Home Buying in Vernon Hills>Question Details

Kalpar, Home Buyer in Arlington Heights, IL

I am a first time home buyer considering a townhome in vernonhills ,il 4 to 7 years old.

Asked by Kalpar, Arlington Heights, IL Wed Oct 21, 2009

I am planning on staying for the next 5-6 years.How is the resale value of townhomes in my area of interest?

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I don't believe anyone can give you an accurate estimate of townhome appreciation in Vernon Hills over the next 5-6 years. We are in uncharted territory in the housing market. There is no history upon which to base a projection. That said, owning is still preferable to renting even if the value doesn't increase like it has in the past. You need a place to live. You may as well be paying your own mortgage instead of the landlord's. Any improvement you do to your dwelling adds value to you, not your landlord, and eventually, as you get older, you pay off your mortgage and have a place to live with no payments. We will likely see Real Estate get back to appreciating a few percent per year within the next few years but it also keeps pace with inflation, giving an added advantage. In addition, you get the appreciation and inflation on a $150,000 asset (at 3% a year that's $4,500) but you've only invested the downpayment (possibly as lttle as $5,250) That's a VERY good return. That's called "leverage".
2 votes Thank Flag Link Wed Oct 21, 2009
Hi Kalpar,
the answer is still the same as long as you intend to stay for more than 5 years before considering selling.
Talk to you soon.
Edith
0 votes Thank Flag Link Wed Oct 21, 2009
My mention of uncharted territory was not in reference to the Vernon Hills market, it was a comment on the national real estate market we're in today. We've never seen appreciation like we saw in 2000 to 2006 and we've never seen a 20% to 30% drop in values. When you combine that with the stock market drop and record high unemployment and foreclosure rates it's uncharted territory. No one can tell you with certainty how long the downturn will last and what the rate of recovery will be. That said, it is still a great time for smart real estate investment.
0 votes Thank Flag Link Wed Oct 21, 2009
Hi Kalpar, Michael gave you some good insight into why buying as a first time home buyer may be a good idea, instead of renting. Of course you have to look at your financial side, your job security and all the rest...
But if your question is only related to if you intend to stay for 4 - 7 years, then I would say, if you intend to stay longer than 5 years you should experience some appreciation by then, as we hope that the economy and the
real estate market will show improvement by then. How much, truly nobody can really know at this time.....

So you want to make the choice of what you buy, by what in general you absolutely need, then what sells better than something else, look at locations, size of property, upgrades and construction and age, the schools etc.
And do not forget to consider your taxes....

Just a curious question on my part, why did you think/ consider Vernon Hills.... Is it close to work or family or do you have other reasons? And if none of the above reasons, would you consider other suburbs, any others in Lake and also in Cook Counties?

And as a first time home buyer we hope that the tax credit will be extended, or you hurry to close before
the end of Nov. 2009 to take advantage of it.

If I can be of any further assistance just contact me, I would love to e-mail you daily all new townhouses in the suburbs, school districts etc. you care to consider...

Warmest Regards always,
Edith Karoline YourRealtor4Life!
Working always in the very BEST interest of her clients...
Covering parts of the city of Chicago, the entire Northshore, and most if not all N and NW suburbs
Century 21 SGR with offices Southloop & West Loop and Northshore office in Lincolnwood
EdithSellsHomes@gmail.com
0 votes Thank Flag Link Wed Oct 21, 2009
If you're considering buying but worried about resale value 5-6 years down the line you are like most smart buyers today. One of the things I'd ask yourself is this...if values don't go up in 5-6 years and I want to move, would I consider renting it out until prices go up? This way you'll have someone paying your mortgage for you and you can still move. It's also a great way to diversify your investments. The other thing to think about is this...even if prices go down a little, would you still be better of buying than renting. I've never heard of a renter moving out and getting thousands of dollars of their rent back when they move. Even if prices recede a bit in the next 5-6 years (which personally I don't think will happen, but what do I know?) you'll have more options (like turing it into an investment property) and be better off financially than if you rent during that time. Also, be sure to take advantage of the Lake County Home Buyers Assistance Programs which can give you money at very low interest rates (we're talking 0%-4%). If you need more information about these programs feel free to e-mail me at mstodola@ksgmac.com.

Good luck!
Mike
0 votes Thank Flag Link Wed Oct 21, 2009
Kalpar,
Michael gave you a very good answer that covers important aspects of rent vs own. I can add to this as a realtor covering Lake County and specifically Vernon Hills for the last 6 years and also former and current owner of a townhouse and other property in Vernon Hills.
Vernon Hills offers excellent value for the money these days, you can easily afford to buy property that was out of reach for you just a couple of years ago; there are a lot of townhomes that are now being offered below pre-construction prices of 2003-2004! I would really concentrate on newer properties that were built within the last few years - these are more likely to appreciate than the outdated townhomes built in 1980's and 1990's.
In my capacity of a Sr. Loan Officer I could help you with FREE mortgage prequalification so we can determine your comfortable price range and start shopping for your new home.
I can also offer you closing cost credits should you decide to work with our company. We are one-stop shop for all your mortgage and real estate needs!
Don't hesitate to contact me directly with additional questions and to start working on the prequalification.

Best,

Peter Schifrin
Realtor® - Express Real Estate Group, Inc.
Sr. Loan Officer - North Shore Financial Services Corp.
cell 847 630 6843
pschifrin@gmail.com
0 votes Thank Flag Link Wed Oct 21, 2009
Kalpar,

You are wise to consider investing in a property at this time. In my 34 years of actively helping people buy and sell property in the Vernon Hills area I have never seen both a larger selection of homes and interest rates being so low and affordable at the same time. Historically, Vernon Hills has always had good resale value but so much of the answer to your question depends on the price range of the townhome you are considering and the state of the real estate market when you are selling. You will currently find homes for sale at a much lesser price than they were at the height of the market in 2004-2005. For example...I just helped a first time buyer purchase a foreclosed townhome that was over $100,000 less than what the same model had sold for four years ago. You need to have a lot of informaton and knowledge about an area prior to making a comfortable decision. If you are not currently working with an experienced Realtor, please feel free to contact me.

Thank you and good luck.

Al Aronow
RE/MAX Suburban
847-557-8501
alaronowhomes@sbcglobal.net
Web Reference: http://alaronowhomes.com
0 votes Thank Flag Link Wed Oct 21, 2009
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