New pilot program targets vacant, foreclosed properties in six Cook County communities

Gov. Quinn announcing Illinois Building Blocks Pilot Program

Representatives of the Illinois Association of REALTORS® were on hand Friday in Berwyn as Gov. Pat Quinn announced a pilot program targeting vacant and foreclosed properties in six Cook County communities.

Called the Illinois Building Blocks Pilot Program, the effort provides $40 million in Illinois Jobs Now capital funding and an additional $10 million in aid from Cook County. The money will be used to help acquire and rehabilitate property in Berwyn, Maywood, Park Forest, Riverdale, Chicago Heights and South Holland.

REALTORS® Anthony La Monica, Robert Eby and IAR President, Loretta Alonzo in Berwyn for the press conference with Gov. Pat Quinn to announce the new Building Blocks program.

Quinn also announced an effort to provide grants and other assistance for those buying vacant properties and rehabilitating them to residential use.  A third part of the plan would help existing homeowners stay out of foreclosure.

On Wednesday, Quinn announced in his State of the State speech to the Illinois General Assembly that he wanted to focus on housing issues. Shortly after the speech, his office provided details on a hotline that was being set up to assist homeowners facing foreclosure.

The Illinois Association of REALTORS® leadership and lobbyists have been in conversations with Quinn’s office since last summer about strategies to deal with the problem of foreclosures and vacant and distressed property. On hand for the announcement Friday was Loretta Alonzo, CRB, GRI, president of the Illinois Association of REALTORS® and Broker-Owner of Century 21 Alonzo & Associates in La Grange Park.

Quinn plans to hold a housing conference to examine strategies for addressing the state’s foreclosure problem March 26 in Springfield in conjunction with the Illinois Association of REALTORS®.

“Anything the state can do to help keep families in homes and keep vacant and distressed property on the tax rolls is a positive step forward, Alonzo said. “We look forward to continuing our dialogue with Gov. Quinn on how to address the state’s foreclosure problem next month at the housing conference in Springfield.”

Foreclosures are a challenge for Illinois, where there are more than 110,000 cases.  Many of those court actions are backlogged in the legal system, and that’s having a dampening effect on median home prices, said Dr. Geoffrey Hewings, director of the Regional Economics Applications Laboratory at the University of Illinois, in a report late last month for the Illinois Association of REALTORS®.

This entry was posted in Economic Development, Government Affairs, Local Issues by Jon Broadbooks. Bookmark the permalink.

About Jon Broadbooks

Jon Broadbooks is Director of Communications for the Illinois Association of REALTORS®. He supervises and carries out the implementation of the communications programs for the Association. He directs and supervises the Communications staff. He is responsible for coordinating and implementing the public relations and media relations efforts for the Association and acts as spokesperson and liaison to the statewide news media. He serves as editor of online and print content for IAR communications including the Illinois REALTOR® magazine and e-newsletters. He conducts IAR spokesperson training seminars and oversees the operation of website development for the Association.

6 thoughts on “New pilot program targets vacant, foreclosed properties in six Cook County communities

  1. Young buyers that I have shown properties to are very reluctant to even look at a short sale, because they feel like their kicking someone out of their home. I have buyers who only want to look at empty houses or empty rehab houses. I sold a house which closed in Jan 2012. The seller had two previous deals that fell through. There was an FHA appraisal done on the property, which came in at $180,000. The seller was an investor who had purchased, rehabbed and sold the property within six months. The buyer I represented was also getting an FHA loan. A second appraisal was required, because the house was being financed with an FHA loan and was being sold within six months of the seller’s purchase date. The second appraisal came in at $160,000 due to declining values within the last six months. The rehab work was top of the line. A third appraisal was requested and came in at $162,000. The final selling price was $162,000 Compromises were required to close this deal. The buyer went without the new air conditioning unit and had to pay closing costs and the selling agent reduced her commission. The seller took a $12,000 loss within just months of the first appraisal. These are tough times. I recent the government telling investors that they cannot sells a property within six month to a buyer using an FHA loan if the profit margin is to high in their opinion. This investor took a risk and should be rewarded for his high quality workmanship and his great efficient turn around time.

  2. Looking forward to the housing conference. Let’s hope the trial program can be extended to the entire state.

  3. With 30 years experience in Residential Design and construction. This program makes sense to me. Refurbishing vacant properties, especially with new Buyers contributing sweat equity can be accomplished very economically and will go a long way towards beginning to build value back into these neighborhoods. As a licensed Illinois Realtor, architect, and builder I can say this is the right way to begin turning things around. Anyone seeking help in acquiring, estimating, designing, permitting, or building under this program can feel free to contact me at lairdu@comcast.net

  4. When is the spending going to stop? Government has no business being in the real estate business and competing against private enterprise. How is a private investor supposed to compete with the government?

    I’m a real estate appraiser and broker who sells occasionally. I have an investor who is extremely worried that his rental properties are going to have to eventually compete against rental properties owned by the government.

    It’s just an endless cycle of the government encouraging people who have no business buying a house to buy something that requires financial assistance in order to quality.

  5. All very valid points indeed. Yes, Gov’t got involved in real estate for VOTES going back oh.. 10+ years ago and that didn’t work out so well as we now know.

    So why is the Gov’t involved now?.. Well, again, for VOTES, … but they also need someone, ANYONE, to pay the darn taxes on these properties.

    But aren’t banks (the owners) covering the tax bill?… um, yes, with bailout money.

    But banks aren’t lending so that means banks aren’t really making any money (interest) to pay property taxes with.. yup.. you’re getting warmer…

    So the Fed prints money and ‘loans’ it to banks ‘overnight’ (every night) for the low low ‘overnight’ rate of… wait for it… ZERO %. That’s the band-aid.

    But the wound won’t heal because banks can’t grow that ‘free money’ by lending it and they can’t put it to work in the markets either (thank gawd).

    And banks can’t market their ‘inventory’ to investors because that would slam prices to the floor as only cash buyers could afford to buy. Remember there is no lending going on for these tattered properties?

    Banks are the owner now – period. They are ‘..on the hook..’ -as they say. And that means us, you and me, the tax payers ultimately pay the bill in this conundrum.

    My investors lose 19 out of 20 offers they make. They know how much to offer. They lose to guess who?… Speculators who are looking to ‘rehab’ and flip in an environment where there is NO RETAIL LENDING.

    FHA guidelines are there to … listen carefully… EXTINGUISH SPECULATION.

    So what do they do?.. as a Corporation (er um.. “Government”) to get votes AND keep banks from looking bad (as they report worse and worse earnings quarter after quarter and ‘failing’ causing… BANK RUNS.. hello Great Depression…) HELP BANKS BECOME THE LANDLORDS THEY NOW REALIZE THEY ARE.

    Yes, banks are becoming net landlords, backed by government (with YOUR income and property taxes – YES YOU ARE PAYING THE PROPERTY TAXES FOR THE BANKS).

    This will merely allow banks to keep paying the property taxes to the Gov’t, who’ll then invest those payments in programs to ‘heal’ the banks inventory. This is bad.

    There is a place for private investors here. Real investors are not flipping ANYTHING.
    Investors should lean WITH the government. Buy, rehab, hold and rent section 8 (or non-section 8).

    Home ownership is once again, lucrative. There is a rental boom on the horizon that only a blind man can’t see.

    YOUR investor’s property breaks even in less than 10 years and they have a perpetual dividend thereafter. That beats the 30 years or 15 years it used to take.

    Investors betting on property value increases AT THIS TIME are insane (and you already know the definition of insanity – so it is pretty precise here).

    Do your speculator clients a favor and tell them to buy and hold FOREVER.. and they will retire on rental income and not need some company to provide a pension or their 401(k)’s to “perform”.. This is the definition of “Investing” .. not “speculating.” If they don’t like managing property then they should factor in a management fee in their cap rates.. it’s not rocket science, in fact 99% of investors hire property management companies.

    Lenders, you can still lend to investors. They have all the money you want down in order to make your numbers work. They would love to borrow at current rates.. Comprende?

    I have respectfully requested my investors who are interested in flipping to please find a Realtor that endorses that kind of speculation – because I don’t.

    It’s not a moral thing. It’s just too much work on both sides of the deal. It’s a lot of hand-holding and trying to explain why things aren’t working out on the buy and sell side of the deal. They are simply wrong-footed in this dance. The music has changed that’s all.

    I work with INVESTORS and this is how I know what I know.. I learn from LISTENING to people who really know where to put their hard earned dollars. They finally don’t have to compete with unsophisticated buyers who have blank checks from a bank.

    These are people you listen to and you will work with FOREVER.

    The speculators will continue to lose for a long long time. Speculating is over. Some of your investors will thank you for putting your foot down instead of ‘bending over’ to take a foot up the you-know-what just to get a deal done.

    Folks, stand up for your profession and tell these speculators they are risking too much and they should take the other side of the trade. The Gov’t already has. This is not hard to see folks.

    Sincerely and with best professional regards,

    Dennis
    Real Estate Broker/ Currency Futures Trader/ Building Maintenance Company Operator.

  6. I certainly agree with the new program. One would have to ask themselves if they want to see so many homes vacant for months and years. I’m sure we all want our housing value to increase and become stable. I am a Real Estate Broker working in the Chicago and its surrounding suburbs. I have been selling real estate for over twenty five years and I have never seen the real estate market so bad. I specialize in residential, short sales and foreclosures for anyone looking for a good Realtor contact me at vanremax@yahoo.com

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