When Your House Gets Too Big

As the Baby Boomers of the 1950s send their children off to college, they join the part of the market called "empty nesters". At this point they no longer need six bedrooms and three baths, a family room and a gigantic yard. Many "empty nesters" are trading in the family home for something that is smaller, easier to maintain and has the amenities that are important to their more carefree lifestyle. If you are considering such a move, start out by consulting a good Realtor whom you like and trust. The good news is--- when you sell your primary residence, you are not taxed on your profit if (1) you have lived in the home for two out of the last five years and (2) your gain does not exceed $250,000 as a single taxpayer or $500,000 as a married couple filing jointly. These capital gain exclusions apply whether you "buy up" to a more expensive home or "buy down" to a less expensive one. If you are moving downtown from the suburbs in order to be close to cultural centers, theaters and restaurants, there may be "quality of life" issues, such as noise or parking. Your Realtor can help you find a home that has all the conveniences and amenities you desire.

Our new mantra is - buy now with the best interest rates in 25 years, the best prices in two years, and fine inventory to choose from – so..you may sell a little lower, but you will buy much lower still!!

Sell low, buy lower…live where you want to live!!!

AND HAPPY NEW YEAR from The Tricia Fox Group

In New York, Fashion's Vacca Cuts Price to $8.9 Million

By CHRISTINA S.N. LEWIS
Fashion designer Domenico Vacca, who bought and renovated a New York City condominium earlier this year, and then relisted it, has now reduced the price to $8.9 million -- still 45% more than he paid.
In February, Mr. Vacca and his wife, Julie, paid $6.15 million for the unit, in the Museum Tower, and first listed the apartment for $9.5 million this summer. (In the 1980s, architect Cesar Pelli designed the Museum Tower, on top of the Museum of Modern Art's existing galleries, as part of an expansion plan.) With park and city views, the 3,250-square-foot unit has three bedrooms, three travertine-marble bathrooms and a large dressing room, according to the listing. The apartment can also be rented for $35,000 a month with a one-year minimum lease.
A. Gordon
Italian-born Mr. Vacca is known for his ties, bags and custom suits. At the 2007 Oscars, he dressed Best Actor-winner Forest Whitaker. Mr. Vacca has opened a handful of stores.
Carrie Chiang, of Corcoran Group, has the listing.
Qatar Sheikh Offers Big Apple Apartment
Elsewhere in Manhattan, Sheikh Abdul Aziz al-Thani, of Qatar, has listed his three-bedroom apartment at Trump Park Avenue for $14 million. Mr. Al-Thani paid $6.1 million for the 3,300-square-foot condo in 2005, according to property records.
On the fourth floor with east and southern exposures and full city views, the apartment has marble bathrooms, herringbone wood floors, walk-in closets and 11-foot ceilings.
The apartment is rented through June for $30,000 a month, and the building (pictured left) has maid service, valet service, a health club and closed-circuit security monitors, according to the listing. Carrie Chiang and Alexa Tirado, of Corcoran Group, have the sheikh's listing.
Meanwhile, Yankee Alex Rodriguez is asking $10 million for his renovated 4,600-square-foot unit in the same building. The All-Star third baseman originally asked $14 million for the home. Adam Modlin, of Modlin Group, has that listing.
The Federal Reserve Board's Dec. 3 "beige book," citing "a major residential appraisal firm," said that Manhattan apartment prices have fallen by 15% to 20% since midsummer, though thin volume muddied the picture.
Splash News
Trump Park Avenue
Hollywood Producer Furla Asks $3.5 Million in Chicago
Hollywood producer George Furla wants $3.5 million for his unfinished penthouse apartment in downtown Chicago. The listing calls him a "motivated seller."
Mr. Furla's long résumé includes this year's iteration of "Rambo" and "Righteous Kill," starring Al Pacino and Robert De Niro. Mr. Furla paid $3.15 million for the unit in 2005. The apartment is in the Fordham building on the Gold Coast, an area along Michigan Avenue that's home to a raft of new luxury condo developments. The producer's 6,200-square-foot, 50th-floor unit has a 1,500-square-foot terrace.
The listing says plans to finish the unit have been approved, but Mr. Furla never acted on them and is selling the space raw. The building has a bike room, doorman, a gym and other services. In 2005, actor John Cusack paid $2.9 million for a 45th-floor condo in the Fordham. Oprah Winfrey bought an apartment in a building nearby.
Tricia Fox, of KW Luxury Homes, has Mr. Furla's listing.

How does Chicago stack up?

How does Chicago stack up?

Video:
Olympics expert Ed Hula, founder of AroundTheRings.com, compares the four host city hopefuls for the 2016 Summer Games: Tokyo, Madrid, Chicago and Rio de Janeiro.
http://link.brightcove.com/services/link/bcpid1184417269/bclid3916906001/bctid1818365469

Paulson: Not contemplating 4.5% mortgage plan

WASHINGTON (MarketWatch) -- Treasury Secretary Henry Paulson said Tuesday that he isn't contemplating a plan to set a 4.5%-target mortgage rate for new home loans, though he acknowledged that the agency is working to lower mortgage rates.

"We didn't float any plan," Paulson told the CNBC cable channel. "I am always looking at new ideas and I have said from day one that the key thing to get us through this period is getting housing prices down."
Paulson responded to speculation that the Treasury would employ Fannie Mae (FNM, Trade ) and Freddie Mac (FRE, Trade ) to offer mortgages with rates as low as 4.5%. Instead of any 4.5% mortgage rate, Paulson expressed his support for the Federal Reserve's statement Tuesday that it would buy mortgage backed securities from Fannie Mae and Freddie Mac as a means of driving down mortgage rates.
"The Fannie Mae and Freddie Mac action is so critical," Paulson said.

Paulson defended the Treasury's controversial use of a $700 billion bank bailout fund authorized by Congress. Lawmakers were told the fund was needed for purchasing large quantities of mortgage backed securities, but instead he has allocated a significant amount of it to buy large minority stakes in financial institutions.
"Seeing what is it we've done to date is stop a string or cycle of financial institutional failures which could have gone to a downward spiral," Paulson said. "I am expecting no other major financial institution to fail."
Nevertheless, Paulson acknowledged that banks have not yet responded to the injections in the way he hoped they would by lending to consumers. "Everyone understands that they are not lending enough," Paulson said.
He also reiterated a plan to support consumer finance. Treasury announced Nov. 25 that it would use $20 billion of a the bank bailout fund to buy asset backed securities for a consumer-lending facility known as Term Asset-Backed Securities Loan Facility, or TALF.

The program, which isn't expected to start until January, is expected to provide liquidity to consumer loans such as student loans, credit cards debt and auto loans. It will be operated by the Federal Reserve.
"We at Treasury are willing to support consumer finance," Paulson said. "A lot of financing takes place outside of the banking system."

Zell expects housing recovery by spring

Tricia Fox Returns to Keller Williams Gold Coast

"Dear Seller": No Longer the Opposite of "Dear John:

Remember the good old-fashioned method of writing to the seller of a desirable house to plead your case? Check out this article for samples of missives that send another message: this is my final offer-- and here's why!

Good News, and a Conversion

Check out this analysis of real estate prices in the city. Meanwhile, real-estate journalist and longtime renter has a conversion experience and buys a house! Read about it here.

Sex (and Gender) and the City

Nothing seems to divide the sexes like "Sex and the City." The Chicago Tribune has advice for he-men who would rather "soak in a bathtub of lemon juice and slit our wrists with Manolo Blahnik credit-card receipts" than see the film. (For the ladies, the sidebar provides some lovely pictures of fashion at the London premiere). Meanwhile, The New York Times reports that even studio executives are stunned by the rate at which women are rushing theaters. Can we look forward to more spin-offs and/or imitations?...

Home Managers

Here's an interesting alternative to showing an empty home, which is never a good idea. Paradoxically, people are better at imagining their stuff in a place that is already full of someone else's stuff. To keep your property from becoming an anxiety-inspiring blank canvas even when you no longer reside there, consider hiring a home manager. S/he will live in and maintains the home in show-worthy condition, but can relocate at very short notice. Real Estate Bloggers report here.

What $1,000,000 Will Buy

If you are willing to take Sharm El Sheik in Egypt over Manhattan, you will get a lot more for your million bucks! Check out this entertaining slide show at Forbes showing exactly how far this sum will get you in today's international market.

New Construction Raises the Bar in New York

This entertaining article details the relatively recent phenomenon of New Construction Envy: the process whereby buyers who cannot afford granite countertops and spacious bathrooms nevertheless stubbornly refuse to settle for less -- at least not for a whole lot less money.

The Ribbon Has Been Cut!

Chicago's Trump Tower (official name: Trump Tower International) has celebrated the completion of its hotel; the condo floors are still under construction. Check out this video of the ribbon-cutting ceremony. The Trump tour is here -- fun stuff!

Another Look at Chicago Real Estate

Check out the latest article by Dennis Rodkin in "Chicago Dealestate." It gives both a helpful overview and specific regional insight into the latest figures. Informative for professionals and laypeople alike. As you will see, the Gold Coast area has increased over 10% since last year. As Dennis says, don’t heed the Chicken Littles until you are fully informed!!

Commute? No Thanks

Suburban properties are dropping in value at a much higher rate than urban pads. In a buyers' market, it turns out buyers don't want to be out in the sticks! The old adage "drive until you qualify" is facing modification as consumers realize that commuting brings its own costs, in money (e.g. gas) as well as time. Thus the new formula: "The longer the commute, the steeper the drop in prices." The good news is for urban centers, which are continuing to see their property values rise. Listen to the story here.

Time to Rebalance?

Check out these investment tips from the master of Yale's endowment, who has a few ideas about how to keep your cool even in bad times.

Money=Happiness?

For years, the Easterlin paradox has been the received wisdom in economics: that while poverty increases unhappiness, a higher income does not guarantee contentment once basic needs have been met. Now the NY Times reports on a new study that questions this premise. In sum:

"Economic growth, by itself, certainly isn’t enough to guarantee people’s well-being — [...]
But it would be a mistake to take this argument too far. The fact remains that economic growth doesn’t just make countries richer in superficially materialistic ways."

As examples, the author cites scientific research and access to travel, and concludes: "At a time when the American economy seems to have fallen into recession and most families’ incomes have been stagnant for almost a decade, it’s good to be reminded of why we should care."

Life Laundry

There is no time like the present -- but especially if you are selling your house or contemplating a move -- for getting organized. Check out these recommendations from Slate on where to go for advice.

The Round Price Is Right

According to a study by researchers at Cornell University, consumers are attracted to precise prices when they make purchases -- even and especially real estate. Listen here.

The Credit Squeeze: Who's in, Who's out

Check out this Chicago Tribune article for guidelines on how loan programs are evaluating borrowers. There is still credit out there for "niche" buyers.

Designers Guild

For those of you who are weathering out the storm of the weak dollar with your secret stash of British pounds -- you know who you are -- or for those of you who just like to browse the world of interior design, check out the website of Designers Guild -- great stuff!

The Audacity of Hope?

A rare thing these days: a fairly upbeat (but not pollyannish) opinion piece regarding the investment value of real estate.

America: the New Japan?

This op-ed piece in the New York Times lays out some troubling parallels between the economic policies in 1980s Japan and 1990s America. Does this mean that we will also share Japan's fate -- namely, recession? See what you think.

Recycled: Don't Fear the Repo

An article by Daniel Gross published almost two years ago in Slate is not only proven prescient, but still has relevance for the current situation (including the McMansion crisis...). In short, it answers the question: why are banks so slow to move in and foreclose? Take a look...

Real Estate Voices

If you like a story here then submit your vote on RealEstateVoices.com:

The Next Slum?

Check out this article from Atlantic Monthly for a smart take on future trends. We all know McMansions can be an eyesore, but that may only be the start of their nuisance potential! Time to move downtown if you haven't already...
On the related topic of the Levitt bankruptcy -- that's Levitt of Levittown, one of the first outposts of surburbia -- give this NPR story a listen.

How the Stimulus Plan Helps Sellers

The stimulus plan approved by Congress last week will be a big boon for those attempting to sell their home in high-priced areas, reports The Real Estate Bloggers.

Two Chicagoans on the National Stage

This is not ordinarily a place for politics, but it is hard to resist noting that on Super Tuesday we have not one but two native children in the final running...did you know that there is in fact such a thing as a Hillaryburger? Listen here.

The Next Big Thing: Storage Condos

Where to go with all those mantoys when you "downsize" to a smaller home or condo? How about a storage condo, where, as the Times puts it, you can store your gear and play with it too. Forget the sterile atmosphere of yesteryear; these units come with"cable television, high-speed Internet, individual thermostats and even clubhouses." You might be surprised how many people watched the superbowl from one of their units!

Foreigners Investing Heavily in U.S. Real Estate

For the first time, U.S. cities rank one and two in the top five places assigned by the Association of Foreign Investors in their annual survey. New York is number one, followed by Washington D.C. in a tie with London for second place, followed by Paris and Shanghai.

Oops? They Did It Again

The Federal Reserve has cut interest rates again. See the NY Times coverage here. As NPR's "All Things Considered" explained on Monday, bad real estate numbers can be good news for Wall Street: this access to quick cash is just what investors were hoping for. Are there more cuts to be expected in the near future? Watch this space. For more on what the cut means for consumers, go here.

I Like the "Starts"

Chicago Real Estate Daily is reporting that a room at the new Trump hotel starts at $325....it goes up to $1425, though I am sure you can add on to that tab pretty easily. This is however actually lower than the starting rate at Trump's two main competitors, the Four Seasons and the Peninsula. Anyone who has tried them all out is welcome to post a comparative review here! We are all ears!

United We Fall?

The "Today's Papers" header at Slate was so cute, and apt, that I had to steal it -- with the addition of a question mark. The point, of course, concerns the nausea-inducing drop in world stock markets as an indication that the global market is more interdependent than perhaps many of us would like: European and Asian investors seem to be unnerved by rumors of an imminent U.S. recession. As "The New York Times" puts it, in a passage "Slate" cites as well: "The angst about the United States belies the popular theory that Europe and Asia are not as dependent on the American economy as they once were." It might be more precise to say that what it belies is the theory, popular or not, that Europe and Asia do not believe themselves to be independent of the U.S. Whether that accurately reflects the facts is another matter, and one that remains to be seen. Of course James Carville's law of politics -- "It's the economy, stupid"-- becomes, when applied to the economy: "It's psychology, stupid!" --But there may still be time for investors to rally and come to their senses, a possibility the Times acknowledges with its follow-up article today: "To Some, the Widening Crisis Seems Driven By Fear, Not Facts."

The Plan

Click here for part two of Jack Guttentag's two-part article on the federal government's plans for dealing with the subprime crisis.

Florida? No Thanks!

Hard as it may seem to believe, some people actually choose to vacation in Chicago in the dead of winter. From ice skating in Millenium Park to browsing the shops on Montrose Avenue in Ravenswood, there is plenty to do in this city of ours without being overrun by those creatures no one wants to see, much less admit to being (i.e. tourists). Go here to post your own tips!

Baroque Chicago?

Check out this NY Times article on the anti-minimalist Richard Dreihaus. The Richard H. Driehaus Museum of Decorative Arts is due to open in the spring in the Nickerson Mansion, quite possibly "the most expensive residence ever built in Chicago." Watch this space for details.

Looking for a NY Landmark?

Former art dealer Lawrence Salander is selling his townhouse, former residence of writer Lillian Helman, pending court approval (Salander declared bankruptcy last year). For a cool $25 million, the place could be yours!

Looking for a Good Investment? Follow the Artists

Business Week is running an interesting feature on the way that artists tend to upgrade neighborhoods -- until they add so much value that they (or at least the struggling ones) price themselves out of a home (e.g. Greenwich Village in New York). The magazine has put together what it calls the top ten places for artists. I'll ruin the suspense and tell you that Chicago is not on it, but the trend holds for our city as well!

Waterview Tower

One of my fav’s of the few new buildings offering hotel amenities along with terrific condos with unstoppable views..

There's always Ikea!

Ikea: it's not just for decorating anymore! Comedian Mark Malkoff has moved into a New Jersey Ikea warehouse while his Manhattan apartment is being fumigated. (His live-in girlfriend will not be accompanying him. Malkoff's comment: "For some reason, she didn't want to live in a store.") Follow Malkoff's progress (?) here.

Chicago: Capital of Straight Talk?

Does anyone have any thoughts as to why President Bush chose Chicago as the place to drop his "What, me worry?" stance and admit that the economy is in trouble? The threat that Bush acknowledged is a "reality" is three-pronged: rising oil prices, the job market, and the home mortgage crisis. For a very informative look at the latter, check out the first part of a two-part series by "The Mortgage Professor," aka Jack Guttentag, over at Inman news.

Tips for Sellers

For those of you trying to sell your home, the news is not all bad. Check out these tips from "Forbes" on marketing an upscale property in downscale times. Number One: make sure the price is right!!

Chicago: A Buyers' Market

"What's not to like?" asks an article in the Sun Times News Group -- at least for buyers, the Chicago real estate market is a friendly place to be:

Buyers in the Chicago area have perfect conditions for looking right now, said Laura Ellis, senior vice president of sales for Baird & Warner. "It's a great time to get a great deal. Interest rates are fabulous -- bouncing around 6 percent -- and there is plenty of financing available."There's a great selection of properties on the market, so buyers can take their time and find the right house and a good deal," Ellis said.

Sellers find themselves in a challenging market. "If you want to sell your home in today's market," Ellis said, "you really need to hire a professional agent who knows what they're doing. There are simply more homes out there and sellers need to price their homes correctly, present them properly and market them professionally."

It bears repeating: the moral is not simply to be a buyer rather than a seller, but to get professional help on either end!

The Sky is Not Falling, Part II

The folks over at Real Estate Bloggers have crunched some numbers and come up with some good tidings for the New Year. Their conclusion:

Housing prices in most major cities are still showing long term gains even in the face of a difficult market.

(The bold print is in the original: one has to speak loudly to be heard in this climate!)

Chicago is no exception, but rather a prime example of this trend. Happy New Year!