Nearly half of all mortgages in Chicago are underwater, according to Zillow. Chicago is also number five in the U.S. for the fastest falling home prices. These trends are all due to the rising amount of foreclosures on the market.
While this news isn’t the best for sellers, as it decreases overall real estate value, it is good for buyers, because it means that Illinois consumers can often get homes for 40% below the usual asking price, one of the highest discounts in the U.S. Many buyers and investors are recognizing this trend; after all, foreclosed homes made up 29% of all home sales in Illinois in the first quarter.
As a part of this, the number of foreclosures filed has definitely increased as well, rising to 150,000 filed in 2010, compared to 45,182 in 2009. Still, the amount of foreclosures is only expected to rise, because there are quite a few homes with a first lien and have been delinquent for 90-days. When this glut of foreclosed homes gets processed, there will be even more foreclosures on the market.
How have these foreclosures affected prices? Condominiums have seen the biggest drop in price, but single family homes have also decreased in price. Single-family homes are now at 2002 home value levels.
Other Top News:
Prices for Chicago condos, not single-family homes, fall to 2000 levels [Chicago Now]
Case-Shiller index points to double dip drop in home values [Chicago Tribune]
David Roeder suggests four different locations for the new Chicago casino [Chicago Sun Times]
Abandoned construction site at 434 W. Melrose [Curbed Chicago]
Chicago real estate similar to stock market: it’s a gamble [PRLog]
Demand for retail real estate on the rise [Biz Journals]