May/June 2002

The State of the Real Estate Market

BY PAULA ARNETT

The accompanying chart* shows more activity in the first quarter of 2002 compared to 2001 in the Sheffield neighborhood. While more property came on the market in 2002, it was due to more condos being for sale, rather than single family and multi-unit buildings.

A 22% increase in property going under contract occurred, but a decrease in the number of multi-unit buildings. For closed property, there was an increase of 48%, but again a decrease in the number of multi-unit buildings. This decrease is due to many multi-units being converted to single-family homes. This increase can be attributed to the slow real estate market in the fall of 2001, due to the September tragedy.

Interesting FYI’s

Highest price paid to date for a Tear Down was in the 2200 block of Fremont for $1,575,000 in January 2001 (34’x124’ lot). Most current Tear Down is in the 2100 block of Clifton that closed at $740,000 in February 2002 (25’x125’ lot). Other recent Tear Downs are: 2200 block of Janssen with no public record of a sale (25’x128’ lot); and 2300 block of Wayne, $540,000 in February of 2001 (24’x124’ lot).

Two buildings that have been on and off the market since 1998 in the 2100 block of Magnolia are under contract as of March 2002 with current list prices of $995,000 for the corner building, and $750,000 for the building to the north, the former German Hungarian Bakery. In addition to the 2 vacant lots (45’x125’) across the alley on Lakewood are also under contract, with a list price of $1,300,000.

*Data compiled from Multiple Listing Service of Northern Illinois

March/April 2002

Defer gain on investment real estate

BY PAULA ARNETT

Use of the Internal Revenue Code 1031 is one of few remaining ways to build equity in commercial and investment real estate. Through it, gains on real estate are deferred for income tax purposes.

Under International Revenue Code 1031 (a) (1), there are three prerequisites for a tax-deferred real estate exchange:

1. Both the property transferred and that received must be held for productive use in trade or business, or held for investment.
2. The property transferred and that received must be of a “like kind,” the distinction between real property and personal property.
3. The transaction must be solely property for property, an exchange. It may not be a sale and a subsequent purchase. The taxpayer must invest at least as much money in the new property as he/she receives in the sale of the relinquished property. And he/she must borrow at least as much money to purchase the new property as he owned on the old one.

The seller has 45 days (which begins on the date he/she closes on the relinquished property and ends on the 45th day) to identify the new property. He/she has 180 days to complete the exchange or close on the replacement property.

There are many Qualified Intermediaries who can process the transaction. It is best to seek counsel from your own independent tax advisor, tax attorney and/or CPA as to the tax consequences and implications of the Code.

January/February 2002

Do you remember?

BY PAULA ARNETT

The Sheffield neighborhood has certainly changed over the years. According to an article written July 14, 1976, in the now-defunct Chicago Daily News, the headline states “Halsted is coming back.” At that time, the 2000 and 2100 blocks of Halsted had the greatest burst of activity where five antique shops, a boutique, an art gallery and a storefront theater opened the year prior, replacing blacked-out storefronts, drug trafficking and street-gang fights. The rents were rising but lower, about $400, than those charged in Old Town and New Town, about $1,000. Apartment rentals along the street climbed in the high $300’s. A single-family house on Dayton sold for $175,000.

Prior to Halsted’s resurgence, several boutiques and antique shops opened on our now-trendy Armitage Avenue. Low rent was the attraction then.

Other shops mentioned include Otto’s Beer House and Garden at 2024 N. Halsted, now Café Ba-Ba-Reeba!, a Lettuce Entertain You restaurant, and a “live-work” building at 2128 N. Halsted (a former 19th Century police station) that is now The Gap.

Other shops no longer remaining include the Puppet Place, the Chicago Gallery, the Herbanite, Just Whistle boutique and five antiques shops: Quercus, Owl’s Nest, In the Manner Of, Antiquery Warehouse and Junk Man Antiques. The restaurant, Café Bernard at 2100 N. Halsted, remains today.

November/December 2001

Recent Real Estate Statistics

BY PAULA ARNETT

Yes, the real estate market is different from last year’s. So is everything. The accompanying chart shows the number of transactions* that occurred in the Sheffield neighborhood in the third quarter of this year compared to last year.

You can see that there have been more listings, more properties under contract and more properties closed this year compared to last year. This year there are more sellers than there are buyers.

Most interesting is that of the three single-family homes that went under contract in the third quarter of 2001, none was over $1 million whereas in the third quarter of 2000, of the six single-family homes that went under contract, fiver were over $1 million.. In addition, of the 10 single-family homes that closed in the third quarter of this year, only 3 were over $1 million whereas in 2000, 5 of the 8 were over $1 million. Of the single-family listings in the third quarter of 2001, 7 of the 22, or about one-third, were over $1 million compared to 2000 where 7 of the 15 or about half, were over $1 million. That’s only single-family home statistics.

Helpful Hint: All residents of the 43rd Ward can request “No Parking” signs for your moving van on the day of your move for up to five parking spaces. Call Alderman Vi Daley’s office at 773/327-9111 at least five working days prior to your move to request the signs. Streets and Sanitation will post the signs the day before the move to give neighboring residents 24-hour notice of the No Parking restriction.

*Data compiled from the Multiple listing Service of Northern Illinois.