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Old 06-27-2010, 01:29 PM
 
829 posts, read 1,150,918 times
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All three of those towns are overpriced to some degree or another. Be sure not to pay the inflated price. If you are not fickle and are open minded about different areas, you can actually get a great deal these days. If you are stuck on Naperville I would wait just a bit longer. Buying in naperville now at these prices has huge dowside potential with no upside potential. Honestly it's best to wait. It will be a long time before naperville sees any significant upside price movement with the expensive unsold inventory in Naperville. These towns all have about the same average household income around $100,000 and are all pretty close to one another. Nothing demographically seperates the areas. Naperville and Oswego are still very overpriced compared to it's household income. Unsold Iventory and mortgage defaults are just building up in those towns. Wait for the prices to come down because they most certainly will. To see what I am talking about take a look at Naperville's neighbor Plainfield. Plainfield is one of those areas that is starting to show the reality already. The housing prices were inflated and are now coming back to earth. There are so many foreclosures on the market in Plainfield. You can get a large cookie cutter new home just a few years old with granite counter tops and all the other thrills in it for under 170k in plainfield these days. But that may not even be considered a deal a year from now if naperville prices take a serious dive. This same home sold for like $400k just a few years ago. It all starts with unsold inventory. In my opinion all three of these towns have alot more downward direction to go.

Last edited by allen2323; 06-27-2010 at 02:35 PM..
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Old 06-27-2010, 04:45 PM
 
Location: Chciago
721 posts, read 1,587,505 times
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Quote:
Originally Posted by allen2323 View Post
All three of those towns are overpriced to some degree or another. Be sure not to pay the inflated price. If you are not fickle and are open minded about different areas, you can actually get a great deal these days. If you are stuck on Naperville I would wait just a bit longer. Buying in naperville now at these prices has huge dowside potential with no upside potential. Honestly it's best to wait. It will be a long time before naperville sees any significant upside price movement with the expensive unsold inventory in Naperville. These towns all have about the same average household income around $100,000 and are all pretty close to one another. Nothing demographically seperates the areas. Naperville and Oswego are still very overpriced compared to it's household income. Unsold Iventory and mortgage defaults are just building up in those towns. Wait for the prices to come down because they most certainly will. To see what I am talking about take a look at Naperville's neighbor Plainfield. Plainfield is one of those areas that is starting to show the reality already. The housing prices were inflated and are now coming back to earth. There are so many foreclosures on the market in Plainfield. You can get a large cookie cutter new home just a few years old with granite counter tops and all the other thrills in it for under 170k in plainfield these days. But that may not even be considered a deal a year from now if naperville prices take a serious dive. This same home sold for like $400k just a few years ago. It all starts with unsold inventory. In my opinion all three of these towns have alot more downward direction to go.

Allen makes a good point. You definately gotta shop around. This is true of all burbs to an extent but even more with Naperville. Home prices havn't really dropped to where they should be. There are homes priced appropriately but many overpriced. I think the issue is people are not willing to accept the fact taht the house they paid 500k for is now only worth 375k.

As things sit on the market for a few hundred days and people see their neighbors houses either listed or selling for 50k less than theirs they slowly realize they either have to stay put or take the loss.

You either gotta shop around or just put in lowball offers, although I guess its not lowball if its a realistic value fo the house but when people are way overpriced they may see it as lowball.

That said I think if your looking at the higher end homes those for some reason seem to be priced more appropriatedly. I've seen a number of homes in White Eagle that sold a few years back for like 800k now listed for like 600k.
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Old 06-27-2010, 06:32 PM
 
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If you are going to spend 600k these days it better be one hell of a house. I wouldn't spend it in white eagle. Why not spend that in Oak Brook or Hinsdale? I would say the driving factors that created those relatively high property values in Naperville no longer exist, and will not exist anytime in the foreseeable future. The effect of ridiculous and irresponsible financial leveraging has been removed from the market and it will be atleast a decade before that kind of easy money returns. I think you will see some the hardest hit upscale areas in new money upscale subdivisions like White eagle. In those upscale new construction subdivisions there are people with real cash money invested mixed in with those who were just able to obtain a ridiculous amount of financing based on there high incomes. Once the real money starts to decide to take a loss and list there homes for less than what they paid for it and less than what there neighbor paid for theres, it's only a matter of time to see the outcome. it traps those who have high levels of financing into there mortage until they are no longer able to afford it. Only those who have a significant amount of cash equity can afford to take that kind of loss and list there property for less. Everyone else will have to sit tight. For those who are drowning in debt and no longer want to continue to waste a small fortune every month on an INVESTMENT that they now know will no longer pay off, the solution for them at the end of the day will be simple. Jumbo loans are hard to get with little money down these days. And the illusion of over paying to get in the elite area so that you can get a higher return euphoria is now gone. Most people in this price range who can afford to buy in the current conditions are using more of there own cash and are smarter about not taking on too much debt to income. There is no incentive to overpay anymore. There is an unbelievable inventory of upscale mini-mansions all over the chicago surburban landscape for under 400k with every amenity imaginable.

Last edited by allen2323; 06-27-2010 at 06:55 PM..
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Old 06-27-2010, 09:39 PM
 
21,740 posts, read 37,212,462 times
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$500k will basically not buy a vacant lot in Hinsdale. Oak Brook has some condo or townhouses in the fringe areas for half a mil, but appeal is limited.

White Eagle was developed about 20 years ago, values there never got as high for the most desirable sections in 203, be that either the historic sections or newer construction.

My crystal ball is about as foggy as even for a 10 year horizon, but I do know thatQUALITY OF LIFE is a much bigger driver of values than any flaky financing, and I have no problem telling folks that are buying into an area with greatQOL factors that is the right thing to do...
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Old 06-27-2010, 11:34 PM
 
829 posts, read 1,150,918 times
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$500k for a vacant lot? Well if you are willing to buy one of those $500k lots I am sure that you can find plenty of sellers who will be more than happy to unload it to you. The fact is $300k-$500k (even less) with a little cash for pre-move in replacement of carpet and painting will get you pretty much whatever you want these days in pretty much any neighborhood that you want to live in. Most buyers who can afford to buy in those areas in this market can also afford the cash need to make these minor repairs so why pay more? That is if you do your own homework and don't just blindly intrust a realtor who is profit driven to show you what they want you to see to keep the super high price illusion up. Here are a couple of links to properties that are on the market. There will be plenty of properties like these dumped on the market in the years to come. Easy little money down jumbo loan financing is over and getting jumbo loans without significant cash down is alot harder now. I am not saying that these still aren't very wealthy and prestigous areas. But, yeah it will take years maybe even a decade for prices to rebound back to what people were paying up until 2008, and will lead to an even larger inventory of unsold upscale homes that people paid inflated prices for. Banks will continue to unload there REO properties on the sly and most owners will just continue to pay up every month and pretend that there home values haven't been drastically affected by all of the REO sales in these up market areas. Just because you don't see a bunch of them on the market in these up market areas at one time doesn't mean that the cheap foreclosures don't exist there. It's called ghost inventory. When one cheap foreclosure sells another one will magically appear on the market at an even cheaper price. Foreclosures are managed differently in these areas than in lower market areas. In lower markets the foreclosures are just dumped and sit until they are purchased (as unfair as that may seem). In up market areas banks don't want to break the market illusion and risk more homeowners defaulting and not making there expensive monthly mortgage payments (the risk of strategic defaults). Like I stated before if you aren't fickle you can find what you are looking for and even more for under $400k in any upscale area. You just won't have the huge selection at one time but hey when getting a great deal beggars can't be choosers. The pool of suckers is begining to dry up and that might be a good thing. Here is one on the market for $399,000 in hinsdale 10S210 Oneil Drive, Hinsdale, IL, 60527 - MLS #07516049 - Single Family Home real estate - REALTOR.com® , This one is in oak brook for $480,000 906 Burr Oak Court, Oak Brook, IL, 60523 - MLS #07549797 - Single Family Home real estate - REALTOR.com® , Highland park for $539,000 795 S North Avenue, Highland Park, IL, 60035 - MLS #07551859 - Single Family Home real estate - REALTOR.com® , another in highland park for $409,000 http://www.realtor.com/realestateand...035_1119913219

Last edited by allen2323; 06-28-2010 at 12:46 AM..
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Old 06-28-2010, 12:34 AM
 
Location: Chicagoland
4,028 posts, read 4,279,077 times
Reputation: 1247
Quote:
Originally Posted by allen2323 View Post
$500k for a vacant lot? Well if you are willing to buy one of those $500k lots I am sure that you can find plenty of sellers who will be more than happy to unload it to you. The fact is $300k-$500k (even less) with a little cash for pre-move in replacement of carpet and painting will get you pretty much whatever you want these days in pretty much any neighborhood that you want to live in. Most buyers who can afford to buy in those areas in this market can also afford the cash need to make these minor repairs so why pay more? That is if you do your own homework and don't just blindly intrust a realtor who is profit driven to show you what they want you to see to keep the super high price illusion up. Here are a couple of links to properties that are on the market. There will be plenty of properties like these dumped on the market in the years to come. Easy little money down jumbo loan financing is over and getting jumbo loans without significant cash down is alot harder now. I am not saying that these still aren't very wealthy and prestigous areas. But, yeah it will take years maybe even a decade for prices to rebound back to what people were paying up until 2008, and will lead to an even larger inventory of unsold upscale homes that people paid inflated prices for. Banks will continue to unload there REO properties on the sly and most owners will just continue to pay up every month and pretend that there home values haven't been drastically affected by all of the REO sales in these up market areas. Just because you don't see a bunch of them on the market in these up market areas at one time doesn't mean that the cheap foreclosures don't exist there. It's called ghost inventory. When one cheap foreclosure sells another one will magically appear on the market at an even cheaper price. Foreclosures are managed differently in these areas than in lower market areas. In lower markets the foreclosures are just dumped and sit until they are purchased (as unfair as that may seem). In up market areas banks don't want to break the market illusion and risk more homeowners defaulting and not making there expensive monthly mortgage payments (the risk of strategic defaults). Like I stated before if you aren't fickle you can find what you are looking for and even more for under $400k in any upscale area. You just won't have the huge selection at one time but hey when getting a great deal beggars can't be choosers. The pool of suckers is begining to dry up and that might be a good thing. Here is one on the market for only $399,000 in hinsdale 10S210 Oneil Drive, Hinsdale, IL, 60527 - MLS #07516049 - Single Family Home real estate - REALTOR.com® , This one is in oak brook for $480,000 906 Burr Oak Court, Oak Brook, IL, 60523 - MLS #07549797 - Single Family Home real estate - REALTOR.com® , Highland park for $539,000 795 S North Avenue, Highland Park, IL, 60035 - MLS #07551859 - Single Family Home real estate - REALTOR.com® , another in highland park for $409,000 1149 Sheridan Road, Highland Park, IL, 60035 - MLS #07564398 - Single Family Home real estate - REALTOR.com®
Is there anything wrong with those houses? They are pretty large and in really nice cities but they are all so cheap.
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Old 06-28-2010, 11:34 AM
 
21,740 posts, read 37,212,462 times
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Well Allen demonstrates a trait that I find common among those that do not appreciate the most important principle of real estate, a total disconnect that LOCATION is vital to the pricing of all real estate, and nowhere is this more important than the luxury market.

The home on Burr Oak is in what arguably the least desirable part of incorporated Oak Brook, with the schools being largely Elmhurst,but a LONG bus ride needed to get them, a detachment from the other parts of Oak Brook caused by being surrounded by tollways and office parks, difficult journey to even the not too far away Oak Brook Village Golf Club, because of configuration of York Rd...

The home on O'Neil is not in Hinsdale, it merely has a Hinsdale postal address in unincorpated DuPage Co, might as well be Lemont...

No surprise that these are distressed sales, as the folks that bought 'em probably did not think too much about LOCATION when they acquired these properties. No doubt they too thought themselves real estate geniuses like...

Well here is the throw down-- if Allen has access to some secret store of bargain prices homes in good condtiton that lenders are hiding to keep suckers paying where are they? I mean seriously, the best neighborhoods are where all the regular posters here look, and I suspect lurkers too...
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Old 06-28-2010, 12:31 PM
 
829 posts, read 1,150,918 times
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Oh yeah, denial is also a very common trait these days. The tax bill for the property on burr oak is about $11,000 a year. That's on par with the average property tax bill in Oak Brook. A home two doors down from it sold in 1999 for $1,025,000. I am sorry but these are facts. Be in denial if you want.
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Old 06-28-2010, 01:49 PM
 
21,740 posts, read 37,212,462 times
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The more desirable sections of Oak Brook are served by Butler District 53-- significantly better value in for property taxes. The sale from 99 is relavent only in the context of foolish decisions made but others that do not understand the importance of location...
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Old 07-04-2010, 12:05 PM
 
Location: Oswego, Illinois (Churchill Club)
45 posts, read 97,920 times
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I have lived in both. Naperville has a reputation for being snobby. You pay for that. Oswego is up and coming, they have built so many stores and restaurants on Ogden, it's great. Plainfield seems like it's at a stand-still.
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