After a long winter frozen foreclosure activity in Chicago is finally beginning to thaw.
And that’s good news because the market is hungry for more inventory, according to real estate experts from across the metro area.
Even in exurban McHenry County, one of the area’s hardest-hit housing markets, more foreclosure inventory is welcome, according to Tom Hall, broker-owner at Huntley Realty. The village of Huntley is located about 50 miles northwest of downtown Chicago.
“We are seeing a good amount of homes that are in foreclosure that are being listed for sale,” he said, noting that there was a drop in available bank-owned inventory a few months ago. “The good news is we’re gobbling up a lot of that backlog of inventory.”
Real estate agent Dave Goddard described a similar situation in Du Page County, south and east of McHenry County. Goddard, an investment property specialist, works at Garry Real Estate in Bartlett, located about 35 miles directly west of downtown Chicago.
“Foreclosure inventory has increased in the last few weeks due to what I’m assuming was the backlog from the whole robo-signing debacle,” he said, referring to the practice brought to light in late 2010 where bank employees were signing off on foreclosure documents en masse without verifying the accuracy of those documents. “I am seeing properties hit the market this week that I was inside of with buyers last year. They were pulled from the market due to legal problems and are just now being listed for sale again.
“In a stable market we might have 300 to 400 foreclosed properties available at any given time,” Goddard continued. “Right now I can point my finger at 4,914 that are available for sale today so more than 10 times the stable number, but this is down from highs around 6,500 and with demand outstripping supply we are stabilizing.”
Shifting to Seller’s Market
Broker G. Marie Leaner is also seeing demand outstrip supply in the “Gold Coast” where she works on the near north side of Chicago.
“Where the schools are good or where there’s an opportunity to opt in to a magnet school in that area, those units are going very quickly,” said Leaner, who specializes in luxury short sales and foreclosures with Coldwell Banker Gold Coast. “There are a lot of multiple-offer situations … you practically have to sit on top of the computer to make sure that you are first in.”
Although prices are still down from a year ago for both condos and single family homes in her area, Leaner said sellers are getting nearly 95 percent of their asking price thanks a lack of available inventory for buyers.
“We’ve got buyers. … They’re ready willing and able, but there’s less and less available for them to buy,” she said, noting that she has not yet seen many of the recent influx of foreclosures listed for sale.
“We keep waiting for the shadow inventory to manifest itself and thus far we haven’t really seen it,” continued Leaner, who started in real estate as a developer in 1990 and then got her sales license in 2003. “I’m seeing all these bank-owned properties, but they’re not listed anywhere. And when they do come on … as soon as they come on the market, they get snatched up.”