The Truth About Chicago South Real Estate
What is Really Happening in Chicago South Real Estate?
What is the real truth about Chicago South real estate market? For Chicago as a whole, property values are almost recovered to levels reached 10 years ago. This is great news. There has been a boom in the downtown areas as well as those areas helped by investor activity. There has been a lot of development particularly in the areas near downtown as companies have relocated here and others have increased hiring. There has also been an increase in demand as Chicago has improved on amenities like the new Riverwalk, the 606 Trail on the near north side, a hotel boom downtown, etc. There are definitely some issues in Chicago but overall real estate is thriving.
The median sales price for the city of Chicago was $307,750 in April 2018. There continues to be growth in the sales price for Chicago overall. In addition to commercial development, this is partly due to a strong seller’s market and a decline in foreclosures for the past three years. There has also been a crazy amount of investor activity. Local investors as well as those in other states and overseas have taken advantage of depressed property values here. This investor activity has been largely a benefit in many communities where market values have seen a significant improvement with these “flipped” homes.
Chicago South Side
However, the news is mixed in some areas of Chicagoland. What’s going on in Chicago’s south side neighborhoods and Chicago’s south/southwest suburbs? For the southside, the sales price was $178,500 in April. For some Chicago southside neighborhoods, things are going well. The South Loop, Bridgeport, Hyde Park, Morgan Park, Bronzeville, Pilsen, Beverly and Ashburn (as well as others) are doing well. Downtown development, strong investor activity and strong buyer appeal for the neighborhood has helped these areas recover and do well. Other neighborhoods which were hit harder with foreclosures are recovering much slower. In some of these neighborhoods, investor activity has helped a lot but foreclosures are still a significant problem. The median sales price for foreclosures sold on the south side was $53,300 in April representing 11.5% of homes sold.
Chicago South Suburbs
For the south/southwest suburbs, the median sales price for single family homes was $159,700 in April. Prices have improved as in Chicago but values are also still impacted by foreclosures. There is also not as much investor activity in the south suburbs as there is in the city. The investor activity in some communities in the south suburbs has been on the rental side vs flipping the property for higher prices. The result of this is that those communities don’t have the increase in market values because closed transactions still reflect the foreclosed purchase price on the rental homes. Foreclosure activity in the south/southwest suburbs is almost completely in south Cook county.
The other issue impacting real estate in south Cook county are high property taxes. I’ve seen very nice rehabbed homes that have a ceiling on price because of the high property taxes. This does not help the recovery in property values. For the city, high property taxes are not really an issue.
The Good News
The good news in Chicago South real estate is that you can get more home for your dollars than other communities in the Chicago market. If you want a condo with proximity or easy access to downtown, you’ll pay a lot less in neighborhoods like Bridgeport, Bronzeville, or Hyde Park than you will in the immediate Loop areas (and get a really nice home). If you want a nice detached home, the prices are also more attractive. The same goes for the south/southwest suburbs compared to other suburban communities in the Chicago area market. In addition, housing supply in many of these communities is not as tight as other communities.
For sellers, the news is great in that you will get more than you would have a few years ago. We have a seller’s market in many communities and neighborhoods so prices have grown. The supply of homes is also tight in comparison to buyer demand so market time is shorter and a lot fewer homes on the market remain unsold. There is also good news in that the home you buy after the sale may be more affordable. This may be a good time to move up into a bigger home or a community with better school districts. If you are deciding whether it is a good time for you to sell, you should start with getting a market value analysis for your home and an estimation of your net proceeds.
Click here for a report with market stats for each Chicago neighborhood and suburban community. For the report with just condos and townhomes, click here. If you have any questions, please feel free to contact me. I specialize in the Chicago South real estate market.
If you are looking to buy or sell in the Chicago south real estate market, I would love to work with you. Give me a call so we can discuss.