Attorneys practicing in and around the Chicagoland area. Experienced in the practice areas of Real Estate Law, Mortgage Foreclosure Defense Litigation, Social Security Disability, Business Law, & Estate Law.

 - Attorneys practicing in and around the Chicagoland area. Experienced in the practice areas of Real Estate Law, Mortgage Foreclosure Defense Litigation, Social Security Disability, Business Law, & Estate Law.

Is Tax Code Uncertainty Affecting the Illinois Real Estate Market?

Home For Sale

In this post, we discuss theories offered by real estate agents as to why homes in Illinois are taking longer to sell in 2019 than last year. 

Homes in Illinois are taking longer to sell in 2019. Some real estate agents are offering possible reasons as to why this is.

 

Why are Illinois homes taking longer to sell?

Some real estate agents have a theory as to why it’s taken longer for homes to sell over the winter and spring.

Many agenst are saying the real estate slowdown is a response to buyer uncertainty about how recent tax code changes will affect what people can afford.

“There were huge changes, and people aren’t sure what it means for them until they file this year,” said Greer Haseman, an @properties agent based out of Oak Park, Illinois.

The slowdown has been noticable in Oak Park. In the first months of 2018, Oak Park homse sold in 92 days on average. In the same months of 2019 that average has jumped to 120 days.

Buyers “don’t want to plan what to spend until they know all the implications (of the revisions) on their family’s finances,” Haseman said.

 

Uncertainty is slowing the Illinois real estate market

Open House signThis question over tax code changes has added another uncertainty to the housing market in the Chicagoland region.

Another major factor is property taxes. Illinois already has the second highest property taxes in the nation. With the state economy facing serious debt and cities and counties facing budget shortfalls, fears about increased property taxes are definitely a concern.

Many economists are also concerned about the possibility of another recession. Some are projecting it could happen and that is probably keeping some buyers on the sidelines.

The uncertainty over how the new tax code will alter home budgets, “is limited to this winter,” said Jordan Chalmers, a Baird & Warner agent based out of Lincoln Park. “But it’s uncertainty, and any market dislikes uncertainty.”

 

The people most unlikely to hold off on buying a new home because of market uncertainty are upper income buyers. They are the most likely buyers to be impacted by the recent $10,000 limit on state and local taxes that can be claimed for a deduction.

 

Affects of uncertaintly not the same in all areas

Home for saleIn Lake County, Will County, and the city of Chicago, the average time a home is on the market has been longer in the first two months of 2019 than during the same period in 2018.

Only in DuPage County has the average time on market actually been shorter than last year.

The increases in market times may not always be huge, but the housing market in the Chicago area has not been as strong in other parts of the country. There is less room in this delicate market than in other places, and any swing in sale times or prices is felt more strongly here.

Recent increases in the number of homes for sale in some areas have left less-competitive houses to remain on the market longer.

Nobody likes to blame the weather but a long, tough winter definitely didn’t help things either.

Hopefully anyone who was waiting for better weather will start their house hunting soon.

 

Law Offices of Lora Matthews Fausett, P.C.

If you require a real estate attorney in Naperville to represent you with any issues related to buying a home or property there, the Law Offices of Lora Matthews Fausett, P.C. are well trained to handle matters relating to buying and selling, short salescommercial leases, as well as foreclosure defense and many others.

 

For Information Call 630-858-0090


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


Illinois Ranked 41st Most Affected by Government Shutdown

Photo by Max Pixel

A new analysis of the 35-day partial government shutdown shows that Illinois ranked number 41 among the 50 states and the District of Columbia on how it was affected by the shutdown.

According to an analysis by WalletHub.com on how the states were affected by the federal government shutdown, Illinois ranked Number 41.

The study gave Illinois a score of 24.76 out of 100.

The factors that the analysis was based on were: share of federal jobs, federal contract money per capita, share of families receiving food stamps funds, real estate as a percentage of the state economy (since mortgage processing hinges on federal agency staffs) and residents’ access to national parks.

The study found that “blue states” were slightly more affected by the shutdown than “red states” were.

The average ranking for “blue-leaning” states was 24.81, while the average for “red-leaning” states was to 26.83.

The federal shutdown that recently ended January 25th set the record for the longest government shutdown.

 

Which Jurisdictions Were Most Affected by the Shutdown?

Rank (1 = Most Affected) State / Territory Total Score
1 District of Columbia 78.59
2 New Mexico 65.95
3 Maryland 65.70
4 Hawaii 62.91
5 Alaska 61.08
6 Virginia 56.61
7 West Virginia 46.25
8 Mississippi 45.56
9 Alabama 43.46
10 Arizona 40.73
11 Rhode Island 37.74
12 Montana 37.28
13 Maine 36.57
14 Florida 36.25
15 Oregon 36.08
16 Oklahoma 35.87
17 Kentucky 35.81
18 Washington 35.71
19 Georgia 35.50
20 Wyoming 33.01
21 South Carolina 32.88
22 South Dakota 32.62
23 Tennessee 32.55
24 Louisiana 32.36
25 Idaho 32.20
26 Missouri 32.15
27 Vermont 30.46
28 Texas 29.59
29 Utah 29.05
30 Connecticut 29.00
31 Colorado 28.42
32 Nevada 28.35
33 Pennsylvania 27.20
34 Massachusetts 27.09
35 New York 27.08
36 Delaware 26.98
37 California 26.65
38 North Carolina 26.64
39 Arkansas 25.82
40 Michigan 24.96
41 Illinois 24.76
42 Ohio 24.66
43 North Dakota 23.69
44 New Jersey 19.30
45 Kansas 18.84
46 Wisconsin 17.56
47 Indiana 17.02
48 Iowa 16.49
49 Nebraska 16.40
50 New Hampshire 15.59
51 Minnesota 10.54

Source: WalletHub.com 

 


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


 

The Law Offices of Lora Fausett P.C. provides real estate law services including loan modificationsbuying and selling assistanceshort sales and deeds in lieumortgage foreclosure defense, and more.

Located in Glen Ellyn, Illinois and serving clients in DuPageCookKane, Will, and Kendall Counties.

For Information Call 630-858-0090


 

How the Government Shutdown Affects Real Estate and Mortgages

Photo by Max Pixel

In this post, we discuss how the government shutdown is affecting real estate transactions and mortgages.

The U.S. government shutdown is affecting more than just federal employees.

The shutdown is also affecting some homebuyers, lenders and real estate agents, who are seeing their closings delayed.

If the government shutdown turns out to be a long one, it could damage the housing market, which in some parts of Illinois is still struggling to gain momentum.

According to Lawrence Yun, chief economist with the National Association of Realtors, the shutdown is already causing uncertainty and hurting consumer confidence.

“For ordinary Americans, the shutdown adds to economic uncertainty about their future,” said Lawrence Yun. “Buying a home is a high-anxiety transaction, and by adding another complexity to it with possible delays in [the transaction], it hurts the economy and hurts consumers.”

Below is a list of how a continued government shutdown could impact your real estate transaction.

 

Real Estate Transactions Impacted by Shutdown:

  • FHA loans could be delayed
  • USDA loans will not be processed
  • Delays in IRS transcript and Social Security reporting

 

Real Estate Transactions Not Affected by Shutdown:

  • Fannie Mae
  • Freddie Mac
  • VA Loans
  • Flood Insurance

 

First Time Home Buyer Mortgage WorkshopFHA Loans

Loans insured by the Federal Housing Administration (FHA) and U.S. Department of Veterans Affairs (VA) are typically not impacted by government shutdowns.

However, with less staff working at the FHA, some borrowers may see a closing delay due to the increased backlog.

 

USDA Loans

The USDA will not issue new Direct Loans or Guaranteed Loans.

Scheduled closings of Direct Loans have been canceled and unless your guarantee was previously issued for a Guaranteed Loan, those may not be closed, depending on your lender.

Check with your lender if you are getting a USDA loan or planned to use the USDA program to buy your home.

You may have to delay your home purchase until the shutdown is resolved.

 

Veteran Homeowner ExemptionVA Loans

VA staffers who approve the VA loans are paid through borrowing fees and are not impacted by the shutdown.

 

Social Security Reporting

To process a mortgage application, lenders will verify that your Social Security number is valid with the Social Security Administration.

Because of the delays expected in processing these requests, government-sponsored agencies have relaxed their rules to allow lenders to submit these reports prior to loan delivery rather than earlier in the loan process.

If your Social Security number cannot be validated prior to this time, however, your loan may be denied.

 

mortgage applicationIRS Transcripts

Lenders usually have borrowers sign an IRS request for a transcript of tax return (Form 4506-T) at or before closing.

The IRS is not processing new requests for transcripts during the shutdown.

Lenders are not required to have the transcripts at closing and, in many cases, can add the transcripts to your loan file after closing.

 

Federal Flood Insurance

New legislation was passed in December 2018 in order to extend the National Flood Insurance Program (NFIP) through May 31.

FEMA, which oversees the NFIP, is still selling and approving new policies.

 

Property Tax Assessment - CalculatorFannie Mae and Freddie Mac

The shutdown does not impact loan processing at Fannie Mae and Freddie Mac because they are not funded by the government.

However, the issue is that verification of employment is a key requirement to get a loan from these agencies.

If you are a federal worker or contractor, your lender may not be able to get a verbal verification of employment from your government employer prior to loan delivery.

This could cause your loan approval to be denied or delayed because your employment and ability to repay have not been fully vetted.

 

Article Source: How the government shutdown is disrupting mortgage, real estate transactions – BankRate.com


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


 

The Law Offices of Lora Fausett P.C. provides real estate law services including loan modificationsbuying and selling assistanceshort sales and deeds in lieumortgage foreclosure defense, and more.

Located in Glen Ellyn, Illinois and serving clients in DuPageCookKane, Will, and Kendall Counties.

For Information Call 630-858-0090


Real Estate Technology – What Lies Ahead?

real estate technology

Photo via Max Pixel

In this post, we review eight real estate technologies that have the potential for changing the industry in 2019 and the upcoming years.

There is no doubt that the real estate industry looks much different than it did ten years ago.

Ten years ago the industry was already different than it was ten years before that.

The real estate market keeps evolving. Tastes change, the economy fluctuates, laws change, and most of all, new real estate technologies are continuing to change it further.

Forbes magazine recently ran a story about developing real estate technologies and what is ahead for the industry.

We will examine what Forbes considers to be the biggest changes that technology will make on the market so that you can understand and begin to prepare and adapt.

 

Biggest Real Estate Technology Trends

  • Amazon-Like Closings
  • Streamlined Processes
  • Transactions Without Middle Men
  • Realtors As Consultants
  • Growing Digital Endorsements For Residential Loans
  • DocuSign, Google Maps And VR Technology
  • Improving Access To Facts
  • More Efficient Investment Cycles

 

Amazon-Like Closings

Using real estate technology on smartphoneReal estate buyers now have access to most of the same tools that realtors have. This is creating more and more transparency in the buying process.

New technologies will continue to minimize the paperwork, maybe eventually to the point where closings take place online in an “Amazon-like” vehicle for real estate.

Landlords will be able to use many tools including unlocking doors to even conducting the entire rental process online.

People will still want to visit a property in person though, so realtors will play a role similar to car dealers do today.

Prediction by Holly Williams, MQ Ventures, LLC

 

Streamlined Processes

The buying and selling process has changed for the better because of tech advancements over the past ten years.

Today buyers and sellers can use search engines, comparison databases, virtual home tours, and 3D floor plans for information gathering and education.

We can assume that the purchasing process can benefit from new technologies as well.

“I envision the process of purchasing to benefit greatly — tech advancements can streamline the process and memorialize it in a more efficient manner than currently occurs municipality to municipality, state to state, to a more formal and standardized system.”  Prediction by Stephen Kliegerman, Halstead Property Development Marketing

 

Transactions Without Middle Men

Real Estate red tape

Photo by Max Pixel

Blockchain looks to be the biggest technological disruption to real estate processes.

This could allow for real estate transaction without all of the middlemen that are typically involved in a property closing. This major change still could be decades away. – Prediction by Meg Aubale Epstein, Ca South Development.com

 

Realtors As Consultants

The industry has begun to change faster than many real estate agents have come to realize.

It is more important than ever for real estate professionals to provide real value.

“Technology will likely thin the overcrowded market of part-time real estate agents while those who are experienced, knowledgeable and dedicated will maintain a space from transactions built from solid relationships. I believe at some point real estate agents will offer more of a consultative approach to the transaction.” – Sheryl Houck, eXp Realty, LLC

 

Growing Digital Endorsements For Residential Loans

Illinois home with tax lien“I expect that more and more residential loan closings and their associated security instruments will be endorsed digitally. However, I don’t think it’s as likely to see commercial transactions follow suit as quickly.” – Brad Moree, Moree Law, PLLC

 

DocuSign, Google Maps And VR Technology

We are already seeing wide adoption of DocuSign within the real estate industry, which has helped speed up the signing process.

Newer technologies such as Google Maps, drone videos and Virtual Reality are already helping with properties that are geographically too far to visit, which has cut down on time and expenses.

We will continue to see wider and regular usage, as well as other emerging technologies to help with property buying, selling and management without having to physically travel to a location. – Prediction by Robin Bhalla, The Festival Companies

 

Improving Access To Facts

Home lending days“The main goal of technology should be to help agents and consumers make more informed decisions more efficiently. Interpreting this information and the soft skills required to make deals happen in a shifting market will still be the value-add that agents bring. Technology will help us with the facts and stats, but can’t account for the emotional side of deal-making and marketing in a shifting market.” – Kofi Nartey, The Nartey Group – Compass

 

More Efficient Investment Cycles

“I believe that technology will insert efficiencies into the entire investing lifecycle. From deal sourcing to underwriting, managing assets and even disposition, big data and machine learning can transform the speed and accuracy of real estate transactions and have a significant impact on investors’ bottom line.” – Guy Zipori, Skyline AI

 

The predictions in this blog post are based upon an article that appeared on Forbes.comfi in November 2018. 

 


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


 

The Law Offices of Lora Fausett P.C. provides real estate law services including loan modificationsbuying and selling legal assistanceshort sales and deeds in lieumortgage foreclosure defense, and more.

Located in Glen Ellyn, Illinois and serving clients in DuPageCookKane, Will, and Kendall Counties.

For Information Call 630-858-0090


More Americans Using Real Estate Agents

Real estate agent with keys

In a study that surprised many, a larger percentage of Americans than ever are using real estate agents to buy and sell their homes. 

Conventional wisdom had been saying for years that the internet and new technologies were going to result in fewer people turning to real estate agents for help in buying and selling their homes.

It was assumed this would be especially true for Millenials, that they would turn to websites and apps to buy and sell their homes.

However, the opposite has turned out to be true. Millennials are actually more likely to use a real estate agent today than Baby Boomers are.

 

Key Findings

Home lending daysThe most noteworthy finding in the study conducted by Harris Insights & Analytics was that in 2018, a full 90% of consumers used real estate agents to buy and sell their homes.

That was the highest percentage of agent-assisted buyers and sellers that this ongoing study has recorded.

That 90% figure was a 5% increase over 2014, when 85% of consumers used real estate agents to buy and sell their homes, and a 9% increase from 81% when this ongoing survey was first done in 2001.

 

Real Estate Agent Usage by Age Group

For several years there has been a discussion about how Millenials would change the home buying and selling market.

Home for sale

It has been assumed that that generation would abandon using real estate agents in favor of searching for homes using only websites and web apps.

However, the data in this study showed that Millenials were extremely likely to use a real estate agent.

According to study data, 91% of buyers and sellers from ages 18 to 34 used real estate agents in their transaction.

Surprisingly, Millenials were even more likely to use a real estate agent than Baby Boomers (ages 54-72) were. Just 81% of consumers ages 55 and older reported having used a real estate agent in their transaction.

Gen Xers (ages 35-50) were the most likely to use a real estate agent, at 94%.

 

Real Estate Agent Usage by Education and Income

Another key finding was that higher educated and higher income earners were the most likely to use a real estate agent.

94% of people with a college degree used the service of an agent. Only 83% of those with a high school degree used a real estate agent.

98% of people earning $75,000 or more used a real estate agent, while only 79% of those who earned $50,000 a year or less used an agent.

 

How Consumers Choose an Agent

How does this increased number of people using real estate agents choose one?

“Referrals from people I trust” was the most common answer. A large majority, 69%, of said a referral was either extremely important or very important. A full 92% said it was important in their decision.

The second most common answer was “agents who had listings like my home”. 64% of consumers said this was a factor.

62% said “looking at websites with ratings of agent’s performances” was a factor.

“Having a personal relationship with the agent” came in fourth with 57%.  In fifth place at 52% was “member of a Realtor organization.

 

Realtors Are Important, But So Are Websites

How People Find a Real Estate AgentThe majority of consumers still depend on a real estate agent to buy or sell a home.

However, websites have become extremely important for consumers when searching for homes or realtors. 92% of consumers reporting using websites for information about real estate agents.

 

Top Websites for Finding Real Estate Agents

  • Realtor.com
  • Zillow.com
  • Google.com
  • Facebook.com
  • Loopnet.com

Most Visited Real Estate Websites

  • Zillow.com
  • Truglia.com
  • Yahoo! Homes
  • Realtor.com
  • Redfin.com

 

About the Study

The new housing consumer study was conducted by Harris Insights & Analytics.  It was underwritten by the California Association of Realtors, The CE Shop and REAL Trends.

The study measured the responses of 1,000 people who had bought or sold a home during the previous six months of 2018.

 

Sources
More Americans are using real estate agents than ever before – Houseingwire
Top 15 Most Popular Real Estate Websites May 2018 – EbizMBA
Buyers and Sellers Still Need You – Realtrends
90% of all Buyers and Sellers Used an Agent, Up 9% From 2001 – Realtrends

 


* Advertising Material: To the extent that the information in this post is interpreted as attorney advertising in accordance with the Illinois Rules of Professional Conduct or within the meaning of state bar rules from all other localities, this statement is made pursuant to those rules.

Specialties: Specialization claims are prohibited by Illinois Supreme Court Rules and we do not claim to be specialists. The content of this e-mail is organized and presented for the sole purpose of general information. None of the included content should be construed as legal advice. Viewing this e-mail or e-mailing the account holder does not create an attorney-client relationship. NOTICE: This page may be considered advertising material.


 

The Law Offices of Lora Fausett P.C. provides estate law representation, including power of attorneyliving willsprobate law services, trustswills, and more.

Located in Glen Ellyn, Illinois and serving clients in DuPageCookKane, Will, and Kendall Counties.

For Information Call 630-858-0090