Chicagoland real estate purchases, real estate sales, short sales, foreclosures, first-time buyer representation, Illinois condominium association representation, estate planning for everyone, powers of attorney, quit claim deeds and more...

Recently I have had a number of clients call me regarding contracts that they have on new construction condominiums. Seems that many projects are in trouble, and people are wondering what's going on with their development.

Crain's Chicago Business had a very interesting article on some of these projects that are currently stalled. ("Stuck in Condo Limbo", January 26, 2009) I know I have a client purchasing in at least one of them. The issue is that most of these contracts do not have a "drop dead" date in which the developer has to complete and close the project, so people (and their earnest money and other deposits) are in limbo.

As a buyer's attorney, I have asked for a drop dead date for any client within attorney review for new construction projects, but most of the time the developer does not agree, and the buyer typically still wants to proceed. Little did anyone know when these contracts were negotiated one, two or even three years ago, that we would be in the position we are now.

Now more than ever, beware when buying new construction property. I am now more strongly advising buyers to insist on a drop dead date depending on where the construction is in a project. Even reputable developers can have issues with certain projects.

Among the projects listed specifically in the article are X/O Condominiums, located at 1712 S. Prairie; Solstice on the Park, located at 1616 E. 56th Street; Peshtigo, located at 515 N. Peshtigo Court; Chicago Spire, located at 400 N. Lake Shore; Waterview Tower, located at 111 W. Wacker Drive; Lincoln Park 2520, located at 2520 N. Lakeview; and Glashaus, located at 1327 S. Wabash.

Mortgage rates are low, low, low! Last week the average mortgage rate for a 30-year fixed loan dropped to 4.96 percent. Just a few months ago, it was sitting steady at 6.5 percent.

But how can you qualify for such low rates? A great credit score is a must. You must have a FICO credit score of 720 or higher (out of a possible 850). You will get a competitive rate at 680, but the lowest rates go to 720 or higher.

Don't know what your score is? You can get it once a year from free at www.annualcreditreport.com.

It's also still possible to obtain a loan with less than 20 percent down, but you will have to pay PMI (private mortgage insurance) in order to do so. 

The best advice I can give to any client is to shop around. Sometimes banks have the best deals. Sometimes I see mortgage brokers with the best deals. Shop around to at least two or three places before you buy.

According to a survey recently published by Urban Land Institute, the Chicago real estate market has moved up in its outlook among real estate professionals. Chicago ranked 10th among major U.S. cities in the survey, behind Seattle, San Francisco, Washington, D.C., New York, Los Angeles, Houston, Boston, Denver and Dallas/Fort Worth. Last year, Chicago ranked 12th.

Respondents to the survey gave Chicago a rating of 5.1 on a 9-point scale, down from 5.5 in last year's survey, however, Chicago is doing much better than other Midwestern markets, according to Jonathan Miller, the principal author of the report. The overbuilt condo market, which is having a negative spillover effect on to apartments and condo investors, was to blame for the negative ranking, but the bid for 2016 Olympics did help Chicago's ranking.