Kelsey Shaw Chicago

Quick Tip: A hedge against inflation

From the grocery store to your energy bills, inflation has become a reality of everyday life. And while June’s inflation reading of 9.1% – a 40-year high – has caused many people to reexamine their budgets, hard assets like real estate are still very much in favor because they offer protection against rising prices. Here are a few reasons why real estate can serve as a hedge against inflation: 

Fixed Expenditure – With a fixed-rate mortgage, the monthly payment (principal and interest) for your home will remain the same, whereas rental costs will rise. On top of that, mortgages become “more affordable” over time as wages increase and the value of the dollar decreases.

Home Price Appreciation – In most cases a tangible asset like real estate gets more valuable over time, increasing your equity as your monthly payment stays the same.

Housing Demand – Regardless of economic conditions, there will aways be a demand for real estate, because housing, whether owned or rented, is an essential need. However, beyond shelter and investment diversification, owning a home provides a sense of enjoyment too – a return that goes beyond the financial.There are aspects of inflation that are unavoidable, from increased prices on consumer goods to a fluctuating stock market, but real estate is one of the most reliable ways to fight inflation not just this year but any year.

For more buying and selling tips, or a market analysis of your home and local area, feel free to reach out anytime.

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Outperforming the Market

One of the biggest trends to emerge from the COVID-19 pandemic is the focus on housing & what people need from their home. Gone are the days where home was just a place you laid your head, now it is your workplace, your school, your gym, & more. As people seek more space and look to take advantage of low interest rates, the local real estate market has seen a strong recovery.

In fact, the number of homes that have gone under contract in the Chicagoland area since COVID-19 hit in the middle of March is up 8.6% compared to the mid-March through mid-September period last year. Meanwhile, @properties is outperforming the market, with new contracts up 20.3% during this timeframe.

New listings are another important performance metric. And while they are down market-wide since the start of the pandemic, @properties’ new listings are up over 5% year over year which is showing strong recovery.

As the region’s largest and most dynamic marketplace for homebuyers and sellers, @properties puts you in the best position to achieve your real estate goals. With our best-in-class marketing, leader status, & fully integrated programs; @properties is an industry leader year after year & the best brokerage to work with whether selling or purchasing your home.

If you are thinking of making a move in 2021 – Let me partner with you & guide you home.

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A portion of this post originally appeared on @home, an @properties blog.

Moving Day MUST HAVES!

Now that you know my top 14 tips to make moving day a breeze.. you are ready to go shopping & prepare for the big move! If you are like me.. you have mixed emotions about moving day. I will say I do always love getting the chance to audit my stuff, organize it all, & get creative in styling my new home. However the stress of the move, the physical labor of it all, & the looming hours of unpacking ahead can be daunting… but it doesn’t need to be.

Moving Day MUST HAVES!

As a REALTOR who has helped 100’s of clients move & as someone who has moved 4 times in the last 6 years (the curse of being a real estate broker & finding the coolest homes is you want to move into them all..) I consider myself a moving expert. Whether it’s a rental, you’ve purchased your first home, or your 10th home; you will absolutely need everything below & will thank yourself later for having it organized & ready to go! As we know, I prioritize convenience so below are directs links to amazon for all of my moving day must haves – ‘add to cart’ & get it delivered right to your doorstep, couldn’t be easier!

Cleaning Supplies: I cannot stress this enough, clean your house from top to bottom BEFORE moving in. While we hope the previous owners or landlords would have the courtesy to leave the home clean, that isn’t always the case. Be prepared to make your new space sparkle & start out this next chapter on the right page. The below products are absolutely necessary with the most important products first. Do not move into your new home without these!!

  • Multi-purpose cleaning spray and bleach wipes to sanitize & disinfect all surfaces. Tip: First thing to do when you arrive is clean the inside of the fridge/freezer with bleach but be sure to unplug the refrigerator & freezer prior to cleaning, prop the doors open to air out
  • Handheld vacuum for baseboards, vents, cupboards, etc. Tip: Clean literally from Top to Bottom in every room to catch all of the dust, dirt, etc. Finish with the floors once you are all moved in!
  • Washing Machine cleaner – TIP: ALWAYS clean your washing machine before doing your first load of laundry
  • Dishwasher detergent
  • Dishwasher cleaner
  • Toilet brush & cleaner
  • Mr. Clean Magic Eraser
  • Bi-Fold Paper towels
  • Washable dust cloths – Wipe it allll down
  • 60 gallon trash bags for each room to help keep it tidy when unpacking
  • Bar Keepers Friend – If you don’t already have this, you need it. Not moving specific, but it’s truly amazing. Check out this article in Taste of Home to see all of the ways to use it.

Moving Supplies: Most of these items you will want before you move! I would suggest getting boxes from home depot but definitely place an order for the below items about 2 weeks before moving day!

  • Dolly/hand truck to move boxes from one room to the other
  • Mattress Bags
  • Wardrobe boxes – Uhaul has the best ones
  • Boxes of all sizes. Tip: Specifically Banker’s Boxes for small/fragile items, office files, books, etc. because they are so easy to carry, easy to break down, but great for long term storage as well
  • More packing tape than you’ll think you’ll ever need
  • Color coded labels
  • Heavy duty storage bags
  • Foam sheets/pouches + packing paper
  • Utility knife
  • Stretch Wrap for furniture
  • Tool set for taking apart & reassembling

First Day & Night Bag: YOU DID IT, YOU ARE READY FOR MOVING DAY!! or are you.. The last thing you want to do now is search for your pillow case, tooth brush, & pajamas. Make sure you pack an ‘overnight’ or weekend bag with all of your necessities so you aren’t scrambling to find what you need.

  • Anything you’d take for a weekend getaway including pajamas + additional clothes, toiletries, etc.
  • Snacks
  • Reusable water bottle
  • Phone chargers
  • First aid kit + prescriptions
  • Paper plates, cups, flatware for easy dining & clean up
  • Bath towels + shower curtain if applicable
  • Diffuser & essential oils because some aromatherapy is needed after this stressful day #calm #chill #restore

There ya have it! You are ready to rock this move. If you haven’t already, check out my post on my top 14 tips for moving day.

Chicago, IL

What You Need to Know About Tax Proration

Now that we know all the steps of a home purchase & have the terms down, let’s talk about taxes. While taxes may be the last thing on your mind as you advance through the home buying process. Yet, there are important tax considerations that need to be worked out before you get to the closing table. This post will tell you what you need to know about tax proration.

Property tax proration is a way to split property taxes fairly to ensure that each side is paying for the specific time that they were owners of the property. Since Illinois property taxes are paid in arrears, tax proration ensures that the buyer is fairly compensated for the tax bills they will receive after the closing, for the period in time in which the seller still owned the property.

Your real estate broker can help you better understand what tax proration is, how it works, and how it is calculated. Once you have a home under contract, your real estate attorney will work with the seller’s attorney to determine the exact amount due to you during the attorney review process.

The Calculation

Below are six facts about the tax proration process. When you reach this stage, your real estate attorney will guide you along with the help of your real estate broker.

The Facts

  1. Sellers will take responsibility for the property taxes up until the day the property is officially closed. The buyer takes on the property taxes from the day the purchase is final.
  2. Tax proration may be a large dollar amount on the closing statement, because it is prorated to the day of close.
  3. The real estate attorney and/or broker can check the county assessor’s website to determine any exemptions or freezes and anticipate changes to the tax bill. Also, always be sure to file for your homeowners exemption after closing!
  4. With new construction or rehab properties, there is special attention that needs to be paid to the real estate tax credits and prorations. This is because the property upon which the listed taxes are based is no longer the same property that is now being assessed as rehabbed or new.
  5. Unlike paying your rent or mortgage on the 1st of every month, 2019 property taxes are paid in 2020 so therefore taxes are prorated at a slightly higher amount because taxes will likely go up.
  6. An escrow account is used in cases where the parties are not certain of the anticipated change in the real estate taxes and cannot agree to a final credit until the bills come out. The seller sets money aside in the escrow account and those funds are issued once the tax bill arrives.

Whether you’re a buyer or seller, it’s important to understand tax proration so that when you arrive on closing day, you’ll feel fully informed and prepared. Be sure to consult your real estate broker as early as possible in the homebuying process so you are comfortable with all of the steps to come!

Chicago, IL

What Do Rising Property Taxes Mean For You?

Chicago property taxes

In Chicago, specifically referencing Cook County, property taxes rose in 2018 & everyone is left wondering – What now?

This year, 2018, was a reassessment year for all of Chicago, so homeowners & hopeful homeowners will receive increases – for example, I had clients who’s taxes went up a shocking 83%.

So, as a Seller, should you lower your asking price because of rising taxes? As a Buyer, should you low ball the Seller & justify your offer price due to the anticipated tax increase?

My opinion to both of those questions is: No.

This past Spring & Summer we were in a Seller’s market, so the chances of Seller’s having the hindsight to adjust their asking price to outweigh the impending tax burden were slim to none. While the market is starting to stabilize into the Fall, I still advice my Buyers against submitting offers asking for a significant tax proration, due to the lack of inventory the ball was still in the Seller’s court so we need to be reasonable, but definitely take the impending tax hike into account.*

While this tax bill hit everyone with some ‘sticker shock’, we need to recognize that the previous reassessment figures sent out in the 2015 Triennial were based on 2012-2013-2014. 2012-2013 was coming off the worst real estate crash since the Great Depression, so those previous assessed values were low – because the market was artificially low.

My best advice is ALWAYS do your due diligence, talk with your Broker & Attorney on the anticipated increase & be sure to understand how it will affect your bottom line. Be aware of exemptions that may alleviate the tax burden & be explicit with your questions so you are fully aware of what you are committing to with the sale or purchase of your home. Communication is key.

The good news, if you did purchase or are currently an owner in Cook county, you can appeal & most homeowners appealing to the Assessor’s Office do not use an attorney. 51% of residential appeals to the Assessor’s Office are successful; the amount of reduction varies, however. If you are looking for more guidance I do know a great tax appeal attorney – so reach out to me to discuss your options.

If you’re appealing your property taxes: 

  • Someone appealing does NOT have to (do) the work. The assessor’s office will look up comparable properties for them. If someone wants to submit their own list of comparables, that is, of course, fine. We just make it clear that appellants don’t have to worry about how “long” it’ll take to file an appeal. It is a one-sided form which takes approximately five minutes.
  • Appeals are for the purpose of reducing the Assessor’s valuation of a property. They do not automatically reduce a future tax bill. Dollar amounts of tax bills are decided by the tax rates and levies in individual communities (school districts, etc.). Most property tax revenue goes to public schools.
  • If someone “loses” an appeal and does not receive a reduction, their assessed value will NOT go up. It stays the same for the three years between triennials (unless they appeal the following year and win).
  • If you are successful in one of your appeals, the reduction will be reflected on the second-installment tax bills to be mailed in the summer of 2019.

Helpful links:

Click Here to Appeal Online

Illinois Property Tax Calculator

For more information on this, check out this article.

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