Real Estate Information Archive

• Your contractor should be able to give you energy fact sheets for different types, models, and designs to help you compare energy usage. For furnaces, look for high Annual Fuel Utilization Efficiency (AFUE) ratings. The national minimum is 78% AFUE, but there are ENERGY STAR® models on the market that exceed 90% AFUE.
• Place heat-resistant radiator reflectors between exterior walls and the radiators.
• Clean or replace filters on furnaces once a month or as needed.
• Use fans during the summer to create a wind chill effect that will make your home more comfortable. If you use air conditioning, a ceiling fan will allow you to raise the thermostat setting about 4°F with no reduction in comfort.
• Install a programmable thermostat that can be adjust the temperature according to your schedule.
• ENERGY STAR® labeled products can cut your energy bills by up to 30 percent. Find retailers near you at http://www.energystar.gov/ when you’re ready to replace your heating and cooling systems – as well as appliances, lighting, windows, office equipment, and home electronics.
• Insulate your hot water heater and hot water pipes to prevent heatloss.
• Insulate heating ducts in unheated areas such as attics and crawlspaces and keep them in good repair to prevent heat loss of up to 60 percent at the registers.
• For more heating and cooling tips, visit http://www.energy.gov/heatingcooling.htm.

If you live in a typical U.S. home, your appliances and home electronics are responsible for about 20 percent of your energy bills. These appliances and electronics include everything from clothes washers and dryers, to computers, to water heaters. By shopping for appliances with the ENERGY STAR® label and turning off appliances when they're not in use, you can achieve real savings in your monthly energy bill.

• Many appliances continue to draw a small amount of power when they are switched off. These "phantom" loads occur in most appliances that use electricity, such as VCRs, televisions, stereos, computers, and kitchen appliances. In the average home, 75% of the electricity used to power home electronics is consumed while the products are turned off. This can be avoided by unplugging the appliance or using a power strip and using the switch on the power strip to cut all power to the appliance.
• Clean the lint filter in the dryer after every load to improve air circulation.
• ENERGY STAR® computers and monitors save energy only when the power management features are activated, so make sure power management is activated on your computer.
• Periodically inspect your dryer vent to ensure it is not blocked. This will save energy and may prevent a fire. Manufacturers recommend using rigid venting material, not plastic vents that may collapse and cause blockages.
• Plug home electronics, such as TVs and DVD players, into power strips; turn the power strips off when the equipment is not in use (TVs and DVDs in standby mode still use several watts of power).
• Saving energy starts with being an informed consumer. Estimate an appliance's annual energy cost using this guide.
• There is a common misconception that screen savers reduce energy use by monitors; they do not. Automatic switching to sleep mode or manually turning monitors off is always the better energy-saving strategy.
• Turn off your computer and monitor when not in use.
• Unplug battery chargers when the batteries are fully charged or the chargers are not in use.
• Use the cool-down cycle to allow the clothes to finish drying with the residual heat in the dryer.
• When shopping for a new clothes dryer, look for one with a moisture sensor that automatically shuts off the machine when your clothes are dry. Not only will this save energy, it will save wear and tear on your clothes caused by over-drying.
• Turn off your personal computer when you're away from your PC for 20 minutes or more, and both the CPU and the monitor if you will be away for two hours or more.
• Visit http://www.energy.gov/applianceselectronics.htm for more tips.

A well-designed landscape not only can add beauty to your home but it also can reduce your heating and cooling costs. On average, landscaping for energy efficiency provides enough energy savings to return an initial investment in less than 8 years. If you were already planning to landscape, these tips provide an ideal way to beautify your home while saving on your monthly energy bill.

• Landscaping your home for energy efficiency can reduce your heating and cooling bills, the largest component of your home's energy use. Your overall landscaping strategy will depend on your regional climate.
• Plant trees to shade your home, reducing your cooling costs in the summer months. Typically, newly planted trees will begin shading windows in their first year and will reach your roof in years 5-10.
• Planting shrubs, bushes, and vines next to your house creates dead air spaces that insulate your home in both winter and summer. Plant so there will be at least 1 foot (30 centimeters) of space between full-grown plants and your home's wall.
• During winter, dense, low-lying trees and shrubbery on the north and northeast sides of your home can help protect your home against wind chill.  http://www.energy.gov/landscaping.htm

Statewide February Home Sales Improve from January Totals
Illinois Median Price at $141,000

SPRINGFIELD, Ill. — With a slight uptick from January data, Illinois home sales activity in February was marked by the effects of economic uncertainty. According to the Illinois Association of REALTORS® latest report, total home sales (which include single-family and condominiums) were up 8.9 percent in February 2009 to 5,097 homes compared to 4,678 homes sold in January 2009; sales were down 27.8 percent from February 2008 sales of 7,058. The Illinois median price in February was $141,000, down 20.8 percent from $177,950 in February 2008. The median is a typical market price where half the homes sold for more, half sold for less.

“Even though conditions are good for buyers with low interest rates and lower home prices, the job losses in Illinois and record-low consumer confidence has kept potential home buyers waiting on the sidelines for signs of improvement in the overall economy,” said REALTOR® Pat Callan, president of the Illinois Association of REALTORS®. “Looking ahead, REALTORS® are hopeful the stimulus measures such as the $8,000 tax credit will give buyers some confidence in the months ahead. The recent action by the Federal Reserve to buy additional mortgage-backed securities is anticipated to keep interest rates lower for a longer period of time.”

Adds Callan: “Reducing unsold inventories and the downward pressure on prices from distressed home sales will go a long way toward stabilizing home prices and lead to recovery in the housing market.”

The monthly average commitment rate for a 30-year, fixed-rate mortgage for the North Central region was 5.16 percent in February 2009, up 0.11 points from the 5.05 average rate during the previous month, according to the Federal Home Loan Mortgage Corporation. Last year in February it averaged 5.99 percent.

In the Chicago Primary Metropolitan Statistical Area (PMSA), home sales were up 3.9 percent to 3,082 homes sold in February 2009 compared to 2,965 home sales in January 2009; sales were down 28.8 percent from 4,326 home sales in February 2008.

The median home sale price for the Chicago PMSA was $183,625 in February 2009, down 23.5 percent from $240,000 in February 2008.

"The combination of the stimulus package and the supplementary relief to homeowners may generate some modest positive movement in housing sales over the next several months, but recovery in prices may continue to be delayed by the increasing unemployment rate that reflects a continuation in the deepening of the recession as well as an above national average level of housing stock (inventory) on the market in both Illinois as a whole and Chicago,” said Dr. Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory (REAL) of the University of Illinois.

Adds Hewings: "Employment forecasts for Illinois for the next 12 months suggest a further loss of 255,000 jobs; the estimated impact of the stimulus package on Illinois was for 145,000 jobs retained and added."

In the city of Chicago, February total home sales (single-family and condominiums) were down 40.4 percent to 841 sales compared to February 2008 sales of 1,412. The city of Chicago median price in February was $218,250, down 24.7 percent from $290,000 in February 2008.

“We believe the recent sales activity in the Chicago marketplace is indicative of strong interest by investors and bargain hunters in distressed properties. While some are looking for short sales and foreclosure deals to add to their portfolios, other smart buyers are finding starter-homes and investment properties at below-market prices,” said David Hanna, president of the Chicago Association of REALTORS®. “We welcome the absorption of foreclosed and short sale inventory as a stabilizing influence in those neighborhoods hardest hit by the downturn in the economy.”

Adds Hanna: “A close look at the sale of non-distressed properties shows buyers and sellers seem to be reaching a point of balance with pricing, especially in areas where showing activity has been strong. The greater question still unanswered is, when will we see evidence of the impact of the Obama housing plan and will this lead to more traditional market conditions as we progress through 2009.”

According to the IAR report, home sale prices were up in 27 of 98 Illinois counties reporting in September including Champaign, up 4.7 percent; Franklin, up 4.5 percent; Livingston, up 5.3 percent; McLean, up 3.9 percent; Monroe, up 14.6 percent; Sangamon, up 0.2 percent; Tazewell, up 2.3 percent.

Sales and price information is generated from a survey of Multiple Listing Service sales reported by 37 participating Illinois REALTOR® local boards and associations. The Chicago PMSA, as defined by the U.S. Census Bureau, includes the counties of Cook, DeKalb, DuPage, Grundy, Kane, Kendall, Lake, McHenry and Will.

The Illinois Association of REALTORS® is a voluntary trade association whose 53,000 members are engaged in all facets of the real estate industry. In addition to serving the professional needs of its members, the Illinois Association of REALTORS® works to protect the rights of private property owners in the state by recommending and promoting legislation that safeguards and advances the interest of real property ownership.

 Energy efficiency improvements that are eligible for a tax credit in 2008 are:

• Geothermal heat pumps (30%, up to $2,000)
• Solar Water Heaters (30%, up to $2,000)
• Solar Panels (30%, up to $2,000)
• Small wind energy systems (30%, up to $4,000)
• Fuel cells (30%, up to $1,500 per .5 kW of power capacity)

I'm often asked if this is a good time to buy a home. Some clients are concerned that home prices may fall further than they have already. They are assuming that the best course of action is to wait for the bottom in the market and then buy. The problem with this approach is that you don't know where the bottom is until you see it in the rear view mirror, meaning until you've missed it!

Home prices are one factor in determining your cost of ownership, but so are interest rates and financing availability. Even though interest rates have gone up in the last six months, they are still near historic lows. Since your monthly mortgage payment is a combination of paying down your principal and paying the interest owed, if home prices come down a little further but interest rates go up, it could cost you even more to service a mortgage on an identical home!

While a home is a major investment, it is also the center of your personal life. It's important to live in a home that reflects your taste and values, yet is within your financial "comfort zone." To that end, it may be more important to lock in today's relatively low interest rates and low home prices, rather than to hope for a further break in prices in the future.

Please give me a call if I can be of any assistance in determining how much home you can afford in today's market.

The Housing and Economic Recovery Act of 2008 was just signed by President Bush with some amazing benefits for first time homebuyers. Call everyone you know who wants to buy their first home (or who hasn't owned one in three years), this is too good to miss - it's a $7,500 tax CREDIT (not deduction but a credit).

If you have not owned a home in three years, you qualify as a first time home buyer. If you buy a home after April 9, 2008 and before July 1, 2009, you qualify for this credit. Call your friends who just bought a home since April 9th and tell them they may take $7,500 off their tax bill if they qualify. It has to be your principal residence, so rentals do not count.

The tax credit is 10% of the cost of the home, up to a maximum of $7,500. This is not an additional deduction that lowers the amount of income to be taxed, it is a tax credit. In other words, you take $7,500 off your tax bill. But there is a catch; the credit you receive now is actually an interest-free loan that must be repaid.

The loan has no interest, and will be paid back over 15 years. You get the credit on your 2008 taxes, but you start paying it back on your 2010 taxes that are due in 2011, so you get at least two years without a payment. You pay back 6.67% of the credit each year, so for a $7,500 credit the payment is $502.50 per year. If you stay put for 15 years, you pay it off with no interest.

What happens if you sell the house? You pay the balance back at the closing. So, you get $7,500 now, and pay the rest of it back if you make money on the sale of your house. What happens if you do not make enough money when you sell your house? They forgive the rest of the debt.

Other restrictions stipulate that you have to buy your first house in three years before July 1, 2009, not have super high income, not use bond financing and buy anywhere in the US.

If you'd like to learn more about this program, please call me!