Determining best down payment for real estate purchase

Deciding factors include age, return on investment
By Jack Guttentag
Inman News
Courtesy Top Producer

"How much should I put down on a home purchase?"
In answering this question, I place borrowers into three groups. One group has no money for a down payment, so they have no down-payment decision to make. Their challenge is to qualify for a loan without a down payment.
The second group consists of those who can make a down payment of less than 20 percent. They must decide whether to put down the most they can afford, or something less – 5 percent, say, when they can afford 10 percent? And then they must decide whether to take a larger first mortgage, say 90 percent of value, and pay for mortgage insurance; or take an 80 percent first mortgage plus a second ("piggyback") mortgage at a higher rate for the additional amount needed. I have written about both decisions in previous articles.
The third group consists of those who can afford to put more than 20 percent down, perhaps even 100 percent, and must decide how much it should be? They are the subject of this column.
Assume Jacques has $100,000 of surplus cash, over and above the 20 percent he will put down. He can use the $100,000 either to make a larger down payment, or he can continue to hold it as an investment. His objective is to have the most wealth at the end of the period during which he expects to be in the house; or, if his wealth is the same at that point, he wants to select the option that will allow him to spend more over the period.
There is one simple rule that, if followed, will achieve this objective. Take the mortgage if the investment return on the $100,000 is higher than the mortgage rate. If the investment return is lower than the mortgage rate, use the $100,000 as an additional down payment.
This is an application of the standard investment rule, that the better investment is the one providing the higher return. Increasing the down payment is an investment in the mortgage you avoid, on which the yield is the mortgage rate you don't pay. For example, if you put $100,000 down instead of borrowing that amount at 6 percent, your return on the $100,000 is the 6 percent you would have paid on the mortgage. If the alternative use of the $100,000 is to keep it in the bank earning 3 percent, you do better using it to make a larger down payment.
Here is a simple example that will illustrate the principle. If Jacques earns 3 percent on his $100,000 of financial assets, his investment income is $250 a month. If the 6 percent mortgage he is considering is interest-only, it will cost him $500 a month. Net, he loses $250 a month.
If, instead, he uses the $100,000 to increase his down payment, he has no investment income or mortgage interest to pay, so his income from these sources is zero. He thus has $250 a month in disposable income that he would not have had had he taken the mortgage. He can live a richer life by spending it, or he can invest it and end up with more wealth, or some combination of the two.
An investment in mortgage avoidance makes good sense for elderly home buyers whose money is invested very conservatively. Their objective is more likely to be maintaining consumption rather than increasing wealth. So long as the mortgage rate exceeds the yield on their investments, consumption at a given level will deplete their wealth less rapidly if they avoid a mortgage.
Home buyers with excess cash who can earn a return above the mortgage rate may do better taking the mortgage. It may pay to take a mortgage at 6 percent if you can invest at 10 percent. I say "may" rather than "will" because any investments that promise yields above the mortgage rate carry risk, whereas the return on mortgage avoidance has no risk.
Younger buyers with excess cash are in the best position to assume the risks. If they take the mortgage and invest their cash in a diversified portfolio of common stock, they have an excellent chance of earning 9 percent-10 percent over a long period. Because they are young, they can take a long view and ride out short-term fluctuations in the stock market.
But they should have the stomach for it. If they are going to have a gastric upset every time the value of their portfolio drops, they should opt for the safe return on investment in mortgage avoidance.
The writer is Professor of Finance Emeritus at the Wharton School of the University of Pennsylvania. Comments and questions can be left at www.mtgprofessor.com.

Hope everyone enjoyed the beautiful weather today

www.GreatChicagoRealEstate.com

Looks like the Spring market is here... finally.

Fair Housing

Where to turn
Who's covered? Who can help?
Courtesy Chicago Tribune

Government agencies police housing discrimination on several levels: federal, state, county and city.

The federal Fair Housing Act and its 1988 amendment protect against discrimination based on race, color, religion, sex (including sexual harassment), national origin, disability and familial status. It also protects against discrimination by retaliation, intimidation and coercion. Owner-occupied apartment buildings of four for fewer units are excluded. It's enforced by the U.S. Department of Housing and Urban Development Office of Fair Housing and Equal Opportunity, (312) 353-7776 or toll-free at 800-669-9777. The toll-free telephone number for the hearing impaired is 800-927-9275.

The Illinois Human Rights Act prohibits discrimination based on race, color, religion, sex (including sexual harassment), national origin, ancestry, age, marital status, disability, familial status, unfavorable military discharge and military status. It also protects against discrimination by retaliation. Owner-occupied rental buildings of five or fewer units are excluded. It is enforced by the Illinois Department of Human Rights, (312) 814-6200.

The Cook County Human Rights Ordinance outlaws discrimination based on race, color, religion, sex (including sexual harassment), national origin, ancestry, age, marital status, disability, parental status, sexual orientation, source of income, military discharge status, housing status, and also protects against retaliation. The ordinance is enforced by the Cook County Commission on Human Rights, (312) 603-1100.

The Chicago Fair Housing Ordinance offers protection against discrimination based on race, color, religion, sex (including sexual harassment), national origin, ancestry, age, marital status, disability, parental status, sexual orientation, source of income and military discharge status. This ordinance is enforced by the Chicago Commission on Human Relations, (312) 744-2852.

Nonprofit organizations that assist buyers and renters on fair housing issues include:
• Access Living Chicago, (312) 226-5900.
• HOPE Fair Housing Center, (630) 690-6500 or
• hopefair@aol.com.
• Latinos United/Comprehensive Advocacy for Fairness in Housing, (312) 258-8655.
• Lawyers' Committee for Better Housing, (312) 347-7600.
• Leadership Council for Metropolitan Open Communities, (312) 341-5678.
• Legal Assistance Foundation of Chicago, (312) 341-1070.
• Metropolitan Tenants Organization, (773) 292-4980.
• South Suburban Housing Center, (708) 957-4674.

The top 10 list of buyer and owner mistakes

Here are 10 of the most common mistakes home buyers and owners make, and how to avoid them:

- You choose the wrong mortgage. With the advent of instant financing, home loans are no longer the lifetime obligations they once were. Still, you don't want to be saddled with the wrong one, even for a short period. It's just too expensive to get out of.

Therefore, investigate all your options, then lay your favorites side-by-side and make comparisons. Above all, though, do the math, making sure to compare worst-case scenarios.

- You confuse pre-approved with pre-qualified. These are not interchangeable terms. When you are pre-qualified, the lender is making an educated guess about how much you can borrow based on the information you provide. It is an estimate and nothing more.

When you are pre-approved, the lender has verified everything you have told him and "guaranteed" to lend you a certain amount at current interest rates. Even then, however, final clearance is subject to an appraisal of the property you decide to buy.

You still haven't crossed home plate until you have a commitment letter stating the rate and loan amount at which you have been approved and for how long. Even then, though, you can be called out if a second look at your credit report a day or two before closing reveals you've incurred some extra debt in the interim.

- You have too much credit. Excessive credit is almost as damaging as having bad credit, or even no credit. Credit scoring models tend to focus just as much on the amount of credit you have available as whether you pay your bills on time.

Cancel the credit cards you don't use. And postpone those big-ticket purchases until after closing.

- You lie on your loan application. It may seem like a little white lie, but exaggerating your income on a mortgage application or putting down other falsehoods is a federal offense.

Lenders rarely prosecute liars. But if they find out later that you fibbed, they can call the loan due and payable. What's more likely, however, is that you get approved for a loan or house you really can't afford. Even if your loan officer says it's OK to fudge just a little, don't do it.

Don't ever sign your name to a loan application that's not completely filled out. Loan officers have been known to go behind their clients' backs by stretching the truth to get them approved. But it's the borrower who ends up paying the price.

- You hide if you can't make the payments. The worst thing you can do is ignore phone calls and letters from your lender when you get behind on your payments. Lenders are bending over backwards these days to keep people in their homes, and they have numerous options to avoid foreclosure.

Among other things, they can rewrite the terms so you can start over with a clean slate at a payment you can afford, or they can set you up with a financial counselor who can help you.

But they can't do anything for you unless they can talk to you.

- You skip a home inspection. Failing to make your purchase contingent on a satisfactory examination of the property by an independent home inspector could be a costly mistake.

A good home inspector will go over the place from stem to stern. He or she will be able to tell you whether the roof and/or basement leaks, whether the mechanical systems are in good shape and how long the appliances should last. They can't report on things they can't see, but at least their trained eyes are better than yours.

So don't pass up an inspection just to save $300 to $400.

- You hire just any agent to sell your house. All real estate agents are not cut from the same cloth. You want to look for those who specialize in your neighborhood and are top producers. If Aunt Bessie or Nephew Nick don't fit that description, look elsewhere.
Ask your candidates how they plan to market your house, what you can do to make the place more attractive to prospects and how much you should ask for it. If you don't like any of the answers, keep searching until you find one you are certain will do a good job on your behalf.

Beware of those who suggest you should be able to obtain top dollar or more. Unless yours is an extra-special house, they may be saying that just to get the listing. If this is the case, you will be brought back down to earth in a few weeks when they tell you the place isn't selling because it is priced too high.

- You fail to check out a remodeler. Never hire a contractor who knocks on your door or says his prices are good for only a few days.

Whether they are specialty tradesmen who do only one thing like siding or roofing or remodelers who handle large projects like additions or total makeovers, reputable contractors don't solicit door-to-door, and they don't cut prices just because they happen to be in the neighborhood.

Check out a potential contractor by calling several past clients, your local Better Business Bureau or consumer affairs agency, and the contractor's bankers and suppliers. It's also a good idea to take a look at his work. What is acceptable to someone else may not be acceptable to you.

- You pay too much up front. If a contractor asks for more than a third of the contract as a down payment, chances are something's wrong.

At worst, he's a scam artist who has no intention of returning after he cashes your check. At best, he's undercapitalized and can't afford to buy materials without your funds. Or, in between, he could be using your money to pay workers on another job.

And one more thing: Never give a contractor cash.

- You burn your mortgage. Many people celebrate making their last house payment by holding a mortgage burning party. That's OK, but don't torch the original document. Make a copy and burn that instead. Keep all your loan papers in a safe place.

Lew Sichelman, United Feature Syndicate
Published March 27, 2005

Chicago Traffic Alerts

Did you know that you can get traffic alerts emailed to you? These emails include everything from flight information, Metra, CTA, expressways, and the Loop. Check out the City of Chicago for more information on this service. You can also get up-to-date travel information that includes congestion levels, construction, and accidents at GCM Travel.

Chicago Events for 2005

Chicago Winter Delights: It's A Cool Place: January 6 - February 27
7th Annual Mayor Daley's Kids and Kites Festival: May 14 & October 1
Mayor Daley's Jumping Jack: May-September
2005 Chicago Summer Neighborhood Festivals: May-September
2005 Farmers Markets: May-November
Bike Chicago 2005: May–July
7th Annual Great Chicago Places and Spaces: May 20-22
21st Annual Chicago Gospel Music Festival(in Millennium Park):June 3-5
22nd Annual Chicago Blues Festival: June 9-12
25th Annual Taste of Chicago: June 24-July 4
15th Annual Chicago Country Music Festival: June 25-26
13th Annual Race to the Taste: June 26
6th Annual Chicago Outdoor Film Festival: July 12-Aug 23 (Tues. Only in Butler Field)
12th Annual Mayor's Cup Youth Soccer Tournament: July 23-24
48th Annual Venetian Night: July 30
47th Annual Chicago Air and Water Show: August 20-21
17th Annual Viva! Chicago Latin Music Festival: August 27-28
27th Annual Chicago Jazz Festival: September 1-4
9th Annual Celtic Fest Chicago: September 17-18
Chicagoween: October
Chicago Book Festival: October
8th Annual Halloween Pumpkin Plaza: October 14-31
Halloween Happening: October 22
Daley Plaza Santa's House: November 24-December 24
Tree Lighting Ceremony: November 25
Mayor Daley's 6th Annual Holiday Sports Festival: December 28-30
New Year's Eve Fireworks at Buckingham Fountain: December 31

For more information on any of the above events visit the City of Chicago website.

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www.GreatChicagoRealEstate.com

Gardening Tips for March

March toward spring: There's work to do
Courtesy Chicago Sun Times

As daylight grows longer, spring in not too far away. The Illinois Landscape Contractors Association offers these guidelines for March:
General care
• Water-soaked dead patches of turf may show up after the snow melts. They are most likely caused by snow mold. Examine them closely. The presence of pink fruiting bodies confirms it. The disease is mostly cosmetic. Avoid future infestation by improving drainage, and, if possible, pile snow on hard surface areas instead of on the turf.
• Resist the temptation to remove winter protection from the garden until all danger of a hard freeze has passed. Mulch, evergreen boughs and other winter covers help prevent plant loss from temperature swings. They also help protect plants from rodents.
• Check your perennials and ground covers for heaving caused by alternate high and low soil temperatures. Reset them as soon as the soil is workable.
• Apply 5-10-10 fertilizer (at a rate of 1 pound per 100 square feet) over spring bulb plants and perennial beds after the ground has thawed.
• If any perennials require transplanting, early spring is the time to do it.
• Avoid unnecessary travel through wet beds and turf to avoid compacting saturated soils.
Crabapple tree care
• Apply fungicidal treatments to crabapple trees that have been affected in the past by apple scab. Apple scab causes the leaves to discolor and drop prematurely. If severely affected, a crabapple will loose the majority of its leaves by mid- to late summer.
• The fungicide applications need to start soon, at "green tip stage," which is the point where the tip of the leaf is visible on the bud. Three applications, 14 days apart, are required and should continue if the spring is unusually wet.
• To help prevent apple scab, always allow as much air movement as possible through the plant by selective pruning of the interior branches. Air helps dry the leaves faster and lower the humidity in the tree canopy after a rain or times of high humidity.
Tree planting care
• Be aware that a major reason for the death of newly planted trees and shrubs is drainage problems. If the plants chosen are not best suited for a naturally wet area, a drainage system must be installed. This could mean a drainage system which takes water away from a general planting area, or a system which is connected to each individual tree pit.
• Avoid the common mistake of installing the plant too deeply, which can cause death because of too much water or a lack of oxygen for the roots. Determine the top of the root ball by the location of the root flair (where the trunk flairs out to form the root structure) and not by simply looking at the top of the burlapped root ball or the soil level in a containerized plant. Err on the side of the tree being planted slightly too high rather than too low.
ILCA offers the free brochures, "Your Landscape Begins With A Dream," for planning, budgeting and creating outdoor spaces and "Garden Centers Are 'Natural' Resources," with guidance in garden center selection. Included is a list of member landscape contractors and garden centers. Call (630) 472-2851, write ILCA, 2625 Butterfield Road, Suite 204W, Oak Brook 60523 or e-mail lodell@ilca.net for print material.

Add restaurants to the stew that attracts buyers to neighborhoods

Theresa Miller has been a "foodie" all her life.

Growing up in Mexico City, her family had a ritual of trying new restaurants every weekend. Today, she works for a food manufacturing trade association in Chicago and a big part of her and her husband's social life revolves around dining out with friends.

When it came time for the Millers to buy their first home, they considered nearby restaurants when evaluating potential locations.

The couple bought a two-bedroom house in Lakeview three years ago, right around the corner from their old apartment. Miller loves the diversity of restaurants within walking distance.

"Whatever kind of food we feel like, it's within two to five blocks of our place," Miller said. "That was a big part of our decision to stay in this area."

In the past, home buyers have sought attractive neighborhoods with good schools, parks, a decent commute and low crime rate. Miller's experience is evidence that for more buyers a new criterion has been added to the mix -- restaurants.

The Millers are the kind of people whose friends always let them choose where to eat, because they know all the restaurants.

"Some people do movies," Miller said. "We do food."

They like independently owned restaurants and gravitate to those with an eclectic, Latino flare, like Tango Sur and Coobah. They rarely visit chains.

In September, the Millers' friends, Melissa and Tim Goldenman, bought a home in the Andersonville neighborhood, where they had lived for six years.

Previously, the Goldenmans lived in Rogers Park and then Lakeview.

"We really liked Rogers Park, but there was no place to go. No restaurants, no bars," Melissa Goldenman said. "It was one of the big reasons we left."

Chicago-area real estate agents confirm the trend.

"I've been really aware of the importance of restaurants," said Maggie Finegan, the Goldenman's real estate agent. "It definitely plays a part, especially for young singles, and even people moving up."

Her clients seek the wide variety of food choices in Andersonville and Lincoln Square, Finegan said, from upscale ethnic to casual sitdown and delis for carryout.

Eating out has become an integral part of the Goldenmans' lives and millions of other Americans, too.

The National Restaurant Association predicts that Americans will spend almost half their food budget on eating out this year, compared to 25 percent in 1955.

"What you're seeing is how restaurants have become America's dining rooms," said Hudson Riehle, senior vice president for research at the National Restaurant Association in Washington. "It's no big deal to eat out now."

Restaurant and residential development have a circular effect on each other, Riehle said. As more residents move into an area, restaurants follow. Then, more residents arrive in search of a variety of good restaurants.

Riehle has identified a number of other factors that have driven restaurant sales to an estimated $476 billion in 2005, including convenience, increased earning power and the social aspect.

Milwaukee real estate executive Tammy Maddente calls the quest for convenience "the McDonald's society."

"The last thing I want to do after I've worked eight or 10 hours is to go home and make dinner. Obviously you want to be surrounded by good restaurants, so you have plenty to choose from."

The Goldenmans dine out at least four or five times a week, but it is about more than food. It is a big part of their social life and is embedded in the culture of their Andersonville neighborhood.

They like the fact that neighborhood restaurateurs greet them by name and offer bowls of water for their dog.

The couple has gotten to know many of their neighbors by running into them in restaurants.

"When you see people out more than once, you tend to have a conversation with them," Melissa Goldenman said. "It's a fun way to meet our neighbors and stay social."

The Goldenmans eat breakfast out at least once every weekend, usually at Ann Sather or Charlie's, and afterward join their neighbors with kids and dogs at Andersonville Park on Ashland Avenue.

The residential population has long driven the business development in Andersonville. In contrast, trendy restaurants like Blackbird and Marche have sparked the housing boom in Near West Side neighborhoods, said Marty Winefield, an agent with @ Properties.

"Andersonville has had residential forever," Winefield said. "It's a no-brainer to open a business there. In the West Loop, restaurants are actually leading residential development."

Renee Finucane has seen the same thing happen in Evanston. Finucane manages Prudential Preferred Properties in downtown Evanston and recently moved into a new condo across the street from her office.

She loves being able to walk to shops, the library, the lake and, of course, restaurants.

When she first moved to the area in 1978, Evanston had few restaurants and few residents living downtown. She credits the restaurants with bringing downtown Evanston to life.

"The restaurants led to the entertainment and then led to the residential," Finucane said.

Over the last decade, Maddente said agents with her company, First Weber Group, have seen the same thing happening downtown and on the east side of Milwaukee.

In St. Louis, residents have been moving back to resurging older neighborhoods as restaurants have opened, said Erin Jamison, a real estate agent who works in the Soulard, Lafayette Park and Tower Grove East neighborhoods.

"We get people who are looking for fun neighborhoods all the time and fun typically means bars and restaurants," Jamison said.

And in the biggest restaurant city in the country, the trend is clear just from reading the real estate ads, said New York real estate executive Neill Binder.

Ads for property on the Upper West Side of Manhattan often mention its proximity to two upscale grocery stores that have gourmet carryout: Zabar's at 81st and Broadway, and Fairway, two blocks away.

Binder, a partner in Bellmarc, a residential real estate firm with 350 brokers, said restaurants and grocery stores such as Zabar's have increasingly influenced home buyers' decisions over the last 10 years.

"There are a whole lot of people who are deciding where to live based on how many blocks they are from Zabar's," Binder said. "It makes a difference in the pricing in the area."

Back in Lakeview, Theresa Miller has another reason for loving her proximity to so many restaurants: "In a snowstorm, we can still go out and get sushi."
Copyright © 2005, Chicago Tribune

By Stacy Lonati Ross
Special to the Tribune
Published March 20, 2005

www.GreatChicagoRealEstate.com

Golf Around Chicago

The 10th Annual Golf Around Chicago begins this weekend thru April 13th at Navey Pier. You have the opportunity to play an 18 hole miniature golf course that portrays Chicago’s landmarks. For more information visit Navy Pier or Metromix. Proceeds benefit the Epilepsy Foundation of Greater Chicago.

Sundays : 10 a.m. - 7 p.m.
Mondays : 10 a.m. - 10 p.m.
Tuesdays : 10 a.m. - 10 p.m.
Wednesdays : 10 a.m. - 10 p.m.
Thursdays : 10 a.m. - 10 p.m.
Fridays : 10 a.m. - 10 p.m.
Saturdays : 10 a.m. - 11 p.m.

Price: $6.75; $5.25 for kids under 12

Real estate purchases grow

Adjustable-rate loans at highest level since December 2004
Wednesday, March 16, 2005
Inman News
Courtesy Top Producer

Overall mortgage applications increased last week, going up 3.2 percent on a seasonally adjusted basis from the week before, according to the Mortgage Bankers Association’s weekly survey.
The MBA seasonally adjusted purchase index increased by 2.5 percent to 462.8 from 451.7 the previous week. The seasonally adjusted refinance index increased by 4.2 percent to 2,267.5 from 2,176.8 one week earlier.
The adjustable-rate mortgage index, seasonally adjusted, increased by 9.6 percent to 5,169.9 from 4,717.3 the previous week.
"The adjustable-rate mortgage index increased almost 10 percent last week while fixed rates jumped almost a quarter of a point. The index is now at its highest level since mid-December 2004," said Michael Cevarr, MBA's director of member surveys.
The refinance share of mortgage activity increased to 42.9 percent of total applications from 42.6 percent the previous week. The adjustable-rate-mortgage share of activity increased to 32.4 percent of total applications from 30.5 percent the previous week.
The average contract interest rate for 30-year fixed-rate mortgages increased to 5.91 percent from 5.69 percent one week earlier. Points including the origination fee stayed at 1.23 for 80 percent loan-to-value ratio loans.
The average contract interest rate for 15-year fixed-rate mortgages increased to 5.47 percent from 5.25 percent the previous week. Points including the origination fee increased to 1.24 from 1.22 for 80 percent loan-to-value ratio loans.
The average contract interest rate for one-year adjustable-rate mortgages decreased to 4.19 percent from 4.43 percent earlier. Points including the origination fee increased to 1 from 0.95 for 80 percent loan-to-value loans.
Washington, D.C.-based Mortgage Bankers Association is a national association representing the real estate finance industry.

City, schools to offer mortgage assistance to teachers

Courtesy Chicago Tribune
By Jeanette Almada
Special to the Tribune
Published March 13, 2005

The Chicago Department of Housing and Chicago Public Schools are partnering to bring mortgage assistance to Chicago public school teachers who buy homes in the city.

"It is a good time to be a teacher in the Chicago public school system," said Kathe Myers, a Peck Elementary teacher who says she had been searching for an affordable home for years.

Myers hopes to move into her condo in the Westhaven Park neighborhood on the Near West Side in summer 2006, she said in an interview earlier this month.

Under the Teacher Homebuyer Assistance Program, $500,000 will be administered by the Chicago Department of Housing, with the department and the public schools each contributing half of the funds. "We are seeking another $250,000 from a private foundation," said Diana Johnson, manager of the Chicago Public Schools Teacher Housing Resource Center.

City public school teachers can qualify for a $3,000 mortgage subsidy, according to Johnson.

Myers will receive a $7,500 mortgage subsidy toward her condo because Westhaven Park is part of the Chicago Housing Authority's redevelopment of public housing complexes into mixed-income neighborhoods. The higher subsidy applies to all such new mixed-income developments associated with redevelopment of CHA complexes.

The subsidy will be available through nine lenders, according to Johnson: Banco Popular, Bank of America, Bank One, CitiMortgage, Countrywide Home Loans, Harris Bank, LaSalle Bank, National City Bank and Washington Mutual Bank.

"Some developers have offered their own incentives to teachers and some of them to all Chicago Public School employees," Johnson said. Those developers include The Havens, being built by Chicago-based Cornerstone Residential LLC at 87th Street and Parnell Avenue in Auburn Gresham; condos being built by Naperville-based New Vision Development on the 300 block of North Hamlin Avenue, the 300 block of South Hamlin and the 3400 block of West Monroe Street in the Garfield Park neighborhood; and Chatham Courts Condominiums, being built by Chicago-based MLC Development in the Chatham neighborhood.

The Havens, for example, also offers $4,000 in upgrades to city public school teachers, according to Jay Johnson of Cornerstone.

"Teachers can visit our Web site [www.teacherhousing.cps.k12.il.us] to find a complete list of all developer partners and details of each of their incentive programs," Johnson said, adding that some of those benefits are offered to other public school employees.

Like all teachers in the program, Myers had to qualify to participate. "I had to take a home buyer class and have already attended that class at the Rogers Park Community Development Corp.," Myers said. She also agreed to remain a teacher in the Chicago Public School system for five years from her mortgage closing date.

"Some teachers are combining the mortgage subsidy benefits of the program with benefits offered in other city and CHA programs, so other terms may also apply," Johnson said.

For example, Myers is buying a condo that Westhaven Park is marketing as affordable, discounted from the market-rate prices that other comparable units in the Westhaven Park neighborhood are selling for. Therefore, Myers is agreeing to turn over profits from sale of her unit to the city, if she should opt to sell before paying off her 30-year mortgage.

Historic Frank Lloyd Wright home sells at auction

Private homeowners buy Chicago house for above opening bid
Wednesday, March 09, 2005
Courtesy Top Producer
Inman News
The Emil Bach House in Chicago

Private homeowners on Tuesday purchased the Frank Lloyd Wright-designed Emil Bach House, a Chicago Landmark located one block from Lake Michigan, during an auction conducted by Inland Real Estate Auctions.
The new owners intend to live in the house, according to Inland, which didn't disclose the exact final sale price, but said it went for "well above the opening bid of $750,000."
The landmark property is located at 7415 N. Sheridan Road.
The new owners intend to retain the property's 45-by-150-foot side lot as a yard for the home, which is one of Wright's last small urban homes, according to Inland. The current zoning of the lot might have allowed for development.
The sale marks one of the first times a Frank Lloyd Wright-designed home has sold by auction.
"Today's auction sale proves that Frank Lloyd Wright homes can attract substantial interest and can be sold in a timely fashion when marketed properly," said Frank Diliberto, senior vice president of Inland Real Estate Auctions. "It also provides further evidence that the auction process can be successful in marketing properties others find difficult to sell."
The auction process drew nearly 300 inquiries and nearly 200 registered open house attendees. The auction room was filled with bidders as the bidding process commenced at 2 p.m. Bidding was completed in a matter of minutes.
The expansive lawn, which lies immediately to the south of the house, is currently zoned RT4, which allows for multifamily homes. This prospect drew some concern from Frank Lloyd Wright enthusiasts. Alderman Joe Moore (49th Ward), who represents the Rogers Park neighborhood, recently introduced a proposal in the City Council proposing to down-zone the property. The purchaser has not announced plans for the lot, but has ruled out development.
Oak Brook, Ill.-based Inland Real Estate Auctions is part of The Inland Real Estate Group of Cos., which comprises independent real estate investment and financial companies.

GCRE Client Testimonial regarding team member Richard Doty!

Below is a testimonial from one of our GCRE clients, regarding our team member Richard Doty. Great job Richard!!

After a lifetime of realtors, I found Richard to be the most caring, thoughtful, honest and dedicated realtor I have met. He was able to hear what I wanted and make educated choices about what would meet my needs.

Instead of relying upon me to edit out communities and variables that clearly did not suit me, his ability to listen and discern, meant that what he showed to me suited me.

Most realtors are in the business to make a living. Richard is providing a service to which he is dedicated and it happens to be a business. His heart is clearly part of the package. He works with you as if you were his family and his concern is that you end up where you will be happy.

I wish Richard worked all over the country, and in fact, I wish he worked in all industries. He takes his experience and his knowledge and intelligence and puts them to work in partnership with you to bring you the best results.

Cheers to Richard!

-Jessica T

Retirees options in Chicago area growing

Choices growing for active adults
Retirees options in Chicago area growing
By Jim Edwards
SPECIAL TO SUBURBAN CHICAGO NEWSPAPERS

While some older adult buyers gravitate to retirement communities almost the size of Vermont, others choose to live in smaller conclaves.
In the past, empty-nesters, recent retirees and other non-dependent seniors looking for a new home were faced with only a handful of choices in the Chicago area. Many moved to massive golf course developments in sunny states in the South, but soon missed their old homesteads.
Today, the age-55-plus crowd has many more choices in the Chicago suburbs. Many active adults are opting to live locally in smaller-scale communities which offer a healthy choice of recreational activities and pampering amenities, as well as a variety of designs from detached ranches to duplexes.
Several key factors are responsible for the trend toward smaller active-adult developments, according to William E. Becker, president and managing director for the William E. Becker Organization, a Teaneck, N. J.-based strategic marketing planning and consulting firm that specializes in active-adult lifestyle communities.
"Big parcels of zoned land on which builders can develop an active- adult community are more scarce and expensive unless they're further away from large metro areas. But Baby Boomers don't want to travel as far as they used to," Becker said.
Becker also believes that this trend toward smaller-scale active-adult communities will be a long-term trend for at least 30 years.
"By the year 2020, there will be 77 million Boomers, many of whom will be clamoring for this type product," Becker said.
Leslie Marks, executive director of the Seniors Housing Council of North America Home Builders Association (NAHB) of Washington, D.C., affirms this trend toward living locally.
"Surveys and statistics show that today's seniors and active adults prefer to remain closely rooted to family, friends, neighbors, doctors and churches in the areas they're familiar with. They value an intimate relationship with the community they call home."
Here are a few from among the many small-scale 55-plus communities to be found in the Chicago suburbs.
North, West and South
Burnside Homes is the developer of a new active-adult community concept called "Traditions." Recently launched in Olympia Fields and Waukegan, Traditions properties feature a wide variety of multifamily and single-family residences. "The Traditions concept is different from other active-adult developments in its scope, locations, designs and prices," said George Arguilla, III, president of Burnside Homes. Each Traditions community is maintenance-free and generally offers between 75 to 200 homes. Most communities provide up to 19 designs over three product lines: single- family ranch homes, duplex homes, and quad homes. Burnside Homes recently opened sales at Traditions at Glen Flora, a community of 98 maintenance-free attached ranch homes in Waukegan. Located at Blanchard and Sheridan roads in Waukegan, Traditions at Glen Flora in a 27-acre wooded property adjacent to the renowned Glen Flora Country Club and a forest preserve. Burnside's first active-adult property — Traditions of Olympia Fields — began sales earlier this summer.
Glen Flora buyers can choose from two different series of homes. The Club Home Series of duplex residences in three designs that include two to three bedrooms, two baths, and two-car garages. These homes range in size from 1,609 to 1,861 square feet and are base-priced from $259,900 to $276,900. The Carriage Series quad homes are available in eight designs that feature one to two bedrooms plus den (per plan), two baths, and two-car garages, range in size from 1,414 to 2,047 square feet and are base-priced from $229,900 to $300,900.
Burnside Homes plans to open its third active- adult community, Traditions of Fitchie Creek in Elgin, in early 2005.
In the Heartland'
Haverford Place is Ryland Homes first venture into an active adult lifestyle in the Chicago area. Located in Hoffman Estates, Haverford Place, a community of 172 ranch homes features lush landscaping and pocket parks throughout the neighborhood.
"Many of our homes have a generous leisure porch at the front of the home and each home includes a beautiful deck," said Karen Gold, sales counselor for Ryland Homes.
Haverford Place also offers a beautiful clubhouse with fitness center, pool and tennis courts. One of the special amenities in the clubhouse is a full granite kitchen for community parties, and the personal entertainment needs of the residents.
There are 10 home plans from which to choose. The smallest of the ranch homes is the Alexander, which features a covered entry, oversize living and dining room, second bedroom, study with double-door entry, conversational kitchen and family room, and owners' retreat. An available third bedroom replaces the study. The homes has 1,878 square feet and is base priced in Phase I at $347,990.
Another 2,202-square-foot design offers a leisure porch, oversize breakfast area, breakfast bar in addition to kitchen island, formal entertaining area with open living/dining room, walk-in closet even in the second bedroom, extra storage closet and owner retreat. A study can replace the living room. This home is offered during Phase I, base-priced at $386,000. Included features found in the homes are sodded and landscaped yards, brick exterior, 9-foot ceilings on first floor, and air conditioning with 90-percent high-efficiency furnace valued at $61,200.
Not being alone
For most of the last century, older American were stereotyped as being ready for disengagement from life upon retirement. Today, this theory has been trashed. People aged 55 and older are healthier and more active.
They are not giving up work, are engaged in often-strenuous recreation and are not willing to give up being close to lifelong friends and relatives.
Dena Amoruso writing for Realty Times, noted, "In active adult atmospheres, successful aging just plain gets easier for many older men and women. All in one place, residents can find new friends, partially replace paid employment with useful activities, regularly exercise without having to join and pay for a health club, and enjoy leisure as never before."