WASHINGTON – Sales of previously occupied homes took the largest monthly drop in more than 40 years last month, sinking more dramatically than expected after lawmakers gave buyers additional time to use a tax credit.

The report reflects a sharp drop in demand after buyers stopped scrambling to qualify for a tax credit of up to $8,000 for first-time homeowners. It had been due to expire on Nov. 30. But Congress extended the deadline until April 30 and expanded it with a new $6,500 credit for existing homeowners who move.

“It’s ‘exit stage left’ for first-time homebuyers,” wrote Guy LeBas, an analyst with Janney Montgomery Scott.

December’s sales fell 16.7 percent to a seasonally adjusted annual rate of 5.45 million, from an unchanged pace of 6.54 million in November, the National Association of Realtors said Monday. Sales had been expected to fall by about 10 percent, according to economists surveyed by Thomson Reuters.

The report “places a large question mark over whether the recovery can be sustained when the extended tax credit expires,” wrote Paul Dales, U.S. economist with Capital Economics.

The median sales price was $178,300, up 1.5 percent from a year earlier and the first yearly gain since August 2007. However, some of that increase could be due to a drop-off in purchases from first-time buyers who tend to buy less expensive homes.

Sales are now up 21 percent from the bottom a year ago, but down 25 percent from the peak more than four years ago.

The big question hanging over the housing market this spring is whether a tentative recovery will stumble after the government pulls back support. The Federal Reserve‘s $1.25 trillion program to push down mortgage rates is scheduled to expire at the end of March — a month before the newly extended tax credit runs out.

Last year, first-time buyers were the main driver of the housing market, but their presence is on the decline. They accounted for 43 percent of purchases in December, down from about half in November, the Realtors group said.

The inventory of unsold homes on the market fell about 7 percent to 3.3 million. That’s a 7.2 month supply at the current sales pace, close to a healthy level of about 6 months.

Total sales for 2009 closed out the year at 5.16 million, up about 5 percent from a year earlier. That was the first annual sales gain since 2005. But prices fell dramatically last year, declining 12.4 percent to a median of $173,500, the largest decline since the Great Depression.

Though the results missed Wall Street’s expectations, the Realtors’ group says there are signs the market is finally stabilizing.

“There is some sustainable momentum building in the housing market right now,” said Lawrence Yun, the group’s chief economist. However, he cautioned that the recovery will depend on whether the economy starts adding jobs in the second half of the year.

Many experts project home prices, which started to rise last summer, will fall again over the winter. That’s because foreclosures make up a larger proportion of sales during the winter months, when fewer sellers choose to put their homes on the market.

Despite fears that home prices are starting to fall again, some analysts still believe the worst is over.

“We do not believe it is fair to consider this a double dip in the housing market,” Michelle Meyer, an economist with Barclays Capital, wrote last week. “The recovery is still under way, but hitting some bumps in the road.”

Yahoo.com

As the temperature drops and the snow piles up, it’s easy to forget that spring is quickly approaching. And after more than three years of a painful housing swoon, real estate experts predict that lower prices, attractive mortgage rates, and a tax perk from Uncle Sam will create the most vibrant spring home selling season in some time. “This is going to be probably the most pleasant experience for a home seller in the last four or five years,” says Mike Larson of Weiss Research. “If you have been beating your head against a wall, this is going to feel a lot better.” But even if the market does perk up, buyers are likely to retain the upper hand throughout 2010. So to help property owners get the best selling price they can–without burying themselves in expenses–U.S. News has created a list of 10 cheap ways to boost a home’s sales price by spring:

1. Retouch the front shell

If your property’s exterior isn’t appealing, no one will want to see your newly remodeled kitchen. So property sellers must first ensure that their home projects a cozy, inviting feeling. “The shell–the outside front–is probably the most important area for improvement, the area where you can make the biggest improvement with the smallest amount of cash,” says Pat Lashinsky, the president and CEO of ZipRealty. Touching up the paint on the front-entry portion of the house can be an inexpensive but effective way to make the entire property more inviting, Lashinsky says. “Really focus on that outside, external shell,” he says. “You would be amazed by the amount of people that drive by a house and say, ‘Ah, that’s not for me.’ And they can tell just by the way the upkeep and the outside looks.

2. Trim the greenery

Ensuring that the lawn, hedges, and flowers are well maintained helps make your home more alluring to prospective buyers as well. Property owners can hire professional landscapers or break out the lawn mower and get busy themselves. “Many people have landscaping that is overgrown and too heavy, and it is concealing a lot of the house,” says Paul Zuch, the president of Capital Improvements. “Trim the trees, trim the hedges … [and] add a little color to the flower beds.”

3. Paint the interior

Putting a fresh coat of paint on the home’s interior is a cost-effective way for sellers to make their home more appealing to buyers, says Ron Phipps, a broker with Phipps Realty in Warwick, R.I. But when choosing the color, homeowners should be conservative. “The caution is that your favorite color may not be the favorite color of the buyer.” Instead, homeowners are best off using neutral colors, Phipps says. “Go with something that is a very light yellow or a light cream with a contrasting white, so it just looks very fresh and crisp . … Having the paint in good condition is almost more important than the color.”

4. Don’t forget the floors

Improving the condition of a home’s flooring is also a smart move for sellers–and you don’t need to refinish wood floors or install new carpets to make them more attractive. “If it’s a hardwood [floor], has the floor been buffed?” says David Lupberger, a home improvement expert with ServiceMagic.com. “If you have carpets, have the carpets been cleaned?”

5. Make all major repairs

Because tighter lending standards demand higher down payments, today’s home buyers won’t have much cash left over for improvements once they’ve made their purchase. So it’s imperative for sellers to make all major home repairs–fixing the leaky roof, rebuilding the front stoop–before they put the property on the market. “Repairs can’t be ignored, because nobody has any extra money,” Phipps says. To determine what needs to be done, property owners can scrutinize their homes themselves or bring in a home inspector to examine the property professionally. “The home inspection piece I think is something that is a huge value, particularly if there is something that is a question,” Phipps says.

6. Put appliances under warranty

To give buyers more confidence in a home’s appliances, Phipps recommends that sellers put them under warranty. Sellers can buy home warranties–which cover repair and replacement costs for many home appliances–from several different firms. “If I have got a 40- or 50-year-old house, it is going to be harder for me to persuade a first-time home buyer with a limited amount of cash to buy it because they will say, ‘Well, what happens if something breaks down?’ ” Phipps says. “If I have a home warranty … that solves that problem.”

7. Make energy-efficient home improvements

Increasing your home’s energy efficiency is another good way to make your property more attractive to buyers. Many such improvements–such as new windows or better insulation–come with federal tax benefits. In addition, a growing awareness of human impact on the environment means homes that have these upgrades will stand out from other listings. “If you have some cruddy old windows that are leaky and just not energy efficient, you can put in new replacement windows and take advantage of the tax credit,” Zuch says. “It’s not green washing. Those are really practical things that make your house more sellable.” Many contractors will conduct a so-called energy audit free of charge to determine where efficiencies can be created, Zuch says. “If your house is more energy efficient-you use less energy, it’s better insulated-it is going to be more desirable for a potential buyer,” he says.

8. New light fixtures

Replacing old or broken light fixtures with new ones can also be a low-cost way to add value, Lupberger says. Installing a nice new light fixture in the foyer near the home’s entrance can be a particular benefit, he said, because it can make a strong first impression on would-be buyers. Creating an inviting feeling in the interior entryway, in turn, helps get home shoppers more interested in checking out the rest of the property. “I am not going to redo the house,” Lupberger says. “But I can update those features so that somebody can walk in and say, ‘You know what? [the homeowners] took care of this.’”

9. New stove in the kitchen

While some homeowners might think the only way to jazz up a dated kitchen is a full-on remodeling job, Lashinsky recommends a much less costly alternative: buying a new stove. “If there is an updated stove in the kitchen, it is amazing how that draws people in, and people say, ‘Wow, this kitchen is going to be great,’ ” Lashinsky says. While upscale homeowners may have to shell out for top-of-the-line appliances to maintain their kitchen’s décor, others can budget well under $1,000 for the upgrade. “You can get a really nice stove for $700 or $800,” Lashinsky says. “You can basically have the look of a new kitchen that is going to be really enticing to someone-and what you are really trying to do is differentiate your house from somebody else’s.”

Property owners in neighborhoods where most homes have granite countertops can consider making this upgrade as well. But Lupberger says the project makes sense only for homeowners with extremely dated kitchens that are going to serve as a serious impediment to finding a buyer. A real estate agent with experience in the local market can help you determine whether or not the upgrade is essential, he says.

10. Freshen up the bathrooms

Getting rid of mildew stains on the bathroom caulking can boost a home’s appeal as well. Such stains “scream, ‘These people haven’t taken care of this house. It’s going to be a money pit,’ ” Zuch says. Use a razor blade to remove the old caulk, and replace it with new, mildew-resistant caulk, Zuch says. And rather than remodeling the entire space, homeowners can reinvigorate a worn-down bathroom by replacing cracked sinks, Lupberger says.

Yahoo

If you’re getting ready to put your house on the market, you have my condolences. It’s no secret that the real estate market is extremely tough right now, particularly for sellers. Because the U.S. housing market is flooded with unsold inventory, homebuyers have countless choices available to them – which gives them all the power. If your home doesn’t suit their fancy, they’ll simply move along to next house on their mile-long property list. (Read Selling Your Home In A Down Market and Closing A Real Estate Deal In A Down Market for some tips on how to make it easier to sell your house.)

With this in mind, you’re probably thinking about making some home upgrades that are certain to attract flocks of admiring buyers. While it’s certainly a smart move to make a few improvements, don’t overdo it. If you spend stacks of cash on remodeling expenses, you’ll probably never recoup your investment – especially in this buyer’s market.

So how do you know which upgrades are worth the hassle and which ones aren’t? For the most part, real estate experts agree that new kitchen counter-tops and appliances, bathroom remodels and energy-saving improvements will pay off in the long run. On the other hand, pros point out that these four upgrades aren’t worth your time and money.

1. Over-the-Top Improvements
   Before you invest tons of money into an elaborate full-house renovation project, consider what the competing properties in your neighborhood have to offer. While you want your house to stand out from the competition, you shouldn’t make unwarranted upgrades that greatly exceed other properties in the area.  Not only will you end up losing money, but you may even scare off potential buyers.

   Look at it this way: Let’s say you show up to your nephew’s third birthday party wearing a ball gown when all the other guests are wearing jeans and t-shirts. Wouldn’t you feel a little out of place? Likewise, if you were to transform your cozy cottage into a luxurious, three-story mansion, it would probably stick out like a sore thumb in your neighborhood of modest ranch-style homes.

   Find out how similarly priced homes in your neighborhood measure up, and make improvements based on your specific marketplace.

2. Swimming Pools
   This one is a big surprise for many homeowners. Believe it or not, a swimming pool rarely adds value to a home in this day and age. First of all, it usually costs a small fortune to have an in-ground swimming pool installed. Secondly, you’re probably not going to recoup your investment. Why? Because many homebuyers view an in-ground swimming pool as a high-maintenance hassle and safety hazard.

   When a homebuyer sees an in-ground pool in your backyard, they may have visions of spending ridiculous amounts of money and time on pool maintenance chores. Plus, buyers with young children often steer clear of homes with pools because of safety concerns. In other words, home buyers are more likely to view your in-ground pool as an inconvenience – not a selling point.

3. Replacing a Popular Feature
   Before you consider making a major home change, such as converting your garage into a game room, take a look around. If every other home in your neighborhood boasts a two-car garage, you should probably think twice. Do you really want to be the only house in the area with no garage? Most homebuyers would prefer to have a sheltered place to park their car than a room to play ping pong and darts.

4. Daring Designs
   We all want to design and decorate our home so that it reflects our unique style. However, if you’re trying to sell your home, now is not the time to incorporate bold design choices into the décor. For example, if you have lime-green granite countertops, leopard-print wallpaper, lavender carpet and an elaborate mural of chubby cherubs painted on your bedroom ceiling, one look will send home buyers dashing for the door.

   If your home beams with your eclectic tastes, try to tone it down before you plant that “For Sale” sign in the front yard. Tear down the flamingo wallpaper and slap a fresh coat of neutral-colored paint on the walls. Replace the lilac carpet with a standard beige or brown, and get rid of any extremely personal features that would be considered “abnormal” as opposed to “traditional.” Homebuyers should be able to imagine themselves living in your home – and that’s practically impossible to do if there are mounted deer heads peering down at them from the walls of every room.

Overall, it’s good to put some work into your house before you try to sell it, as it can add value and make it more attractive to potential buyers. However, there are some things that will have the buyer running for the door - or will at least not add anything to the house’s closing price. Keep these things in mind when you’re getting ready to put up that “For Sale”sign. (For more on selling your house, check out Top 4 Things That Determine A Home’s Value and Will You Break Even On Your Home?)

Investopedia

Are you in the business of building homes or building better communities? Do you offer more than a “great” buy? Does your product help or hinder the environment? According to the third annual Edelman goodpurpose^TM Consumer Study your answer to these questions may just affect your future sustainability as a real estate builder, developer, contractor, remodeler, etc. The survey found that despite the recession, consumers are still spending with companies and brands that have a social purpose. New findings released from the survey of 6,000 people in 10 countries, revealed that during this recession, 57 percent globally say a company or brand has earned their business because it has been doing its part to support good causes.

“People all over the world are now wearing, driving, eating, and living their social purpose as sustained engagement with good causes becomes a new criterion for social status and good social behavior,” said Mitch Markson, Edelman’s chief creative officer, president of its brand consulting group and founder of goodpurpose. “This gives companies and brands associated with a worthy cause an opportunity to build long-term relationships with consumers that, in turn, allow them to feel valuable within their communities.”

The study also found that 83 percent of people are willing to change consumption habits if it can help make the world a better place to live, indicating a startling consumer shift and trend away from traditional status markers like big houses and luxury cars and toward identification with social purpose brands. Considerably more people (70 percent) would prefer to live in an eco-friendly house than merely a big house (30 percent), and 68 percent also now feel that it’s becoming more unacceptable not to make noticeable efforts to show concern for the environment and live a healthy lifestyle, with an overwhelmingly 80 percent preferring to support the livelihood of local producers.

“People are demanding social purpose, and brands are recognizing it as an area where they can differentiate themselves and in many parts of the world, not only meet governmental compliance requirements, but also build brand equity,” said Markson. “This year’s study shows that if companies respond intelligently to the sea change in consumer attitudes, brand loyalty among consumers – even during seriously challenging economic times – will actually grow. Even better, consumers will want to share their support for these brands with others.”

While the study reveals that social purpose is becoming increasingly crucial to a brand’s success, a brand purpose must be authentic and true to the core values of the brand itself, and brands must look beyond traditional corporate social responsibility programs in which they simply donate money to a good cause. As the study notes, 66 percent of people believe that it’s no longer enough for corporations to merely give money away, but that they must integrate good causes into their day-to-day business.

“Companies that become catalysts for social change and respond to rising consumer expectations that they and their brands help make the world a better place will not only survive, but also thrive, in ways their competitors will not,” said Markson. “Mutual social responsibility provides that opportunity, as people today are more passionately involved and supportive than ever, yet more demanding and unforgiving, as well.” These numbers would indicate those real estate builders, developers, contractors, remodelers and others who want to survive in this economy and those in the future would be wise to adhere to the behaviors of consumers who want social change and environmental awareness.

RealtyTimes.com

If you listen closely, you can hear the faint sound of crews delivering drywall and carpenters firing nail guns.

In Aurora, M/I Homes Inc. just closed a deal with a lender to buy lots for 60 town homes at The Plaza on New York, formerly a Wiseman-Hughes Enterprises project.

On Joliet’s east side, Cambridge Homes recently completed the purchase of lots for 42 single-family homes and duplexes, and options for 38 more in NeuFairfield, a project started by now-defunct Neumann Homes Inc.

And in Lynwood, J. Lawrence Homes LLC has started marketing homes in Ambry Estates, a single-family community where the company purchased more than 90 lots six months ago that were destined for high-end homes. The homes will start at $230,000.

Last year was the year that local and regional builders, who once dominated the market, vanished. They left very publicly, as in the case of longtime companies such as Kimball Hill Inc. and The Kirk Corp. which sought to restructure but were forced to liquidate, or very quietly by taking down their Web sites, unplugging their phones and locking their model homes.

This year is the year in which the healthier rivals take advantage of cheap land and tailor their product to generate demand.

So, buyers who want a brand-new home in 2010 will find more available, close to transportation and at better prices than in years past.

“The average consumer does not need to go out to the outer growth ring to get affordable housing,” said Ron Martin, M/I’s Chicago-area president.

The magic marketing price for most builders is $300,000 or less, but those funds go further than they once did. Builders that have taken over competitors’ projects are cutting home prices by $50,000 or more, primarily because of cheaper land costs.

“Builders were able to get lots at a much-discounted price, so they are going to be able to deliver very affordable housing product,” said Chris Huecksteadt, director of the Chicago region of Metrostudy, a provider of housing market data and analysis. “They haven’t lessened the construction standards; most municipalities won’t allow it. What’s changed is their (cost) basis.”

While not as hard hit as homebuilding elsewhere in the nation, the local market practically came to a standstill in 2009, as only about 3,000 new single-family homes and town homes were started, according to Metrostudy. That compares with 2005′s peak building year, when ground was broken for almost 34,000 new homes.

The moves by some builders, though, shouldn’t be interpreted as a return to those heady days. Builders believe there’s some pent-up demand as families form or change shape. Still, a state jobless rate just under 11 percent and stricter lending standards may dampen consumers’ enthusiasm to take on the debt of buying a home.

Companies’ ability to borrow funds also will keep the lid on any overzealous plans.

“One thing that was always a good thing about a recession is you get a lot of fly-by-nighters out of the business, the lawyer that wants to be a builder,” said area builder John Hall Jr., who is getting ready to break ground in Elgin for the first time in 18 months.

“The one thing that was different about this one is we had a lot of well-sustained homebuilders lose their business too.”

Those who do venture into the market are likely to see the most activity from large, publicly held, better-capitalized companies. Three companies based elsewhere — Pulte Homes Inc. (based in Michigan), Cambridge Homes (a division of D.R. Horton Inc. in Texas) and The Ryland Group (California) — control 25 percent of the market.

“That’s a lot for a market that had been very fragmented,” said Lance Ramella, principal at RW Real Estate Advisors. “There just aren’t that many private builders left. They’ve hunkered down. The top six builders in the market are all public. In the past, that never happened. That’s the kind of stuff that happens in Tucson (Ariz.).”

From all indications, it appears their efforts to dominate the local market are picking up steam, and there is no shortage of lots available that have water and electrical service and a paved street.

The only hitch is how much the lenders controlling the acreage are willing to discount it.

“Some banks still have unrealistic expectations and don’t want to get it off their books,” said M/I’s Martin, whose Shelburne Crossing town home project in Winfield was started by Kimball Hill. “Others are saying that rather than hold onto this asset for three to four years, let’s get it off the books now.”

Though not making any deals yet, Pulte is seriously looking at a dozen area properties, said Steve Atchison, president of Pulte’s Illinois/Michigan division

Cambridge, while undertaking the new project in Joliet, also remains in the market for more lots. “The bottom of the market is behind us,” said David Smith, marketing vice president.

Market analysts also say the local and regional builders that have gone quiet shouldn’t be written off, because many will return but with far less-grand plans and likely different names.

“They’re waiting in the wings,” Huecksteadt said.

Other local builders, optimistic but also realistic, are cautiously dipping their toe back in.

That’s why, in addition to starting the Lynwood project, J. Lawrence Homes is building a spec home, just one, in each of its communities.

“We’re seeing a light at the end of the tunnel,” said company President John Wozniak.

“We’ve started to advertise again. The more we’ve done it lately, the more we’ve seen people show up. We feel we’re heading into a new market.”

Mary Ellen Podmolik
Chicago Tribune

‘Twas only a few years ago, when the housing boom was in full roar, that homeowners didn’t have to fret too much over whether the money they invested in remodeling would be paid back at resale time.

Indeed, it was practically a no-brainer: Home sale prices were going up so high and so fast that remodeling the kitchen or the master bath would nearly pay for itself. Some remodeling companies had so much backlogged work that clients passed the time on waiting lists.

“These days, it’s a new ballgame,” said Sal Alfano, a former contractor who now is the editorial director for Remodeling magazine, a trade journal. “Now, the jobs are smaller, the scope of work has been cut back, and consumers are doing things in phases.”

And, he said, consumers are squinting harder at contractors’ estimates, not only to push down costs but also to decide whether the price of that redone kitchen or master bath is going to pay them back anything when it comes time to sell in a market that has become notoriously fickle and with home prices sliding.

Such born-again cost-consciousness makes complete sense in the current economy, Alfano said, but he’s concerned that the infatuation with the contractor who offers the lowest bid will come back to haunt consumers.

Each year, Alfano’s magazine partners with the National Association of Realtors to produce the Cost vs. Value Report, a massive numbers-crunch that tries to ballpark the return on investment for dozens of home-improvement projects, nationally and regionally, in addition to numerous metro areas, including Chicago.

It’s an ongoing slide, he said. Nationwide, the payback at sale on remodeling, in general, peaked in 2005 (the height of the housing boom) at 86.7 percent, according to the magazine survey of the remodeling industry and NAR members.

“That is,” he said, “it was costing you 13 cents on the dollar to build just about anything (if you were selling the house in a relatively short period).

“That’s pretty cheap,” he said. “Then it sank like a rock, ending up at 76 percent, or 10 points lower than the year before.”

In the 2009 survey, the average payback, nationally, was about 64 percent, according to magazine data.

That’s almost exactly the average for 33 remodeling projects analyzed in the Chicago area in the 2009 survey. Heading the costs-recouped list here were not the glamour kitchen/bath projects, but smaller-scale and more utilitarian jobs.

The best returns here, according to the report, were on midrange entry-door replacements (115 percent return at sale) and upscale fiber-cement siding replacements (85.8 percent).

The magazine extensively defines the parameters of each project, citing specific materials and overall price ranges, all gleaned from cost-estimating software used in the remodeling industry. In addition, this year 4,000 members of the Realtors’ group weighed in on how the improvements might pay back at resale in their local markets. The full report is at remodeling.hw.net.

A midrange major kitchen remodel in Chicago (average cost: $67,332) recouped about 67 percent at sale time. An upscale bathroom remodel here ($63,402) recouped about 50 percent, according to the study.

Despite the data, not all consumers are reining in and battening down, some remodelers say.

“For the people who have the ability and want to do a kitchen remodel, I’m not seeing them skimping,” said Bryan Nooner, chairman of Distinctive Remodelers in Orland Park.

“Pretty typically, we’re seeing kitchen remodels in the $40,000 to $70,000 range. They’re spending what they want to. They still want the granite (counters), they want upgraded wood-cabinet species such as maple or cherry, and we’re doing few standard wood stains — most everybody wants a hand-rubbed finish.”

One of his recent clients, Frank Toland, said resale value wasn’t a consideration when he recently remodeled the kitchen of his Mokena home. He said the job cost about $70,000, in addition to upgrades elsewhere in the house that were done at the same time.

“Resale really didn’t factor in at all,” Toland said. “We’re not planning on moving. We’re planning on staying there, and that’s why we decided to do it the way we wanted.

“We hope that the money we put in, eventually we’ll get it out. But we said, let’s do it the way we want it done rather than cut costs because of resale value.”

Matt Draus, who owns Descon Construction in Oak Park, also said he’s hearing from customers who are thinking long term.

“We see people who have a little bit of money and decide they’re not going to move for five years because of the real estate market,” Draus said. “But we’re not seeing the big blowout room additions.”

Instead, he said, he’s seeing smaller projects and more emphasis on maintaining and updating existing features.

But more so than in recent years, he said, money talks.

“Cost is definitely getting much more scrutiny now,” he said. “It’s all about cost, that’s a No. 1 priority.”

But Draus said that bottom-lining often seems to be coming at the expense of quality. Driven by the slumping economy, the remodeling-industry ranks are swollen with newcomers and some tradespeople who are eager to have any income at all, he said.

“I’m [offering estimates] against people who aren’t honest and upfront and are low-balling it in order to get the work,” he said. “There are a lot of good builders out there, but there are a lot of others who are making times harder for the rest of us.”

Alfano agreed, and urged homeowners to be cautious when considering bids that are significantly below competitors’.

“What we couldn’t account for [in estimating costs for the magazine study] was the number of jobs where the contractor cut his overhead or his profit just to keep busy, hoping that things would turn around,” Alfano said.

“Others are former new-construction builders who don’t yet know that they can’t really do a job for a large percentage less” than competing bidders, he said.

Draus said he’s seeing some companies agree to jobs that unquestionably are money-losers for them, just to keep some cash flowing, sometimes with disastrous results for all.

“[A homeowner] might get a bid of $1,000 from a guy who’s about to go bankrupt or a $3,000 bid from a guy who is competent and stable,” he said.

“I’ve been called in to finish jobs for people who took the $1,000 bid,” he said.

64%

The national average percentage of remodeling costs recouped upon selling a home. That means it costs 36 cents on the dollar to build just about anything for your home.

In the Chicago area, the best returns were not the glamour kitchen/bath projects, but smaller-scale and more utilitarian jobs.

115%

Return on sale for replacing an entry door with a midrange substitute

85.8%

Return on upscale fiber-cement siding replacement

67%

The average payback on a midrange major kitchen remodel

50%

What you’d recoup on the average upscale bathroom remodel

By Mary Umberger

Chicago Tribune

The popular image of wind power is of a windmill-like tower cranking away on the prairie.

The wind power at Kathleen O’Donnell’s North Side home, however, comes from a rooftop device that vaguely resembles a barber pole, without the red-and-white stripes.

O’Donnell has installed an 8-foot-tall wind turbine at her Ravenswood Gardens home, where since October it has harnessed the breezes to provide some of the electricity for the former two-flat that she and her husband spent about a year converting into a single-family home.

The premise is fairly simple: The device’s helical-blade scoops catch the wind, forcing it through the turbine and to the home’s generator, creating electricity. If the wind isn’t blowing, the home is powered by the energy grid, as usual.

An architect, O’Donnell realizes she’s something of a pioneer when it comes to wind turbines in residential use.

“It’s a little bit new,” she said. “Wind is not as ubiquitous as solar, in terms of what people are willing to do.”

But maybe not for long. She notes a broader willingness to embrace energy-conserving products these days. Such acceptance has come a surprisingly long way in a just a few years, she said, and solar panels, geothermal heating and even green roofs don’t get as many quizzical looks as they used to.

Usually, it’s all about that other green, she said — cost.

“The ‘want’ is out there, but the ‘will’ is lagging,” O’Donnell said. “Everybody wants it (when clients) call, but when they’re told this is this much money, and it will increase their overall costs, then reality begins setting in, and they start cutting it.”

Wind power is pretty much an unknown, as far as public acceptance, she said.

“Some people might look at wind and say it’s a vanity thing,” she said. “It’s untested. We just don’t know about its (economic efficiencies). The payback is probably going to be better than solar. Maybe in a year or six months we’ll be able to extrapolate that” at her house.

So she’s using her own home as a guinea pig, to an extent.

“I’m committed to it and want to make my own personal investment to suit my own pursuits and for my goals for green building,” she said.

The costs are not insignificant. Her wind turbine (manufactured by Helix Wind Corp. in San Diego) lists for $7,500. In addition, there were costs for labor, installation, wiring, permits and fabrication of a steel structure and base to support it, which drove the total to roughly $16,500, she said.

The device is capable of fully powering her home, but because it’s so new (installed in October), she hasn’t been able to monitor its energy output precisely. In the spring, she said, she intends to incorporate solar panels to help power the house, in addition to green-roof technology to help heat and cool the house.

O’Donnell may eventually move Tripartite Inc., her architecture practice, into her home, which will complicate her energy use, she said. On the other hand, it could make such conservation measures more valuable.

“I’m skeptical that the turbine is going to (cover) our total energy use, but at least it will be a large portion,” she said. “If we have an office in here and we have a lot of computers going, it will use a lot more energy.”

Nonetheless, she said, the days are gone when a homeowner can do a major renovation and not think long and hard about energy-conservation features.

“We’ve turned a corner,” she said. “You can’t do a rehab and not put in the insulation and the (efficient) windows.

“With all these houses on the market, and (a homebuyer) has to make a choice between house A and house B, and house A has a green aspect and house B missed the mark, I don’t know how you’re going to sell house B.”

Hear Mary Umberger at 12:49 and 11:15 p.m. Tuesday and Thursday and at 10:30 a.m. Saturday and Sunday on WGN-AM 720. Write to her at Money & Real Estate, Chicago Tribune, 435 N. Michigan Ave., 4th Floor, Chicago, IL 60611 or send e-mail to housingnews@comcast.net.

Mary Umberger Chicago Tribune

(Crain’s) — A company formed to develop a 102,000-square-foot shopping center in Glenview has filed for Chapter 11 bankruptcy protection, thwarting a mezzanine lender’s plan to auction off the company’s stake in the project.

Central Park Development LLC had pledged its membership interest in the development at 600 Milwaukee Ave. in the north suburb as collateral for a $5.2-million loan from a subsidiary of lender CF Capital Partners Inc. The financing helped the developer launch construction last year, just months before the economy plunged.

Chicago-based CF Capital scheduled an auction for last Monday to sell the ownership stake in the partially built project, according to a public notice. But Central Park blocked the auction by filing for protection from creditors Monday in U.S. Bankruptcy Court in Chicago.

Mezzanine lenders typically hold such auctions only when a loan is in default, but the notice did not say why CF Capital was selling the stake. CF Capital Principal John Cadden declined to comment.

Northbrook-based Central Park member Hyun “Steve” Kang could not be reached for comment, and Mr. Kang’s attorney did not return a phone call.

Central Park picked a tough time to launch the project, as retailers nationwide have closed stores and scaled back expansion plans. Locally, the retail vacancy rate in the third quarter rose to 11.7%, the highest level since 1994, according to CB Richard Ellis Inc.

But news of the proposed retail project’s troubles still surprised Glenview Director of Development Mary Bak, who said the village thought the development was progressing, even though Mr. Kang hadn’t signed any tenants.

Central Park acquired the nine-acre development site in March 2008 for nearly $8 million. Fifth Third Bank was the main lender for the proposed retail project, providing Central Park a $20.7-million construction loan and a $2.8-million line of credit.

The construction loan was to mature Sept. 6 but was extended two months, to Nov. 6, according to property records. The line of credit comes due in March. A bank spokesman declined to comment.

Central Park owes Fifth Third, its largest creditor, $10.3 million, according to the bankruptcy petition, while the CF Capital subsidiary, Catfish Glenview LLC, is owed $6.2 million.

By Andrew Schroedter

Roosevelt finances proposed Loop building

Roosevelt University has obtained financing for a 32-story building at 421-25 S. Wabash Ave. that would house classrooms, offices and housing for 600 students. The university has hired architecture firm VOA Associates Inc. for the $110-million project, which is being financed with about $184 million in bonds issued through the Illinois Finance Authority. Bond proceeds also are being used to refinance existing debt. Construction is to begin in February, and the building is slated to open in January 2012. The ambitious project has come at a cost, with two credit ratings agencies downgrading the university in part because of excessive debt. Fitch Ratings reduced its rating of the university’s debt one level to BBB+, from A-, while Moody’s Investor Service also cut its rating one level to Baa2, from Baa1.

Crain’s