Oak Lawn IL Real Estate News

I received a call today from an owner of a couple of investment condos at Arbor Court located at 5100 W. 96th St., Oak Lawn, Illinois, right behind the Metra train station.  This is one of 3 new condominium complexes located within walking distance to the train station taking commuters to jobs located in Chicago’s downtown area.

At first I thought this was a seller that was asking for a listing appointment, but I found out the property had already been listed and was currently active in the Oak Lawn MLS.  What compelled me to write about this in my Oak Lawn blog was the fact that he seemed impatient since the listing had already been up for 90 days without an offer.

I truthfully explained that I currently am not working with any buyers for his units and assured him that if I did I would be showing his condos if it was within my buyer’s price range and had the right amenities.  He wanted me to actually sit down with his co-investors and him or at least have a conference call so they could introduce me to their available units.  I told him I have shown units in the building and also at the 51st Ave. complex and I was familiar with both complexes.  In other words, I did not need to take time to meet with sellers or even participate in a conference call since these units are already listed in our MLS.

I would have liked to tell him more but I was driving and on my way to an appointment and just didn’t have the time to educate someone else’s seller client.  I would have liked to say that I would not have made those investments, even though he is not the only one that did.  There are many investors of these new complexes who figured these were hot properties that would be quick and easy to “flip.”

However, there are still builder units available and a sales office is still open in the building.  Add to that the slowing market with top end priced condominiums and 90 days isn’t a very long time to be on the market at all!  In fact, in Arbor Court alone, there are currently 7 active listings with only 2 closed listings within the past 6 months.  A couple of these units have been on the market for over a year.

Sellers have to realize that no one can pull buyer clients out of the air.  Our market has slowed down and I don’t think these high end units were “flip worthy” to begin with.  A lot of owners have given up trying to sell these units as new and have taken in renters to cover their expenses.

I also didn’t have time to ask this seller if they were new investors or whether they have been doing this for awhile.  With his reaction to 90 days being a long time, I’m assuming these are not seasoned investors.

I network on a popular real estate forum with agents, buyers and sellers around the world and I am shocked at newer investors who are going into foreclosure and losing money on these so-called investments.  Just like today’s seller, some of these people purchased high end new construction (some above $500,000) and are scrambling on trying to find out the best way to get rid of these properties.  And many of them are trying to sell in subdivisions where the developers are still selling new and offering perks that individual investors just can’t provide.

New investors keep popping up on the forum all the time admitting they have no idea of how to start or what to do but they want to start investing in real estate!  They ask the pros to train them or at least give them a start.  Our answer to these people is to consult with a local REALTOR® that has investment knowledge and sit down with a loan officer to see if they can even afford to begin investing.

If you are the new breed of investor who has made a recent purchase of higher end and/or new construction with the dream of quickly flipping the property and making a profit, I can only wish you the best of luck.  It is difficult enough to sell an existing property at lower price ranges because not only is our area in a buyer’s market instead of the seller’s market we had seen before, we are also going through our normal seasonal slump which occurs every year after the school season begins.  It gets even worse from Thanksgiving to New Year’s.

If you are planning on investing you need to do your homework.  I knew interest rates were going to start increasing.  You don’t have to be a REALTOR® to learn this fact that has been going around for over a year now.  We knew that the industry was going to slow down and the boom we saw over the past 5 years was not going to last forever.  I’m actually surprised it lasted as long as it did.

You need to have the resources to hold onto these properties and make those mortgage payments until the property is sold and closed.  If you cannot do so you will probably need to turn into a landlord until the market improves or until there is less competition (especially in a new construction condo complex or single family subdivision).  Your other choice would be to go into foreclosure or work out a short sale with your mortgage provider so you don’t have to ruin your credit.

Unfortunately, many investors will be learning that investing in real estate isn’t the quick profit center they thought it would be and may never invest again.  Hopefully, they won’t be ruining their credit and losing life savings while learning this important financial lesson.

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