Friday, July 20, 2007

Another appellate court case regarding residential real estate...

I've been seeing a bunch of appellate court holdings regarding residential real estate closings lately. Know your case law when you're advising clients on the various disclosures and attorney modification letters or beware...people really do sue in this area:

Breach Of Contract/ Residential Real Estate Disclosure Act / Fraud 1st Dist. Fox v. Heimann, No. 1-06-0414 & 1-06-0697. Affirmed Defendant waived any challenge to the sufficiency of the plaintiff's complaint by failing to file 2-615 motion to dismiss; which is not overcome by filing motion for summary judgment. Further, requirement in Residential Real Estate Disclosure Act to notify buyer of material defects in the property being sold is implied in contract and forms the basis for a viable cause of action for breach of contract. In addition, evidence that previous owner informed sellers of material defects in foundation, coupled with expert testimony from plaintiffs' expert, support trial court's finding in favor of plaintiff for breach of contract. Also, trial court's finding that defendants did not commit actual or consumer fraud is not against manifest weight of the evidence; because court found that defendants did not deliberately mislead the plaintiffs.

Saturday, July 14, 2007

Are you really saving going FSBO?

I'm not going to go into the different studies about whether or not using an agent gets you a better price or not...that data's out there and it's valuable reading. What I'm going to discuss is more the "life" or "stress" costs that both the FSBO and non-lawyer-using property seller faces.

I just have a few real estate transactions going right now where the clients are so stressed out and panicked essentially because it's a lot of work to go FSBO and on the legal side they don't know what they're doing. Sometimes it's a personality thing and if you're sort of edgy/nervous to begin with then you may want to keep the stress down. Particularly if there's both a buy and sale involved...that's double-trouble and I'd bet most real estate lawyers would cut their fee for doing two transactions.

I think it's a great skill (beyond just selling real estate) to know where you're weak and get outside help in those can't be successful doing everything yourself!

Flat fee MLS listings

New to me, had a client who used Flatland Homes for a flat fee MLS listing. Essentially for $299 your property gets on the MLS and Buyers agents can see that you're out there. The one experience I heard about was very good and successful

Growth of Older Americans study

I think a must read regarding the defining demographic trend of the next 25 years or interesting study by Brookings, "Mapping the Growth of Older America."

One interesting finding directly related to real estate: Aging Baby Boomers will cause the suburbs of Chicago to become older than the city by 2040.

Foreclosure resource

The Homeownership Preservation Foundation has some nice tools for people in a financial pickle.

Thursday, July 12, 2007

Interesting "attorney approval" case

Here's an interesting new case discussing the attorney approval language in a typical real estate contract:

Patel v. McGrath, No. 2-06-0472 (June 29, 2007) DuPage County (O'MALLEY) Reversed and remanded Trial court erred when it dismissed prospective buyer's complaint seeking specific performance of real estate purchase contract. Because correspondence from buyer's attorney, pursuant to attorney approval clause, specifically states that it was neither rejection of contract nor counteroffer; it served merely as a proposal for modification; and did not preclude binding contract. Further, correspondence from seller's attorney with no explanation for rejection of contract, coupled with re-listing of property for substantially higher price, creates material issue of fact by raising presumption that rejection was for price, a reason expressly prohibited by written agreement.

I'd suggest you read the case in its entirety...a very interesting discussion on what the attorney approval contingency in a real estate contract means. This may cause me to change some of our policies. I always said that anything you're doing under "attorney modification" was a counteroffer. Yet this case seems to say the neither rejection of contract nor counteroffer language in the attorney's letter takes it away from being a counteroffer. We'll see how this proceeds...I think it conflicts with other appellate court holdings.

High-end real estate market is strongest

NYTimes had an interesting piece discussing how much of the high end market remains stronger than other market segments.

"...the high end of the market is surviving the slump much better than any other segment. Even as foreclosures keep rising and overall sales continue to plummet, more expensive homes have staged a bit of a comeback in recent months. They’re spending less time languishing on the market than others, and their prices appear to be holding up better."

Not much discussion of the Chicago market...if you're not in N.Y., CA or London you don't seem to get the same attention in the Times.

The article provides some examples illustrating the different ends of the spectrum. Here’s why the market is still going strong for super-expensive homes:

**The rich aren’t affected as much by the stagnant payrolls.
**Foreign investors swoop in when the dollar is cheap.
**Low and middle income families are hurt more by higher interest rates and the meltdown of the mortgage market.

Saturday, July 07, 2007

Chicago suburban office market

Nice overview in the Trib. about the strength of the suburban rental office market.

The suburban office market perked up a bit in the first half of 2007, but with a vacancy rate of 18.5 percent it still has a long way to go to return to past peaks, according to a report from Cushman & Wakefield of Illinois Inc...

While locations just north of Chicago such as Evanston and Skokie are gaining steam, some western suburbs, including Naperville, Lisle and Lombard, are slogging along, he said, citing Cushman's report of second-quarter market activity...