Unemployment 11.0 ninth highest in nation tied with North Carolina. 2nd in Midwest behind only
Michigan

Foreclosure rate 10.03 4th highest in Nation
(California, Nevada,Florida )

Budget Deficit 9B 2nd highest California is #1.

Can you post a link to where you're getting this from, please?

econ map by state

I erred on the foreclosures Illinois ranks sixth. Arizona and Michigan rank higher.

I am trying hard to be optimistic but news reports like this are NOT helping:

More loans fall into delinquency

The scary thing about this news piece is that the mortgages that are going into delinquency are people with GOOD CREDIT and who have managed, thus far, to stay afloat.

I would imagine nearly all of the sub-prime, "toxic asset" class of mortgage have already fallen by the wayside but now this?

Oh, and we have to steel ourselves against HIGHER property taxes as our homes continue to lose value?

For the first time in my life, I am seriously considering leaving Illinois.

I am right now looking at Indianapolis, IN and Madison, WI.

I paid my home off years ago so I'm in the clear on the mortgage front. With the negative appreciation - everywhere else - I likely could still get a better value outside of this state. With the public pension timebomb ticking and a promise of equal or HIGHER property taxes on a declining value? I owe it to myself to at least seriously look elsewhere.

Texas, Iowa, Minnesota, Missouri, Colorado are all doing substantially better than Illinois.

A closer at First American Title told me last summer: "you think this is bad, wait till those 5 year interest only bombs from 2005 hit."

The good news is that, for the first time in 6 months, I got a payoff letter on a Bank of America short sale! Everyone in short sales hates Bank of America.

Real estate around here has gone down but not as much as say some places. So it could work out.
You could sell your place here and buy something that is both nicer and cheaper.

I could sell my home for substanially below even the current [20% down from 2005] market price and still almost triple my money.

How about Iowa? Des Moines maybe?

Nice area. Have friends there and they think its a great area.

I was reading how the Florida real estate market has collapsed. Half Million dollar homes with Ocean views, or on Golf courses.

I wondered if people might start acting like one person arbitragers selling their holdings in areas where the market hasn't totally collapsed and moving to where it has.


The next big real estate worry is commercial real estate and what it would do to smaller banks.

quote:

Originally posted by taxpayer:
I erred on the foreclosures Illinois ranks sixth. Arizona and Michigan rank higher.

Thank you. None of the links are working

In addition to the worries of CRE on the regional banks, there is a very real growing concern that what we're seeing today in the stock market's growth, is another bubble that is being fueled by near 0% fed rates. And we all know what happens to bubbles...the pop! The wrong timing of that pop, could indeed turn this recession into a double-dipper.

I'm in the CRE game, and in it's defense, even though it's a lagging indicator, after nearly 3 years of the worst recession since the depression, CMBS delinquencies are just 4%, a number that was just hit this month. Several trillion$ of CMBS "Commercial Mortgage Backed Securities" bouncing around there, and only 4% delinquent. Relatively speaking, that says something. Plus, CRE has the benefit of lessons learned, and tools created from, the early 90's recession, which it did cause. What the other sectors don't have today, that CRE does thanks to the 90's, is a massive support platform of talent to "service, monitor, and workout" problem assets. Plus, even though many in my industry have said "CMBS is dead forever", it is coming back to life, with extremely positive responses from the investment world. The model of CMBS, which is to provide liquidity to the sector to prevent a credit crunch, remains intact, and proven successful. The other sectors followed, which caused the frenzy of the past 5 years. The model works. It's the people who screwed it up and wrecked everything. That can be fixed, and assuming it will, can play a massive role in preventing the oncoming trainwreck of nearly $700b of maturing loans over the next 18 months from not finding a new home for refinancing. The problem however, remains the new valuations of those properties, and the ability of owners to produce the required equity to reset the proper loan/value ratios going forward. REITs have been all over the place this year with raising unsecured debt via the bond market for this specific purpose. But, the small guy and community banks, as taxpayer says, are really pinned in a corner, since they don't have those avenues to Wall Street that the big boys do, to raise capital.

Speaking from experience, North Carolina's unemployment rates began increasing way before this recession started, thanks to the massive outsourcing of blue collar jobs in the textiles industry. However, can you guess what the two ONLY cities in the entire nation have recently reported positive job growth month after month for the past 3 months? Charlotte and Raleigh. Infact, some are beginning to say that NC might be the first to recover from this mess. Jobs, it's all about jobs. No job = no money to inject into the economic flow = stalled capitalism.

Illinois is a freakin mess, and will remain so until the old thinking of "borrow to operate" is retired. That, and the unions, as evidenced by the massive exiting of conventions in the area. Illinois loses that business, and good luck getting it back. Once it's gone, you've got to lure it back with incentives and such, which is a costly game. Not just for the budget, but for the people who have to make up that loss....with what else...taxes taxes taxes.

One of my bestest business partners lives in Charlotte, NC. Nice town. I visit him anytime I head to Atlanta or points southeast and I can find a day or two out of my schedule.

Quick question: Here in the Kingdom of DuPage, real estate is "assessed" in one of three categories: Commercial, Industrial and Residential.

Residential makes up about 80% of all of DuPage's real estate, perhaps a bit more.

"Commercial" is strictly categorized as any real estate that is not industrial [warehouses, factories, etc] AND not residential.

In other words, "commercial" might be, Stratford Square Mall, the local White Hen Pantry in the strip mall, Wags, Abdul's Discount Liquors and Smokes and all of our fine retail establishments, Oh and all office space too.

Does this square with your definition of "commercial real estate"?

The market is a bubble waiting to burst IMO. S&P valuation alone is ridiculous. My 401K is in index funds to minimize the absurd fees. While I recovered quite a bit this year I'm moving to cash equivalents to avoid what sees to me to be an inevitable POP.

I like WI and have relatives there but BTN- have you checked into WI real estate tax? Not cheap up there. Real estate tax on a nice property can be outrageous. Median tax dollars per home is above Illinois and California.

real estate tax

I agree fan. Trying to find a good state from an economic point of view is like trying to time the market.

One of the more interesting articles I read lately is about how many retirees who go down to Florida and Arizona boomerang back to their hometowns or to where their children live when their health deteriorates. They buy homes on the cheap in what is often nondescript areas of the country. Considering the baby boom it would be wise to consider this when moving or investing in retirement states- glut of housing eventually.

[QUOTE]Originally posted by GE Fan:
"Borrow to operate" is how America has grown and will continue to grow. QUOTE]

Shhhh, don't tell that to Oklahoma City, one of the only MSA's that learned their lesson in the late 80's, didn't borrow out the tail pipe this go around, and are now sitting as one of the best MSA's in the nation because of it.


My definition of commercial real estate is anything that is zoned to produce a revenue stream. I'm not sure how they "assess" here, or what valuation metrics are used, but I would have to assume the tax assessor uses the basic income capitalization approach, with a higher cap rate then an investor would to prevent stagnation through taxes. For instance: In DC, a property generates $100k of annual revenue. The tax assessor will use a 10% cap rate to determine the value ($100k/10%) then assign the mil rates to that value. He uses a 10% rate, as were investors would probably use a 6%.

Whoa NC, this here's Illinois. If I recall correctly there was a big scandal about 20 years ago here with the former York Township Assessor (Oak Brook mall and west) about a lot of under assessed commercial properties. We don't fall for any of that high highfalutin mathematical reasoning. It's who ya know.

Even though I was born and raised here in the Chicago area - have lived here my entire life, in fact - I have soured on Chicago, City of.

What with the outrageous parking situation, ever-increasing fees for things that used to be reasonable [or even free], the highest combined sales tax in the nation [or damn close to it], the never-ending parade of corruption and thievery, a noticeable decline in my local business contracts and so on and so forth, I truly am considering a location change.

Heck, I might rent my house out if I can find a reliable agent.

Oh, and I lived in Chicago for 13 years, back in my wilder youth.

I'd never even consider living there now.

That's a good reason to move.

I was raised in IL also (though I lived for short times in other states). My wife and I would like to leave as a semi-retirement move. Almost have the financial means, but that pesky health insurance issue- can't get it being diabetic. Wife's family is from Michigan and cripes- you can buy a pretty nice house outside of most urban areas for the price of a used car.