Chicago Real Estate

What is earnest money?
Mary, from Lincoln Park

Earnest money is a deposit from the purchaser given at the time of the seller’s acceptance and held in an escrow account with the listing office or a title company. Often a buyer will place a $1000 check with the offer. The rest of the earnest money is due after the buyer and seller have signed the contract. Most buyers will put 5% of purchase price down. If the sale goes through the earnest money will be applied to the purchaser’s down payment.

Julie Varones

What happens when the inspection turns up repairs needed to the property? Who fixes them? Who pays for them?\
Sally, from the West Loop

So you’ve had your inspection and there are some problems. It happens. So now what? There are a couple ways to handle any issues. One, the seller makes the repairs before closing. Or two, the seller gives the buyer a mutually agreed upon credit at closing for the necessary repairs and the buyer makes the repairs. And three, a combination of one and two. While the seller pays for the repairs, how the repairs are completed largely depends on the participants in the transaction, and what needs to be done.

Rebecca Siffel

Can I negotiate on price on New Construction?
Glen, from Bucktown

It depends on several factors: Is it the first unit to be sold? Is the last unit to be sold? How far along is the project when you are writing the offer? Do you want custom work? Typically developers would rather offer incentives like cabinet upgrades, or countertops, than take a price reduction. If it’s the first unit to be sold and the developer needs a sale to satisfy their lenders – then that might be an opportune time to negotiate price and upgrades.

Ben Osbun

How much are Real Estate taxes in Chicago?
Greg, from Wrigleyville

Good question. Chicago property taxes are always in the arrears by approximately one year so the answer to your question will be an estimate based on the following formula: Assessed Value (usually 1/3 of Market Value); multiplied by a Value Percentage for the area (25% for example); minus Homestead Exemption ($4500 in Chicago) or Senior Exemption: Then multiplied again for your particular Taxing District. In short, plan on 1-1.5% of Purchase Price for resale properties and 1.5-2% for new construction or conversions. And remember, your 2006 Tax Bill won’t come until 2007. Bills generally get sent out by mail in August and March. For more info go to the Cook County Assessor’s website.

Geno Petro

What are assessments?
Colm, from Lakeview

Rebecca Siffel

Lately, it seems my buyer clients want to know if a seller will accept an offer… even when they have not made an offer.

That is, my buyers have not sat with me and formulated a written offer for purchase. (Read More…)

Ok, everyone has an opinion about the real estate market “bubble” in the Chicagoland area. Here is how I see it:
(Read More…)

Over the past year or so I discovered an interesting Real Estate wrinkle I call “The $800,000 House Phenomenon.” I didn’t recognize it at first because I think it used to be called “The $600,000 House Phenomenon” but as the housing market changed, so did the phenomenon. And although I personally find it unique to the Northeast Side and North Shores of Chicago, its probably present in every market in any city at some pricepoint or another. It lays out something like this:
(Read More…)