or Chicago-related item that you'd like me to share here? Let me know!
Many of you reading this blog are saving up for a down payment, security deposit, cash purchase of investment property, or a similar major expense in the near future. With slim paychecks and rising expenses it can be difficult to squirrel away the recommended 20% of every paycheck.
When I transferred from property management to brokerage I knew I was going to take a pay cut for a while as I rebuilt my business. Here are some of the things I've done to cut my expenses. Maybe they'll work for you, too.
Don't pull your scores - real FICO scores are expensive. But definitely check your credit report.
Check credit reports regularly. You get one copy of your report from each of the three credit bureaus every year. I usually pull one at the start of the year, once over Memorial Day weekend and once over Labor Day weekend. The dates go in my calendar. The FICO credit scores are not free. And the Scores offered by many of the "free" credit score websites that have popped up lately are not FICO scores. They use a different scale. The free reports you can obtain through annualcreditreport.com are just a list of your open accounts, but for checking accuracy that's all you really need.
My Cost: $0 and 15 minutes. My Savings this year: $0, but I learned that one old collection account had dropped off of my report this year.
- Call insurance companies annually. Did you know that health insurance plans since the beginning of the year have had to cover preventive care 100% before your deductible? Do you even remember what your car insurance deductible is? It's always good to check with each of your insurance providers annually to find out if you can get a better rate. That goes for homeowner's/renter's insurance, business liability insurance, landlord umbrella policies, car insurance, and health insurance for the self-employed. You won't always get cheaper insurance if you call, but it's always worth the effort.
My Cost: $0 and 25 hours. My Savings this year: $75 in car insurance plus $5580 in health insurance plus $120 for annual checkup now covered by insurance.
There are other sites out there that allow comparison shopping but they're owned by corporate entities. Plug In Illinois is the state-sponsored site and likely to be more neutral.
Switch electricity suppliers. Hey Chicago! You don't have to get your power from ComEd. You don't. It's worth looking into other options, especially if you have central AC. New carriers in the area offer lower prices. Investigate your options at the Illinois Commerce Commission's "Plug in Illinois" site.
My Cost: $0 and 45 minutes. My Savings this year: About 5% off my bill plus the good feeling of knowing that my electricity is now coming from renewable sources.
- Track cell phone usage. Do you know how many minutes are on your cell phone plan? How about the date when your contract expires, if you're on a contract? When was the last time you used all of your minutes or text messages? Have you been with your cell phone provider long enough to earn a new phone? Do you not know? Maybe you should check. It's especially useful to track your voice minute usage and make sure your plan suits your current lifestyle.
My Cost: $30 for a new smartphone last year. My Savings last year: No savings but I got a phone and a mobile broadband router for the same price I'd been paying for just voice service on my old carrier. (I'm on a 2 year contract so I'm holding tight on this until next year. The expiration date is definitely in my calendar!)
- Appeal property taxes regularly. I've discussed this at length in a prior article about property taxes. You get a window for appealing your taxes every 3 years, and under certain circumstances you can appeal outside of that window. If any home similar to yours has sold nearby you in the past year, it's worth trying to appeal your taxes based on their sale price.
My Cost: County filing fee. My Savings this year: About $200/mo.
- Always get multiple estimates. Calling around for estimates can be annoying and you always feel like you're being a pill. However, you learn in the process about the task at hand, and businesses that won't provide an estimate are not going to remain in business very long. Treat your bank account like it's a business operating account. Allow yourself a certain amount of petty cash for expenses, but if a purchase will require more than your petty cash allowance then go do the proper research.
My Cost: $0 and a few hours of time. My Savings this year: $500 on a dental treatment and $700 on an exterminator.
Chicago's got some of the best water in the world. (Lake Michigan photo by John Chimon)
Learn to love ice water. Beverages cost more than food. This is true for most restaurants, and especially for alcoholic drinks. Pop & sugary juices are not healthy either. With the exception of my morning coffee (homemade, french press, black) I stick to ice water from the tap for most of the day.
My Cost: My portion of the water bill in my monthly assessments. My Savings this year: At 20 cents per can of soda, at least $113.75 so far this year, plus the wear and tear on my pancreas.
- Shop slowly. This started with my mother's habit of carrying items around with her in the store as a "test drive" before purchasing. She generally does not make a purchase unless it's on her shopping list or she's toted it around with her in the store for a while. In my case I use my 2 week "Do I need an Ipad" test on pretty much all of my major purchases before I even walk into the store. Mom has picked up on this test and was recently using it herself. She's quite the frugalista, so I'm very pleased.
My Cost: Quite a bit of time doing research. My Savings this Year: At least $700 on an iPad, $200 in unnecessary clothing & shoes, and $80 in makeup.
Be nice. Win stuff.
Buy low, tip high, stay consistent. I don't want my thriftiness to hurt the individual workers. I want them to be able to afford to go shopping too. Tips are 100% take home for the laborers, while unit cost is retained by the corporation. Whenever possible, especially in the service industry, I make sure to tip high and I frequently reap the benefits if I'm a returning customer.
My Cost: Minimal. My Savings this Year: At least $80 in free beers from grateful bartenders, plus $30 from being able to go longer between manicures.
- Refinance the mortgage. Much like insurance, you won't always win on this one. However, as long as mortgage rates stay below what you currently have and you stay on top of your credit score, you have at least a shot at a successful refinance of your loan. This is the one scenario where the cost may outweigh the savings. Make sure you run the numbers before you go ahead with the refi. Check with a different lender at least once a year, or once every 3-5 years if you recently refinanced.
My Cost: About $700 in 2010 for a HARP refi. My Savings: About $28k in interest.
Do you have a money-saving tip to share with us? Let me know in the comments!
I have personally never appealed my property taxes although after writing this article I intend to give it a try at my next opportunity. You've got really good odds of saving a chunk of change. The average Cook County appeal lowers property taxes by about $395. But there's so few people taking advantage of it! I know - it sounds like an annoying and scary thing to do with lots of red tape. That's why I haven't appealed either. I will hopefully remember to write up my experiences as I do so. If you've ever done it yourself please let me know in the comments about how it went for you!
In the meantime, it's Friday, which means it's stats day here at StrawStickStone. I'm a big fan of Harper's Index so here's a little Harper's style breakdown for you to ponder.
Property Tax Appeals
- Chances of a successful individual property tax appeal, 2007-2010: 75%
- Approximate percentage of Cook County homeowners who appealed: 5%
Illinois Lottery Scratch Tickets
- Percentage of players who break even on a $2 ticket... 22.6%
- Percentage of Americans who think scratch tickets are a practical way to get rich.... (more…)