Keeping up with Chicago's North Shore Real Estate Market!

Contact Ann

call or text me: 847-691-1111 or email: ann@rannjones.realtor

Saturday, January 29, 2011

Full Disclosure

We spend weeks or even years looking for our new home.  We finally find what we want.  All we think about is where am I going to put that sofa or what color am I going to paint that wall or which mover am I going to hire.  The last thing we want to hear is what issues our home inspector points out... after all, we're in love with the new house.   I know I wasn't interested in hearing what was wrong, when I bought my homes. 

But bear in mind... every home has a history -- even new construction.  The inspector can't pull back the walls to see what is behind them or get inside the pipes or completely see the electrical wiring.  So sometimes,  we find out something unexpected when we buy a home -- sometimes the news is un-welcomed.  Recently I got an inquiry from one of my clients asking about some issues that they were having with the property they had just purchased.  With some frustration, their question was,

"Didn't the sellers have to disclose that information?"

It's a complicated question and the answer may not be the one you want to hear.   Because the answer is, "Well, not necessarily...."

What does Illinois law require the sellers to disclose?  There are a number of disclosure forms that sellers must complete and become part of the legal contract when they are selling their home.  Sometimes local municipalities/counties require additional disclosures.  These are the three Illinois required forms:

1. Illinois Disclosure -- Sellers are required to complete the Residential Real Property Disclosure Report and disclose any known defects with the properties.  This includes items like the foundation, water, roof, furnace and other parts of the house.  The seller needs to reply "yes", "no" or "N/A" to questions that are written as statements.  For example,

"I am aware of unsafe conditions in the drinking water."

If yes is the answer to any question, then an explanation needs to be provided and explained.   This form needs to be presented to the buyers.   Buyers really should review this form before they make an offer on a home.  

With that said, only sellers, who have occupied the property within the last year, are required to disclose anything.  So if the sellers inherit the property or have used it as an investment property, they are not required to disclose anything.  For more specifics, refer to the Residential Real Property Disclosure Act.

If you read the fine print, the seller is not liable for errors, inaccuracies or omissions of information for things of which they have no knowledge.  For example,  maybe there are a few shingles missing on the roof.  The seller may not know that, so they didn't disclose it.  The seller is required to disclose material defects where they have actual knowledge of the problem.

Further, if there has been a problem in the past, but the sellers have remedied the issue, then they don't need to disclose it either.    So for example, they have had water in the basement.  The sellers installed a sump pump or put in new draining tiles;  in their minds, they have corrected the problem, so it does not need to be disclosed. 

Therein lies the conundrum.  When the new owners confront issues or problems with the house, there is tremendous frustration -- why wasn't this disclosed?  It's very hard to prove that the sellers willfully misled the buyers. 
 
2. Radon Disclosure.  Effective January 1, 2008 (updated August 2009) the Illinois Radon Awareness Act requires the seller of a residential property (of one to four dwelling units) to provide the buyer with two documents before becoming bound on a contract: 1) a "Disclosure of Information on Radon Hazards" and 2) a pamphlet on radon testing guidelines from the Illinois Emergency Managment Agency. The aim of the legislation is to boost awareness about radon; nothing in the Act requires a seller to test for radon or to engage in “mitigation activities.”
 
3. Lead Paint Disclosure
Sellers are required to disclose information regarding lead paint for homes older than 1978.  It's estimated that about 75% of the Illinois homes built before 1978 contain some lead paint.  Most sellers have no idea whether there is lead paint in their homes and disclose that accordingly.  For newer construction, the form is a bit irrelevant. 


In April a new regulation was enacted in Illinois regarding lead paint.  Basically, with a home built before 1978,  there are increased regulations involved in renovating the house.  These changes have been based on a new Federal law.  Contractors are required to be certified by the state.  If you are planning to renovate an older home, you might want to take a look at the brochure, Renovate Right, provided by the EPA. 


Sellers need to disclose known problems.... but sometimes they really are unaware of problems within their homes.  So when a problem occurs, the buyers may not get the relief they are looking for -- they have to prove that the sellers were deceiving them, which can be pretty challenging. 

Have an inspection.. when questionable items appear on the disclosure form -- investigate further.   Any answers you receive from the sellers should be documented by your attorney.  Trust that they are being honest with you.  If you have doubts then figure out whether you really want to move forward and act accordingly.   

But, keep in mind -- every home has its issues -- there is no such thing as a perfect home.  Expecting one is unrealistic. 

Saturday, January 22, 2011

Checklist for home owners

One of the things that always amazes me when I look at new homes on the market is how many times sellers miss the mark with basic home maintenance.  I'm not one to judge and I know how hard it is to stay on top of all the things that need to be done with a house.  In this market where every house is being judged by potential buyers, a house that is well maintained may win over one that clearly seems to need some repairs.  Sometimes it seems like people take better care of their cars than they do their houses.  The American Homeowner website released a list of maintenance activities that I thought was worth sharing.  Some of these items like cleaning the gutters we all do - but I thought there were a few things on the list worth considering. 

Another thing that I like doing with my own house, is having a home inspector come in a do a "check-up" every five years.  I know a lot of people think that that is a waste of money, but the way I look at it is: we have our cars in for a service check periodically...we check in with our doctors to make sure our health is OK -- why not check our houses?  I had someone come in and inspect my house a few years ago and it was great.   He gave me "punch list" of little things to address.   While there are many capable inspectors, I suggest inspectors who are affiliated with the American Society of Home Inspectors (ASHI).

You never know if it's the squeaky doors or the leaky faucets that might have turned a buyer off on a home.  A well maintained home is a loved home -- and we all want a home that we can love!

Sunday, January 2, 2011

Moving on Up? 2010 End of Year Recap of Luxury Homes on the North Shore

My June 8th blog entry outlined the high-end homes on the North Shore.  As we enter the new year,  I thought I would give you a 2010 recap of the luxury home market along the shore.

Highest sale in 2010
New Construction -- the highest selling new construction home was 523 Hoyt Lane in Winnetka.  It sold in March for $6,621,300.
Older Home -- a number of lovely older homes sold this year, but the highest selling was the 1857,  2.5 acre lakefront home at 1175 Whitebridge Hill Road in Winnetka.  It sold for $6,500,000 in September.

Current Inventory
Evanston
2 over $3M
1 over $4M
$7,900,000 is the price of the highest priced home
0 sales over $3M in 2010
Highest sold property in 2010 -  6 Milburn Park -  closed for $2,400,000
? years of inventory of houses over $3M -- no sales in the last year, so can't compute the number

Wilmette
4 over $3M
1 over $4M
$4,825,000 is the price of the highest priced home
4 sales over $3M in 2010
Highest sold property in 2010 -  3 Canterbury -  closed for $4,750,000
About 1 year of inventory

Kenilworth
4 over $3M (with 1 Pending Sale)
2 over $4M
$6,500,000 is the price of the highest priced home
3 over $3M (with 1 Pending Sale)
Highest sold property in 2010 -  528 Roslyn -  closed for $3,225,000
About 1 year of inventory

Winnetka
22 over $3M
10 over $4M
$23,000,000 is the price of the highest priced home
12 sales over $3M in 2010 (1 Pending Sale) - 4 over $4M (2 Pending Sales)
Highest sold property in 2010 -  523 Hoyt -  closed for $6,621,300
About 1.5 years of inventory of houses over $3M

Glencoe
15 over $3M
8 over $4M
$7,785,000 is the price of the highest priced home (currently under contract)
$7,500,000 is the highest price house currently on the market
3 sales over $3M in 2010 - 1 sale pending over $4M
Highest sold property in 2010 -  600 Sheridan Road -  closed for $3,485,000
5 years of inventory of houses over $3M

Northfield
3 over $3M
2 over $4M
$5,999,000 is the price of the highest priced home
1 sales over $3M in 2010
Highest sold property in 2010 -  25 Meadowview Drive -  closed for $3,346,500
3 years of inventory of houses over $3M

Highland Park
14 over $3M
11 over $4M
$9,900,000 is the price of the highest priced home
2 sales over $3M in 2010 - 0 over $4M
Highest sold property in 2010 -  65 S. Deere Park Drive -  closed for $3,205,000
7 years of inventory of houses over $3M

Lake Forest
42 over $3M
28 over $4M
$12,000,000 is the price of the highest priced home currently on the market
5 sales over $3M in 2010 3 sales over $4M  (1 pending sale)
Highest sold property in 2010 -  620 Lake Road - closed for $5,200,000
about 7 years of inventory of houses over $3M

Lake Bluff
4 over $3M
4 over $4M
$18,977,000 is the price of the highest priced home currently on the market
0 sales over $3M in 2010
Highest sold property in 2010 -  112 Oak Terrace - closed for $1,835,000 (This represented the only sale in Lake Bluff that was over $1.5M.)
? years of inventory of houses over $3M -- no sales in the last year, so can't compute the number

Things haven't change since last summer -- except the price ....
The most expensive new construction house currently available is the $23 million, 27,000 square foot home in Winnetka designed by architect Richard Landy, called Le Grand Rêve. It is situated on Locust Road, in the Avoca/New Trier School districts.

The most expensive “grand estate” is Lake Bluff’s Magnificent 1911 Benjamin Marshall designed home, Landsdowne, sited along the shore of Lake Michigan with over 14,500 square feet of living space, 21.2 acres of land and is in the Lake Bluff/Lake Forest school districts. It is priced at $18,997,000.

Wilmette and Kenilworth are pretty much keeping pace with their high end inventory.   Winnetka is doing fairly well also.  The other communities have significant levels of high end homes.

If you're thinking about Moving on Up to a bigger home -- it's a great time to go shopping!