The Best Incentives We've Found in Chicago

Here are some of the best discount-deals we've found in the city:

Dubin Residential has three townhomes left for sale at The Wabash Club, 2390 S. Wabash Ave., and is now offering discounts of as much as $25,000 or financing up to 1 percent lower than prevailing interest rates. The homes, which are available immediately, have two bedrooms, dens, media rooms, attached two-car garages and balconies. Before the discounts, the townhomes cost from $429,900 to $584,788. Dubin is offering similar discounts – price cuts of up to $10,000 or special financing – on the remaining homes at its Monroe Place, Welbourn Row and Kilbourn Court developments.

RDM Development is offering a $10,000 price cut to the first 10 buyers of high-rise units at Trio, 650 W. Wayman St., in 2007. The discounted one- and two-bedrooms condos are priced from the $230s to the $450s.

In response to what Britta Rivera, vice president of sales for Lennar Chicago – Urban, calls the "nonexistent" fall market—as well as competition from other South Loop developers—Lennar is offering a $10,000 discount on all units at Library Tower, 511 S. Plymouth Court.

The Library Tower condos have one to three bedrooms and are priced from the $340s to the $880s. The Library Tower deal was still available in mid-February, but Rivera said that the development could sell out sometime in spring. Lennar is also making discounts of $10,000 to $20,000, as well as free parking, available on select two-bedroom units at its Parc Chestnut condo mid-rise, 849 N. Franklin St.

Special Financing

To take advantage of Lennar's discounts at Library Tower and Parc Chestnut, buyers must secure mortgages with a lender that is a subsidiary of the developer's parent company, Lennar Corporation. It’s common to see that sort of reward for using a preferred lender in today's market. But when builders offer such loan programs, you'll definitely want to weigh the value of the incentive against the better interest rate you might find elsewhere.

Many developer financing programs are written to give buyers lower interest rates in the short-term and then adjust to higher fixed rates after a specified period. Buyers looking for 30-year fixed-rate loans can take advantage of this sort of program, called a "buy-down," at Anchor General’s Cornelia Court townhomes, 3002 W. Cornelia Ave. The buy-down lets home-buyers lock into a rate 1 percent below market for two years, then raises the rate by 1 percent to a fixed rate for the remainder of the loan's life.

In January, the program offered an initial rate of 5.25 percent, which bumps up to 6.25 percent in two years (as with many of the deals described in this article, those numbers may have changed since this piece was posted). Gale Goldstick of Coldwell Banker Residential Brokerage says that the deal is valued at about $6,000 over two years. At the time this article was written, the program was being offered through April 1.

Both Catalpa Gardens in Edgewater and Lincoln Center in Lincoln Square are offering condo buyers similar 2-1 mortgage buy-downs. The terms vary, but homeowners who choose the buy-down programs at these developments pay below-market interest rates for two years.

Some developers are also offering breaks on closing costs, assessments, and upgrades. These can take the form of delayed payments – six months to a year of no monthly assessments – or credits to be used in the design center, or even money to pay attorneys' fees and other costs.

Sutherland Pearsall Development Corporation is offering cash toward closing costs amounting to 1 percent of the home’s price for buyers who purchase before March 31 at eight South Side developments, including Boulevard Townhomes, 3993 S. Drexel Blvd., and Drexel Place Condominiums, 4127 S. Drexel Blvd. This offer also includes free 50-inch plasma TVs.

The developer of Van Buren Lofts at 1224 W. Van Buren St., is also offering to pay closing costs as part of two incentive packages. In addition, buyers can choose from $3,500 in upgrades and a new washer and dryer, a year without assessments, or no-down-payment financing with eight months of no mortgage payments (if the purchaser has good credit).

Deals on closing costs and assessments might not seem to match up against the price cuts and free parking spaces at other developments, but they can make a huge difference to first-timers who are struggling to put together a down payment or are trying to buy without one. Not having to make monthly payments that might have totaled $2,000 to more than $4,000 during that difficult first year can seem like a godsend to financially strapped buyers.

Projects that were offering buyers a year free of assessments at the time of publication include Chess Lofts, 320 E. 21st St.; The Flats on LaSalle, 1140 N. LaSalle St.; and Michigan Avenue Tower II, 1400 S. Michigan Ave.

NEXT: More Great Chicago Condo Upgrades and Incentives