Feb 18, 2009
Housing Bulletin
Housing Bulletin: It Takes a Village
When checking out the highest-priced home sales in the Chicago area, the two suburbs where I most often wind up are Lake Forest and Winnetka. While other towns (Hinsdale, Kenilworth, Glencoe) have lots of high-end sales, these two towns are perennially near the top of Chicago’s rankings for the number of sales at a million dollars or more (usually behind Chicago’s Gold Coast and Lincoln Park neighborhoods).
The two towns are roughly comparable: they have long histories of affluence, great schools, gorgeous housing both old and new, and superb beaches. But they seem to be responding differently to the steep downslide in the real-estate market. The village of Winnetka, which is considerably smaller than the city of Lake Forest, has seen more homes sell than its northern counterpart. According to Midwest Real Estate Data, Winnetka, with 38 percent fewer households than Lake Forest, had 40 percent more sales of $1 million–plus homes from November 2008 through January 2009. The numbers are small—ten sales in Lake Forest and 14 in Winnetka—but nevertheless completely out of proportion to the towns’ sizes
“Sellers have brought their prices way down in Winnetka; we’ve all concluded that sellers in Lake Forest have not adjusted like those in Winnetka have,” says Adele Bensinger Curtis, a Prudential Preferred Properties Agent in Lake Forest who also has covered Winnetka extensively in her 26 years selling North Shore real estate. “They’re not compensating for the fact that they are in a dismal market. In Winnetka, Wilmette, the southern part of the North Shore—they’ve gotten it. They understand we’re not in 2005 anymore.”
Curtis’s own research shows that, as of early February, the number of homes listed for sale in the two towns was proportional to their populations: Winnetka has a little more than 60 percent of Lake Forest’s population and its number of listed homes. Despite that, over the past six months Winnetka has had 20 percent more home sales than Lake Forest (those are sales at all price levels, not just the $1 million–plus range).
Curtis speculates that, because Winnetka is closer to Chicago, its residents might have a better grasp of the problems plaguing the larger real-estate market—and so they are willing to drop their prices if that’s what it takes to sell their homes. But she also says that the imbalance between Winnetka and Lake Forest looks likely to change. “[The price drops] are progressing up the North Shore,” she says. “It has always been like that, for 25 years. The trends work their way up the North Shore. I think things are happening that indicate to [Lake Forest home sellers] that prices need to come down. Read the papers; listen to the news. Hello.”
Posted at 08:01 AM in Housing Bulletin | Permalink
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Reader Comments:
re Winnetka: the most recent Village budget reflects $5 1/2 million budget shortfall for 2009.
There are "abandoned" and not-ostensibly-for sale homes everywhere--with no one inside. Some owners, who risked building, are making a pretense of having tenants within, so the banks won't give them any pressure.
On west Elm Street, there are 8 houses for sale on one street alone (not all have signs displayed.
Much of (formerly) exclusive (and generally under water) Woodley Rd. and White Oak Lane mansions (huge property base) stands un-tenanted.
On the corner of Prospect and Humboldt and onto Sheridan Road, there are 6 massive houses for sale, some, uninhabited. The one around the corner on Sheridan, at about 800, has been up for $4 million, is a new house, not sold since built about 3 years ago, and never tenanted.
At the corner of Humbold and Sheridan is a huge house on a promontory. Why anyone would build such a monstrosity (it's not that old), is beyond me. Who will buy it now?
How are the unstable banks able to pay any of these mortgages, if the owners have left?
What is the Village going to do about it?
Hi, Fluffyross. I know about some of the houses you mention, but not all of them. Would you be willing to take me on a tour? You can email me directly at dennis@rodkin.com.
All those houses in east Winnetka have been for sale for a long time and have had huge price reductions. Several started over $5 million and are now in the mid $3 mil range.
They will all sell eventually - everything does.