I was reading about the increase in Chicago's foreclosure in the Chicago Tribune today and while they have their numbers of the foreclosure rate and stating that it will get worst ...... what's the worst?  So, we have skyrocketed with foreclosures, the culprit:  ARMS and and then follows the missed payments.  The sky is falling is the scenario with this article.  But wait, STOP the PRESSES ......

Then the 3rd Quarter Analysis came out from the Chicago Association of Realtors.  Why compare the Chicago Association 3rd Quarter Stats against 47,000 anticipated foreclosures for year end in Chicago?  Here's why - when you look at the median pricing and it's just dropping down drastically or is it not?  Look at single family homes and the number that are selling right now.  Most high end homes, for instance, in Lincoln Square in Chicago, they just are not out there unless the seller needs to sell or the builder has turned the property over to the bank, or foreclosure.  So remove the high-end properties for Lincoln Square from last year and compare it to the properties that have closed this year ..... guess what I found out, while there is somewhat of a drop in median price, in the last ten years the Lincoln Square Neighborhood appreciated 209% and the last five years it appreciated 53%.  We are down in median price only because the upper bracket properties are not on the market. 

Okay, 47,000 and counting in foreclosures ....... yet, while 22 single family homes sold and closed in the 3rd quarter of 2006, and 2007 we had 34 single family homes sold and close, guess what?  Lincoln Square had 27 homes that sold and closed for the 3rd quarter in 2008. 

Alright, I'll try another neighborhood:  North Center in Chicago.  Appreciated 234% in the last ten years, 43% appreciation in the last 5 years and it's holding it's median!  In 2006 and 2007, 58 single family homes sold and closed in the third quarter and 64 sold and closed in 2008!

Here's the bottom, financing and underwriting is tightening up and rightfully so.  We have problems staying within our budget and have been spending an estimated 103% of what we make.  It had to stop and the foreclosures are a result of our greed - our need to have things that we can't afford or that we didn't want to save for and buy when we could afford.  The ARM's finally caught up and certain buyers/borrowers who were at the max on the initial rate on the ARM can't afford the payments, lost their jobs, and/or got out of control with the money honey!  We are in an adjustment period but know that 35% of American's own their home free and clear.  That the foreclosures and short sales are larger then light, maybe some of the short sales could have been renegotiated on rate and term with the bank but there is alot of denial, pressure, depression, guilt, etc. that is harbored by those who got caught up in this "I want" syndrome and now it is showing on the charts. 

If you own an investment property, increase your rents.  Get those units painted, looking fresh, clean, appealing, get that landscaping in the front yard - give yourself and the building some appeal.  What and how you are is what you will attract.  Those rental incomes are what will shoot the price and value of your property to the highest it possibly can.  There is no need to go into foreclosure or short sale - you need to reach out and get some help.  There are several ways to turn this area of your life around.  It's alot easier with a 2-4 unit then someone who has a condo or single family home that is in financial straights. 

Chicago, start thinking differently about how the sky is falling.  Don't think of it as doom and gloom.  Focus and think about this ....