flat screen televisions

Flat screen televisions. Vacation packages. Cold, hard cash. These are just some of the incentives being offered with home sales across Chicago. And they may sound like music to a home buyer’s ears, but the picture does not look as rosy for the overall housing market.

A Commerce Department report revealed that the median price of a new home sold in September dropped by 9.7 percent, the largest decrease in 35 years. But that did not include the incentives many sellers are offering that can add thousands of dollars to the final deal.

“It offsets a slumping housing market,” said Scott Peterson, owner of Peterson Appraisal Service, Inc. and Smart Realty Consultants in Chicago.

Appraisal experts, like Peterson, say that incentives added when a home sells does not reflect the true value of the home. When potential buyers come into a market and see that a house sold for $500,000, they do not know that the seller may have offered something extra, such as $10,000 in mortgage payments, to the buyers.

In turn, the potential buyers may make an offer on another house in the area based on these inflated values and end up overpaying.

But it is all buyers, including the ones taking sellers up on the incentive offers, that may be getting duped in the deal. Incentives may just be a flashy way to for home builders and sellers to avoid decreasing the listing price of a home.

And builders are offering these incentives at increasing levels. The National Association of Home Builders reported that 55 percent of home builders in the U.S. are offering incentives, up from 37 percent a year ago.

Peterson said he has seen sellers include a year’s worth of condo assessments, vacations and even cars as incentives. He said he has also seen real estate agents being offered bonuses and increased commissions.

“It will be a little cheaper for the seller to include an incentive (worth $20,000),” Peterson said. “To sell the house (without the incentive), they would have to reduce the price maybe 30 or 40 grand.”

In lieu of incentives, Certified Residential Appraiser Michael Walsh of Citywide Services in Chicago said buyers would be better off trying to get sellers to reduce the price.

“This is probably a good opportunity to negotiate lower prices on existing homes because things have slowed down,” Walsh said.

He said sellers often use incentives just to make a house look more attractive.

“People like something for nothing; but there is nothing for nothing,” Walsh said.

Walsh and Peterson both said sellers in Chicago have not been as desperate as some in other areas that have an abundance of property on the market waiting to be sold.

Walsh said that speculators, who went to areas like Miami looking to flip property when the market was hot, are vanishing and now trying to sell their property.

“In places like Florida, some builders are just breaking even and buyers are going to do really well,” Walsh said.

Although Chicago did not experience that kind of speculation, Peterson said he has seen some of the effects of it here in the city.

“Out of town brokers in resort communities are offering Chicago brokers large incentives for referrals of buyers who are looking to buy vacation homes,” Peterson said.

Wicker Park hipsters: Get ready to check "grunge" at the door.

The swanky new Debonair Social Club, 1575 N. Milwaukee Ave., officially opened Friday at 6 p.m.

Debonair is one of several new bars and clubs opening this winter in the arty-yet increasingly gentrified-Wicker Park area.

"Our goal is to add onto the growing reputation that Wicker Park has become known for: as the art, fashion, food and entertainment destination in the city," General Manager Steve Harris said in an October press release.

Harris will be operating the club with a team of three others: Vincent Haycock, artist director; Claudia Gassel, image marketer; and Matthew Murray, bartender (dubbed "startender").

Debonair hopes to attract both hipsters and jetsetters alike by gussying up the local art and music scene. The club occupies a space in the historic Flat Iron building, home to many budding artists and galleries. The upper level features sleek, monochromatic decor with a color-changing light screen illuminating the dance floor, an area that doubles as a stage for live music acts. Six flat-screen televisions play thematic, independent films assembled by Emmy-nominated Haycock. The darkly lit lower level is rimmed with LED lighting and includes a second DJ and 30-foot bar.

The club also offers a sophisticated Italian-American menu for dinner and late-night snacking.

"Debonair is a beautifully designed showcase for not only the culture displayed within but the community of the social club," Gassel said in the press release.
For some residents, however, the mere title of the club is cause for concern.

"It sounds gentleman-oriented," said Kristin Reger, 22, a Wicker Park artist. "[That] is going to make a woman not want to go there."

Publicist Julie Darling said in the press release that while the title of the club may "evoke a wise guy hangout," the space is intended to exude "a modern edge that is gal-friendly" and that "playfully [addresses] the historic aspects of the social club-sophistication with a hint of debauchery."

To help cultivate that "modern edge," Debonair's windows are painted almost entirely black, with only small strips of clear glass allowing passersby to peek inside.

Reger said she found the dark exterior "a little daunting." Another resident, barista Stevie Rox, 22, said that in her experience, young Wicker Park bar-goers "really don't care" about the aesthetics of their watering-holes and are more concerned with the cost of drinks and with how late the clubs are open. Additionally, Debonair's dark windows and lack of signage have led several residents to comment that they hadn't even noticed it.

However, Reger added she would "probably stop in" at some point and indicated that if "the art is authentic" and the managers "are serious" about delving into Wicker Park's art and music scene, people will flock to the club.

"It sounded like a good addition to the neighborhood," agreed Ila Englof, 24, a medical school student. "It fits in with the whole art scene and it's very hip and up-and-coming. I wanted to check it out at some point."

Debonair Social Club will be open Tuesday through Saturday from 6 p.m. to 2 a.m. and for Sunday brunch from 12 to 6 p.m.