Looking ahead to 2012, there does not appear to be an end in sight to the historic downturn in housing, especially in Chicago, Illinois, which is bad news for sellers and very good news for buyers. RealtyTrac reported that 1 in 427 housing units received a foreclosure notice in Illinois and "foreclosure activity is actually increasing, not decreasing since the Robo-signing debacle started wrapping up in November 2011 and lenders have resumed foreclosures," says Bardan Azari, of Cherry Picker Investments, a foreclosure investment service. Furthermore, a recent report from Zillow indicated that 46% of Chicago real estate owners had negative equity; hence, they are underwater on their mortgage.
In summary, the 2012 spring market is likely going to be a hostile environment for sellers as 2012 is forecasted to end 5-10% below where it starts and short sales are projected to increase 25%. As I noted in the magazine publication, Today's Chicago Woman, "All of this trauma for sellers translates into great buying opportunities for prospective purchasers and investors as cash will continue to be king in 2012 and interest rates will stay at record lows as the pace of sales increases."
Michael Hobbs, PahRoo Appraisal & Consultancy