A pair of articles in Crain's today paints a rather dreary - but not entirely unexpected - picture of the Chicago home market.

Home sales fell 28 percent in the fourth quarter of 2007; at the same time, foreclosures were up 50 percent in the Windy City from 2006.

The foreclosures piece points out another interesting number: 1.64 percent of all homes in Chicago were in some stage of foreclosure, according to the data from RealtyTrac, which put Chicago at number 30 out of 100 large metros surveyed.

Okay, so this may apply only those shopping for homes outside of Chicago proper, or for those willing to hasten their hunts for new digs, but we figured it was worth reporting, so listen up.

Lennar will match the Fed's new 4.875-percent, 30-year rate through its preferred lender, Universal American Mortgage Company, on select inventory and pre-construction homes, but only through this Sunday, Feb. 10.

Additionally, Lennar will pay up to 6 percent toward closing costs. Buyers must close by Feb. 29.

Lennar's suburban developments include Arlington Reserve in Arlington Heights (pictured above), Morgan's Gate in Wood Dale, Singer Landing in Lemont, Creekside Crossing in Plainfield and Orland Park Crossing in Orland Park.

The homebuilder, of course, is also behind the construction of the 21-story Parc Huron, located at the corner of Erie St and Hudson Ave. We walk past the Parc Huron's office trailer every day (it's just a few steps from Yo's front door) and figure it's about time to check in on the high-rise's status. Stay tuned for more…

"This is exactly what TIF funds and city incentives should be used for. There’s no question. We’re talking about a blighted area [on] the verge of being redeveloped. I think the city recognized that it was important to invest in high-quality product."

-G. Benjamin Ranney, a principal with Terra Firma Co., on his firm's development in East Garfield Park.

Kedzie GreenLife, a 30-unit green development in the works at 3148 W Lake St, was recently approved to receive about $2.5 million in city funds. Look for more on the project in New Homes Magazine's March 2008 issue.

They didn't use crystal balls, but a handful of key real estate players from the Lincoln Park Builders of Chicago nonetheless sought to predict the future at a recent forecast panel. Don Debat, a columnist for New Homes Magazine, reports on their prognostications in this month's issue.

Although interest rates are extremely affordable, the fallout from the subprime mortgage crisis has caused the nation’s mortgage industry to go through a “state of siege” and that likely will last two more years, said mortgage broker David Hochberg of Townstone Financial.

“Over the last five years, the residential lending market was like the Wild West,” Hochberg said. “Now, 6-percent home-loan rates are available, but many lenders are not approving loans. No-doc loans are out, and lenders are saying that mortgage applicants with a credit score in the low-500s seeking a zero-down payment loan will be rejected.”

Read the full story in New Homes' newly redesigned February issue.

High-rise development has its winners and losers, and 2008 will certainly prove to be a watershed year for the entire building community.

For New Homes Magazine's March 2008 issue, we've begun to compile a comprehensive directory of high-rises being developed right now in the city. Along the way, however, it's become clear that - for a variety of reasons - a few of these projects aren't going to move forward as planned this year. Some are off the books entirely; others are simply in a holding pattern, waiting for the right market conditions to move forward.

Here's what we've been able to confirm lately.

• Azure Tower, 1330 S Michigan Ave - On hold until at least 2009, according to a representative with Concept Developers and Realty Group. Instead, the firm is moving forward with The Interior Furniture Company Building Lofts at 1340 S Michigan (next door to the Azure Tower site), which looks to be a luxury loft rehab.
• Aristocrat Tower, 2039 S Prairie Ave -This one is off the books entirely. However, Provence Development Group is still building Astoria Tower at 8 E 9th St.
• 541 W Cornelia Ave - Four luxury single-family homes are planned for the site, replacing a 24-story tower concept in Lakeview East.

And we're hearing rumblings about 2100, Rokas International's high-rise planned for 2100 S Indiana Ave.

The developer has been in dire straits lately, dealing with a lawsuit over unpaid contracts at Motor Row Condominiums and a canceled proposal near the Sears Tower. In the last month, things have gotten worse; the phone numbers to both the sales center and the developer's office have been disconnected, and Equity Marketing Services has confirmed that they're no longer handling pre-construction sales. Even the development's official Web site seems to be offline.

At The Mortgage Reports, local mortgage broker Dan Green tells the story of the expansion and contraction of loan availability in an easy-to-follow video. As you watch, ask yourself whether the visuals accurately convey the relative size of the prime, Alt-A and subprime markets.

According to Crain's, a courtyard conversion in Ravenswood has gone belly up after the First Bank of Highland Park filed a foreclosure suit seeking $7.2 million in unpaid financing.

The 38-unit building 4519-27 N. Paulina St. is the second Allabastro & Associates condo conversion project that’s had difficulty. A nearly completed project in Lakeview is also in foreclosure, allegedly for $730,324.

Here's our good news / bad news post of the day. Today's Wall Street Journal features a profile writeup on John Paulson, a hedge fund manager who decided to bet against the housing market at the height of the bubble.

It was a risky move, but the ensuing subprime meltdown netted some $14 billion for his clients' funds. Paulson's personal take is estimated at $3 - $4 billion, according to the article.

Mr. Paulson has tried to keep a low profile, saying he's reluctant to celebrate while housing causes others pain. He has told friends he'll increase his charitable giving. In October, he gave $15 million to the Center for Responsible Lending to fund legal assistance to families facing foreclosure. The center lobbies for a law that would let bankruptcy judges restructure some mortgages.

"While we never made a subprime loan and are not predatory lenders, we think a lot of homeowners have been victimized," Mr. Paulson says. "Bankruptcy is the best way to keep homeowners in the home without costing the government any money."

We've all seen the headlines: Springfield's pending transit solution is now wrapped up in a rather hefty increase in the state's real estate transfer tax. The bump could be as much as 40 percent, according to today's Trib article.

In a comment on a previous entry, Dmac called the move "disgraceful" and questioned why the state was heaping abuse on "part of our economy that's already taken a beating."

What do you think? Is the transfer tax bump the right choice for a reliable transit solution? Or will homebuyers respond by steering clear of a market that's already rife with deals?

How about this for an interesting headline: "Nation's biggest bank buys nation's biggest mortgage mess."

That's just what happened today, when Bank of America pledged $4 billion to bail out Countrywide Financial Corp, the beleaguered mortgage operation that's been the poster child of the subprime crisis. From the CNNMoney.com article:

The firms said they do not plan to remain in subprime lending - the business of giving home loans to borrowers with weak credit - and said they would continue to work to keep troubled borrowers in their homes.