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No takers yet for lot beside Obama home

Posted on 29 Oct 2009 | Comments Off

Owner inflating asking price to double what was paid 19 months ago

A vacant lot next to President Barack Obama’s Chicago home is on the market for almost double what the owner paid 19 months ago.

Unique location: There have been many inquiries about the eight-bedroom house to the north of the Obama home

The land was once owned by the wife of former fundraiser Antoin ‘Tony’ Rezko, who later was convicted of influence peddling, and was part of a US$1.75 million real estate deal that hurt Mr Obama’s election campaign. The 15-by-46-metre lot is being offered for US$1.3 million.

The opportunity to live next to the president hasn’t helped sell the house on the other side of the Obama residence. Those neighbours set a US$1.85 million price this week, seven weeks after putting their home up for bid.

‘The high-end market has taken more of a hit in this downturn,’ said Jim Kinney, vice-president of luxury home sales for Baird & Warner real estate in Chicago. ‘The whole stimulus package has been aimed at the bottom end of the market.’

Illinois real estate is showing signs of improvement. The Illinois Association of Realtors said last Friday that year-over-year sales increased in September for the first time since March 2006, with first-time buyers driving the rebound. September unemployment in the metropolitan area was 10.5 per cent, more than the national average of 9.8 per cent. Continue reading →

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US home prices may hit bubble

Posted on 29 Oct 2009 | Comments Off

The gains in US home prices in recent months may not be sustainable and increases in some areas of the country appear to be in ‘bubble territory’, an economist known for his property market expertise said on Tuesday.

Robert Shiller, an economics professor at Yale University and co-developer of Standard and Poor’s S&P/Case-Shiller Home Price Indices, told Reuters Television that he does not give quantitative forecasts on where home prices are headed but is concerned about the recent pace of increases.

Home prices in certain areas, such as Minneapolis and San Francisco, have risen by double digits over a mere four months, and if viewed on an annualised basis, they look like they are in ‘bubble territory’, Prof Shiller said. ‘It is a time of great uncertainty,’ he added.

US home prices in August rose for the fourth straight month. The Standard & Poor’s/Case-Shiller composite index of home prices in 20 metropolitan areas rose 1.2 per cent in August from July, topping the estimate of a 0.7 per cent rise according to in a Reuters poll.

‘The prominent fact that we are seeing with this data is that home prices are just zipping up,’ Prof Shiller said. ‘It is entirely possible that even with the bad news we are getting, home prices could start a major increase.’ Prices in the top 10 US metropolitan areas gained 1.3 per cent in August after a 1.7 per cent rise the previous month, according to the S&P composite index.

Source : Business Times – 29 Oct 2009