Tuesday, April 30, 2013

Chicago west town mixed use for sale. 7950 sf of(fully leased) possibilities


Zoned M3 (multiple uses), this West Town mixed use property is in a fantastic location. The property has 2, 2500 sf timber lofts w/soaring 20 ft ceilings & compl renovated, sky lights, W/D, lg closets & pkg. The double commercial
 space has a florist now, but open to a myriad of ideas. Carpe Diem. 7950 sf of options, priced right! Email rgoldstein@rubloff.com for more info. Or 3122645846
Taxes: $9,678

MLS #: 08324937
Status: Active
Type: Commercial
County: Cook

Room Dimensions

Property Features

List Date: 2013-04-24 
Property Model/Style: 
Property Features: 
Beds: 0
Full Baths: 0
Half Baths: 0
Association Fee: $ 0
Taxes: $9,678
Year Built: 
Lot Size: 
Waterfront Property: no
Parking: Yes 

School Information

Grade School: 
Grade School District: 
Middle School: 
Middle School District: 
High School: 
High School District: 
Other School District: 

Jobs&homes guru. Base of our economy

Tax advantages of being a landlord..

The tax advantages of being a landlord


Are you sure you want to be a landlord? I have clients who love to regale me with stories about their fun experiences with tenants. Like the one who took almost every fixture when he moved out: carpeting, curtain rods, towel bars, you name it — even a toilet, believe it or not.
Indeed, putting up with tenants can be a real pain. But that negative consideration is offset by improving real estate markets in many areas and favorable tax rules that aren't available for other types of investments. In fact, favorable tax rules are a big reason why so many fortunes are made in real estate. The other big reason is that leveraging real-estate investments with mortgage debt can greatly multiply the upside potential.
But let’s stick to taxes here. This article is the first of several on the most important tax issues that landlords need to understand.
What you can write off
I’m sure you already know you can deduct mortgage interest and real estate taxes on rental properties. However, if you pay mortgage points, you must amortize them over the term of the loan (unlike points on a mortgage to purchase a principal residence, which you can deduct immediately).

You can also write off all the other standard operating expenses that go along with owning a rental property: utilities, insurance, repairs and maintenance, yard care, association fees, and so forth.
The real kicker is that you can depreciate the cost of residential buildings over 27.5 years, even while they are (you hope) increasing in value. Say your rental property—not including the land—cost $200,000. The annual depreciation deduction is $7,273, which means you can have that much in positive cash flow without owing any income taxes. That is a nice benefit, especially if you own several properties. Commercial buildings must be depreciated over a much-longer 39-year period, but the depreciation write-offs will still shelter some of your cash flow from taxes. 

Beware of the dreaded passive loss rules
If your rental property throws off a tax loss—and most do, at least during the early years—things get complicated. The so-called passive activity loss (PAL) rules will usually apply. In general the PAL rules only allow you to deduct passive losses to the extent you have passive income from other sources—like positive operating income from other rental properties or gains from selling them. Passive losses in excess of passive income are suspended until you either have more passive income or you sell the property or properties that produced the losses. Bottom line: the PAL rules can postpone rental property loss deductions, sometimes for many years. Fortunately, there are several exceptions that can allow you to deduct losses sooner rather than later. I’ll cover those exceptions in a future article. 

What if I have income?
Eventually your rental properties should start throwing off positive taxable income instead of losses, because escalating rents will surpass your deductible expenses. Of course, you must pay income taxes on those profits. But if you piled up suspended passive losses in earlier years, you now get to use them to offset your passive profits.
Another nice thing: positive taxable income from rental real estate isn't hit with the dreaded self-employment (SE) tax, which applies to most other unincorporated profit-making ventures. The SE tax rate can be up to 15.3%, so it is a wonderful thing when you don’t have to pay it.
One bad thing: thanks to a provision in the 2010 health care legislation, positive passive income from rental real estate can get socked with the new 3.8% Medicare surtax on net investment income. However, this new tax only hits upper-income folks. Consult your tax adviser for the full story.
Taxpayer-friendly rules when you sell
When you sell a property you’ve owned for more than one year, the profit (the difference between the net sales proceeds and the tax basis of the property after subtracting depreciation deductions) is generally treated as a long-term capital gain. As such, it will be taxed at a federal rate of no more than 20% (or 23.8% if you owe the 3.8% Medicare surtax). However, part of the gain—an amount equal to the cumulative depreciation deductions claimed for the property—is subject to a 25% maximum federal rate (28.8% if you owe the 3.8% Medicare surtax). The rest of your gain will be taxed at a maximum federal rate of no more than 20% (or 23.8%). Don’t forget that you may also owe state income tax on real estate gains (and NYC tax for properties in the Big Apple).
On the other hand, it is important to remember that rental property appreciation isn't taxed until you actually sell. Good properties can generate the kind of compound tax-deferred growth that investors dream about. You can even pocket part of your appreciation in advance by taking out a second mortgage against your property or refinancing it with a bigger first mortgage. Such cash-out deals are tax-free.
You also have the option of selling appreciated real estate on the installment plan by taking back a note for part of the sale price. Then your taxable gain can be spread over several years. You can charge the buyer interest on the deferred payments, but you generally don’t have to pay interest to the government on your deferred gain.
Remember those suspended passive losses we talked about earlier? You can use them to shelter gains from selling appreciated properties.
Finally, the tax law allows real estate owners to unload appreciated properties while deferring the federal income hit indefinitely. Here we are talking about so-called “like-kind exchanges” which are also known as “Section 1031 exchanges” (named after the applicable Internal Revenue Code section). With a like-kind exchange, you swap the property you want to unload for another property (the so-called replacement property). You’re allowed to put off paying taxes until you sell the replacement property. Or when you’re ready to unload the replacement property, you can arrange yet another like-kind exchange and continue deferring taxes. While you cannot cash in your real-estate investments by making like-kind exchanges, you can trade holdings in one area for properties in more-promising locations. In fact, the like-kind exchange rules give you tons of flexibility when selecting replacement properties. For example, you could swap several single-family rental houses for an apartment building, a shopping center, raw land, or even a golf course or marina.
The Bottom Line
As I said at the beginning, the tax rules for landlords are pretty favorable, all things considered. I have a couple more articles in mind for all you landlords and landlord wannabes out there, so please stay tuned.
By Bill Bischoff 

Saturday, April 27, 2013

How low can we go? Chicago inventory levels by neighborhood

We all know that inventory levels are low but just how low?  Here are the numbers for some key neighborhoods in Chicago 

For detached properties over the last two year period:

8004 (Lincoln Square) started two years ago with a 7.1 months supply of inventory, went as high as 18.7 months and now is at 1.6 months.
8005 (North Center) started two years ago with a 5.9 months supply of inventory, went as high as 9.8 months and now is at 1.4 months.
8006 (Lake View) started two years ago with a 8.4 months supply of inventory, went as high as 12.7 months and now is at 2.1 months.
8007 (Lincoln Park) started two years ago with a 10.7 months supply of inventory, went as high as 21.2 months and now is at 3.3 months.
8008 (Near North Side) started two years ago with a 15 months supply of inventory, went as high as 42 months and now is at 10.7 months.
8016 (Irving Park) started two years ago with a 10.1 months supply of inventory, went as high as 13.1 months and now is at 1.5 months.
8022 (Logan Square) started two years ago with a 6.8 months supply of inventory, went as high as 18.4 months and now is at 1.7 months.
8024 (West Town) started two years ago with a 7.9 months supply of inventory, went as high as 14.2 months and now is at 1.7 months.

For attached properties over the last two year period:

8004 (Lincoln Square) started two years ago with a 7.2 months supply of inventory, went as high as 13.9 months and now is at 2.1 months.
8005 (North Center) started two years ago with a 6.4 months supply of inventory, went as high as 26.3 months and now is at 1.4 months.
8006 (Lake View) started two years ago with a 9.6 months supply of inventory, went as high as 13.1 months and now is at 1.8 months.
8007 (Lincoln Park) started two years ago with a 9.3 months supply of inventory, went as high as 13.7 months and now is at 1.7 months.
8008 (Near North Side) started two years ago with a 11.1 months supply of inventory, went as high as 12.9 months and now is at 2.4 months.
8016 (Irving Park) started two years ago with a 20.9 months supply of inventory, went as high as 24.4 months and now is at 3.2 months.
8022 (Logan Square) started two years ago with a 11 months supply of inventory, went as high as 23.1 months and now is at 1.3 months.
8024 (West Town) started two years ago with a 10.1 months supply of inventory, went as high as 13.5 months and now is at 1.3 months.

Wednesday, April 24, 2013

New to mkt! Great live/work investment in West Town. Carpe Diem.7950 sf of possibilities!

 2007-2009 W. Grand Ave. Chicago, IL.
 Zoned M3(multiple uses), this West Town mixed use property is in a fantastic Location. The property has 2, 2500 SF timber lofts w/soaring 20 ft. ceilings and compl. renovated, skylights,w/d,lg closets and pkg.
The double commercial space has a florist now, but open to a myriad of ideas...Carpe Diem..7950 SF of options! Email rgoldstein@rubloff.com for income/expense info. or call 312-264-5846. Priced right@$1,208,705

2626 N. Spaulding. Logan Square Light-filled home

 Enjoy spring picnics in your courtyard & then retreat to this light-filled, spacious Logan Square corner unit. Condo features: Hardwood flrs throughout,firepl,Lg. Lr/sunroom,in-unit W/D & a Sep. dining area. Incl:
lg. storage area.Take advantage of this Amazing location:Best new restaurants/bars/shops, all public transportation.
Great permit pkg is plentiful. Priced smartly@$249,700
email rgoldstein@rubloff.com for more info or 3122645846 for showing

Monday, April 1, 2013

Improving your appraisal. Some thought leadership!


  - When Kellie and Michael May decided to refinance their home in the New York suburbs, they wanted to take advantage of historically low interest rates. But before landing a new 30-year fixed-rate mortgage, they had to get through a home appraisal.

"It was a major stumbling block," says Kellie May, who has owned the 4-bedroom, 3-bath colonial for seven years. Not that she and her husband were unprepared; they'd been through an appraisal for another refinance in 2010, so they knew to point out improvements they'd made to the 3,400 square foot home, and supply prices for other neighborhood properties that had sold recently.

But the appraisal came back roughly $70,000 less than the $1,230,000 the Mays were expecting, and too low to support their new loan.

They responded with a paperwork arsenal aimed at their lender, asserting that the appraisal had been based on faulty recent sales data. The loan squeaked through, after the bank crafted an exception for the Mays. It was able to do that because their loan was a jumbo loan, not subject to the more rigid underwriting standards they would have encountered if it were a conventional loan aimed at secondary buyers like Fannie Mae and Freddie Mac.

Low appraisals are becoming a bigger problem for many would-be buyers and refinancers as home values have started to stabilize and rise in some markets.

In Leesburg, Florida, for example, low appraisals have caused the cancellation of as many as 15 percent of home sales for local real estate broker Gus Grizzard.

"We are seeing higher price appreciation and are starting to run into appraisal problems," said Charlie Young, chief executive officer of ERA Franchise Systems, a firm with a national network of real estate brokerage offices, including Grizzard's. The National Association of Realtors reported that inventories of homes were low and the median price a home resale was, at $180,800 in December, up 11.5 percent in a year.

Appraisals are based on recent sales prices of comparable properties. And in rising price markets, those sales prices might not be high enough to support the newest deals. Young said there were many places in California reporting appraisal problems.

The federal government recently issued new rules aimed at improving the appraisal process as it pertains to high-interest mortgages on rapidly appreciating homes.

But those rules don't go into effect for almost a year, and don't apply to most conventional loans. It pays to protect your own loan before the bank even thinks about sending that guy with the clipboard over to your house.

"The reality is that the appraiser is only there for 30 minutes at most," says Brian Coester, chief executive of CoesterVMS, a nationwide appraisal management company based in Rockville, Maryland. "The best thing a homeowner can do to get the highest appraisal possible is make sure they have all the important features of the home readily available for the appraiser."

Here are eight ways you can bolster your appraisal:

Is the appraiser from within a 10-mile radius of your property? "This is one of the first questions you should ask the appraiser," says Ben Salem, a real estate agent with Rodeo Realty in Beverly Hills, California.

He recalled a recent case where an appraiser visited an unfamiliar property in nearby Orange County and produced an appraisal that Salem said was $150,000 off. "If the appraiser doesn't know the area intimately, chances are the appraisal will not come back close to what a property is really worth."

You can request that your lender send a local appraiser; if that still doesn't happen, supply as much information as you can about the quality of your neighborhood.

Provide your appraiser with at least three solid and well-priced comparable properties. You will save her some work, and insure that she is getting price information from homes that really are similar to yours.

Websites including Realtor.com, Zillow and Trulia offer recent sales prices and details such as the number of bedrooms and bathrooms in a home.

If you're going to do minor renovations, start with your kitchen and bathrooms, says G. Stacy Sirmans, a professor of real estate at Florida State University. He reviewed 150 variables that affect home values for a study sponsored by the National Association of Realtors. Wood floors, landscaping and an enclosed garage can also drive up appraisals.

If you've put money into the house, prove it, says Salem.

"Before-and-after photos, along with a well-defined spreadsheet of what was spent on each renovation, should persuade an appraiser to turn in a number that far exceeds what he or she first called out."

Don't forget to highlight all-important structural improvements to electrical systems, heating and cooling systems - which are harder to see, but can dramatically boost an appraisal. Show receipts.

If your town has recently seen exciting developments, such as upscale restaurants, museums, parks or other amenities, make sure your appraiser knows about them, says Craig Silverman, principal and chief appraiser at Silverman & Co. in Newtown, Pennsylvania.

Many homeowners covet that refinished basement, but that doesn't mean appraisers look at it the same way. "Improvements and additions made below grade, such as a finished basement, do not add to the overall square footage of your house," says John Walsh, president of Total Mortgage Services in New York. "So they don't add anywhere near as much value as improvements made above grade."

According to Remodeling magazine, a basement renovation that cost $63,000 in 2011-12 will recoup roughly 66 percent of that in added home value. That's not as good as an attic bedroom, which will recoup 73 percent of its cost. Even similar bedrooms typically count for more if they are upstairs instead of downstairs.

Even jaded appraisers can be swayed by a good looking yard. "Tree trimming, cleaning up, a few flowers in the flower beds and paint touch up can all help the appraisal," says Agnes Huff, a real estate investor based in Los Angeles.

That advice holds true indoors, too. "Get rid of all the clutter in your home," says Jonathan Miller, a longtime appraiser in New York. "It makes the home appear larger."

Don't follow the appraiser around like a puppy. "I can't tell you how many homeowners or listing agents follow me around in my personal space during the inspection," he says. "It's a major red flag there is a problem with the home."

And while you're at it, make the appraiser's job as pleasant as possible by giving your home a pleasant smell. At a minimum, clean out the litter box. Baking some fresh cookies and offering him one or two probably won't sway your appraisal, nor should it. But it couldn't hurt.

Original Source: Reuters