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Chicago Housing Market 2019: Home Prices, Trends & Forecasts

Chicago Real Estate Market 2019 Statistics

If you are looking at buying a house in Chicago as a potential investment opportunity, you must read till the end. Home prices in the Chicago real estate market are predicted to rise at a steady pace throughout 2019. So you might want to consider making your purchase sooner rather than later, to avoid higher housing costs down the road.

Chicago is the third largest metropolitan area in the U.S, almost three million in Chicago and another ten million in the surrounding metro area. Chicago has a large population, diverse economy, and a stable market. It is home to 32 Fortune 500 companies. It has high private sector employment. And due to a number of factors, Chicago Real Estate Market is one of the best rental real estate markets in the US. Let’s take a close look at the Chicago housing market trends and forecasts for 2019 & 2020 and find out why you should invest in this sizzling market.

Chicago Real Estate For Sale

Chicago Real Estate Market Forecasts 2019, 2020 & 2021

The median home value in Chicago is $228,900 on Zillow. Chicago home values have gone up 0.7% over the past year and Zillow’s Chicago real estate market prediction is that the prices will rise 1.6% within the next year. The median list price per square foot in Chicago is $252, which is higher than the Chicago-Naperville-Elgin Metro average of $168. The median price of homes currently listed in Chicago is $330,000 while the median price of homes that sold is $262,400. The median rent price in Chicago is $1,715, which is higher than the Chicago-Naperville-Elgin Metro median of $1,650.

Chicago Real Estate Market Forecast

Graph Credits: Zillow.com

According to LittleBigHomes.com, the Chicago real estate market forecast for the 12 months ending with the 3rd Quarter of 2019 is positive. Their accuracy of the Chicago real estate market trend prediction is 91%. Accordingly, they estimate that the probability for rising home prices in Chicago is 91% during this period. If this Housing Market Forecast  is correct, home prices will be higher in the 3rd Quarter of 2019 than they were in the 3rd Quarter of 2018.

Chicago Housing Market Forecast 2019 – 2021

The Chicago housing market forecast for the 3 years ending with the 3rd Quarter of 2021 is also positive. The accuracy of the Chicago housing market trend prediction for Chicago is 84%. Accordingly, LittleBigHomes.com estimates that the probability for rising home prices in Chicago is 84% during this period. If this Housing Market Forecast is correct, home values will be higher in the 3rd Quarter of 2021 than they were in the 3rd Quarter of 2018.

Check this page each quarter for updates to the Chicago Real Estate Market Forecast.

Chicago Real Estate Market Trends

chicago real estate market

Chicago real estate market trends indicate a decrease of $6,500 (-3%) in median home sales and a 0% rise in median rent per month over the past year, according to Trulia.com. The average price per square foot for this same period rose to $206, up from $201. The median sales price for homes in Chicago for Jan 11 to Apr 10 was $249,000 based on 3,224 home sales. Average price per square foot for Chicago was $206, an increase of 2% compared to the same period last year. The median rent per month for apartments in Chicago for Mar 10 to Apr 10 was $1,600.

Chicago Real Estate Market Trends

Graph Credits: Trulia.com

As per the real estate company named Redfin, the Chicago housing market is somewhat competitive. Homes in Chicago receive 1 offers on average and sell in around 85 days. The average sale price of a home in Chicago was $286K last month, down 1.4% since last year. The average sale price per square foot in Chicago is $197, down 2.0% since last year. Homes typically receive 1 offer. Homes in the Chicago housing market sell for about 3% below list price and go pending in around 85 days. Hot Homes for sale in Chicago, IL can sell for around list price and go pending in around 37 days.

Chicago Housing Market Statistics

  • Median Sales Price: $249,000 (On Trulia)
  • Price Per Square Ft: $206
  • Median Rent Per Month: $1,600
  • Median Household Income: $44,649
  • Home Owners: 45%
  • Single Residents: 37%
  • Median Age: 34
  • College Educated: 29%
  • Transportation: 67% people commute by car; public transport is available

There are 18,417 homes for sale in Chicago, IL, ranging from $1 to $45M on Realtor.com. 1,779 of which were newly listed within the last week. Additionally, there are 7,811 Chicago rental properties up to $42,000 per month. In February 2019 the housing market in Chicago, IL was a buyer’s market, which means there were roughly more active homes for sale than there were buyers. Buyer’s markets are generally more advantageous for buyers rather than sellers.

Chicago Housing Market Trends

Graph Credits: Realtor.com

In February 2019, the median list price of homes in Chicago, IL was $309.9K, trending up 6.9% year-over-year. The median listing price per square foot was $218. The median sale price was $260K. Homes in Chicago, IL sold for 2.3% below asking price on average in February 2019. On average, homes in Chicago, IL sell after 84 days on the market. The trend for median days on market in Chicago, IL is flat since last month, and flat since last year.

Chicago-Housing-Market-Trend

Graph Credits: Realtor.com

The median list price in Chicago is $369,900 on Movoto.com. The median list price in Chicago was less than 1% change from March to April. Chicago’s home resale inventories is 8,060, which increased 4 percent since March 2019. The median list price per square foot in Chicago is $263. March 2019 was $260. Distressed properties such as foreclosures and short sales remained the same as a percentage of the total market in April.

Chicago Real Estate Market Trend

Graph Credits – Movoto.com

Chicago Single Family And Multi-Family Homes

Following the housing market decline in 2007, single family rental homes became favorable options for investors, saving in construction or refurbishment prices. The quick turnaround for an owner to rent out their property means cash flow is almost immediate. Single family rental homes have grown up to 30% within the last three years. Almost all the housing demand in the US in recent years has been filled by single family rental units.

As per the data from the real estate company called Neigborhoodscout.comthe median house price in Chicago is $261,503, which is well above the national average. Large apartment complexes or high rise apartments are the single most common housing type in Chicago, accounting for 40.94% of the city’s housing units. Other types of housing that are prevalent in Chicago include duplexes, homes converted to apartments or other small apartment buildings ( 29.57%), single family detached homes ( 25.86%), and a few row houses and other attached homes ( 3.42%).

This particular housing mix is relatively uncommon and characteristic of cities that are compact and walkable, and which often have a lively downtown. People in Chicago primarily live in small (one, two or no bedroom) units, chiefly found in large apartment complexes or high rise apartments. Chicago has a mixture of owner-occupied and renter-occupied housing. Currently, there are 6,305 single family homes for sale in Chicago, IL on Zillow. These include upcoming potential listings. Additionally, there are 412 single family homes for rent in Chicago, IL.

Chicago, IL Foreclosures And Bank Owned Homes

The percent of delinquent mortgages in Chicago is 1.3%, which is higher than the national value of 1.1%, according to Zillow. With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth. The percent of Chicago homeowners underwater on their mortgage is 21.4%, which is higher than Chicago-Naperville-Elgin Metro at 13.5%.

  • Foreclosures in Chicago = 5,892 (RealtyTrac)
  • Homes for Sale in Chicago = 6,056
  • Recently Sold = 2,084
  • Median List Price = $299,900 (9% ⇑ vs Feb 2018)

There are currently 5,892 properties in Chicago, IL that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 6,056. In March 2019, the number of properties that received a foreclosure filing in Chicago, IL was 7% lower than the previous month and 35% lower than the same time last year.

Home sales for February 2019 were up 0% compared with the previous month, and down 100% compared with a year ago. The median sales price of a non-distressed home in Chicago, IL was $0. The median sales price of a foreclosure home in Chicago, IL was $0, or 0% higher than non-distressed home sales.

Chicago Home Prices And Real Estate Appreciation

The average annual home appreciation rate in Chicago during the period has been just -0.05%, which is lower than 80% of US communities. Over the last year, Chicago real estate appreciation rates have trailed the rest of the nation. In the last twelve months, Chicago’s real estate appreciation rate has been 4.99%, which is lower than appreciation rates in most communities in the U.S. In the latest quarter, the real estate appreciation rates in Chicago were at 1.09%, which equates to an annual appreciation rate of 4.42%.

The above statistics on real estate appreciation in Chicago were taken from NeighborhoodScout.com. You can visit their page for more information. Relative to Illinois, our data show that Chicago’s latest annual real estate appreciation rate is higher than 70% of the other cities and towns in Illinois.

10 Best Neighborhoods In Chicago For Real Estate Investment

There are 1,715 schools in Chicago, IL. There are 565 elementary schools, 509 middle schools, 195 high schools and 446 private & charter schools. There are 81 neighborhoods in Chicago. Lincoln Park has a median listing price of $749,000, making it the most expensive neighborhood. Roseland is the most affordable neighborhood in Chicago, with a median listing price of $125,000.

These are the 10 best neighborhoods in Chicago to invest in real estate because they have the highest real estate appreciation rates (List by Neigborhoodscout.com).

Should You Buy Chicago Investment Properties?

Investing in real estate is touted as a great way to become wealthy. Planning to invest in the Chicago real estate market? Many real estate investors have asked themselves if buying a property in Chicago is a good investment? You need to drill deeper into local trends if you want to know what the market holds for the year ahead.

We have already discussed the Chicago housing market forecast for answers on why to put resources into this sizzling market in 2019. The Chicago home prices are expected to rise by 1.6% in 2020.  So you should consider investing in Chicago investment properties sooner, to avoid higher home prices down the road. Here are the ten well-researched reasons for you to invest in the Chicago real estate in 2019.

1. Rental Demand In Chicago Is High And So Are Rents

What makes Chicago such a hot market for rental real estate? Over 50% of the population rents. The large population of renters means that rental income for properties is far better than you’d see if you invested elsewhere in the country. Schaumberg reported slowing sales simply due to tight supply according due to data from the Chicago Association of Realtors; this drives many people forming new households or moving into the area to rent at whatever the market will bear.

2. Luxury Rentals Are a Profitable Niche in Chicago

Many people know that there are solid blue-collar areas with high rents, but it isn’t just the working class that rents townhomes and condos. According to Crain’s, the number of upper income households in Cook County that rent has nearly doubled over the past ten years. The Institute for Housing Studies at DePaul University found that the number of rental households among those earning at least $132,000 a year nearly doubled, while those earning $80,000 to $132,000 saw the number of renting households increase by just over 50%. Chicago has a booming supply of high end rentals, especially luxury apartments in downtown.

3. Chicago Home Prices Are Reasonable

Because households at all income levels choose to rent instead of buy, they are reducing demand for houses for sale, slowing the rise in home prices. This also explains why housing prices haven’t skyrocketed despite limited supply. Chicago’s inventory of homes for sale is very tight. Both attached and detached single family home inventory has been declining since 2012.

At the end of 2017, potential buyers in Chicago had about five thousand fewer properties on the market to select from than if they’d been shopping at the end of 2016. This contributed to homes closing five days faster than the year before. If you start shopping for rental real estate, you could find something and rent it out.

4. Chicago Home Prices Are Appreciating

Chicago’s real estate market has been one of the slowest to recover since the housing bubble burst at the start of the Great Recession. Home prices were 19% below their pre-crash levels in 2017, and they aren’t expected to hit peak values until 2020. This means that the Chicago real estate market is likely going to continue its slow, upward market trend. Trulia expects prices to grow about 2.5% in 2018. Trends in Chicago show a 1% year-over-year rise in median sales price and a 3% rise in median rent per month.

5. Rehabbed Homes Are Readily Available

Chicago is seeing a surge in fully renovated single family homes. The Chicago Association of Realtors’ data found that most of the strong suburbs are on the south side of Chicago, and this is where many homes are being rehabbed and sold. Calumet Heights is in this category; a quarter of properties sold were either rehabbed or candidates for rehabilitation. These properties are ideal for investors who want to buy a property to rent out.

6. Job Growth Keeps People Coming

Chicago is not only home to a number of corporate headquarters; there has been a recent trend of companies moving their headquarters to Chicago as well. The steady increase in jobs has contributed to a slow but steady increase in rents. Many businesses are attracted by Chicago’s labor pool, the largest in the nation. As these businesses move into the area and attract relocating professionals, many are forced to rent because they can’t find houses fast enough in the areas they want to live or simply choose to rent upon relocation in one of the luxury apartments downtown.

7. Churn Keeps People Renting

Chicago’s unemployment rate has gone up while dropping in other cities as jobs shift from Chicago to the suburbs. This economic uncertainty keeps many who can afford to buy a home renting. It also keeps the rental market itself strong, since many want to remain free to follow their jobs as required.

8. Trump’s Tax Plan Makes Many Reluctant to Buy – Unless It Is a Rental

Uncertainty about the deductibility of hefty property tax bills is making many reluctant to buy a home, though this is less of an issue for a real estate investor who will rent out the property. Chicago and its suburbs have some of the highest property taxes in the nations. Around 12% of Chicago area homes have a tax bill of more than $10,000 a year. Yet that’s better than some of the most expensive real estate markets in the country.

For example, in New York, more than 20% of homes have a property tax bill that high. In Orange County, California, more than half would. This means that limits or the loss of property tax deductions won’t hurt Chicago as badly as it would California or New York, and if it does have an impact, it will mostly be at the higher end of the Chicago real estate market.

9. You Can Find Hot Single Family Markets with Rapid Appreciation

Home prices in the Chicago area are low compared to regional income. Yet economic uncertainty and shifts in the employment market are leaving many who want to live in a single family home unable to afford to buy one. This is causing many to rent single family homes instead. Crain’s April real estate report found that the hottest markets for detached single family homes were in Calumet Heights, Gage Park and West Ridge. However, home prices are low compared to rents almost everywhere in the Chicago metropolitan area.

10. There Are Opportunities in Chicago Multi-Family Housing, Too

The workforce in Chicago is shifting from high paying but slow-to-no growth manufacturing jobs to lower paying and less stable retail, business services and healthcare jobs. This is causing many who would have been able to afford a middle class home to rent apartments instead. Crain’s April real estate report stated that the hottest Chicago markets for condos and townhomes were Grand Boulevard, Kenwood and Lincoln Square.

Chicago Real Estate Investment

Maybe you have done a bit of real estate investing in Chicago, IL but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. If you invest wisely, you could secure your future. If you are a beginner in the business of cash flow real estate investing, it very important to read good books on real estate.

Most investors naturally gravitate to residential property investment. When looking for the best real estate investments, you should focus on markets with relatively high population and employment growth. Both of them translate into high demand for housing. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable.

You must also collaborate and learn from savvy real estate investors who have retired early on in their lives by investing in some of the best real estate markets like Chicago, IL. In Chicago, arts and culture abound at top institutions like The Art Institute. Although the winters can test anyone’s resolve, Chicago summers are among the best in the world, with things to do every weekend, outdoor festivals, and Lake Michigan at your doorstep.

Chicago has an incredibly deep pool of potential renters at all levels of the market. A number of factors guarantee that they’re not going to turn into new home buyers any time soon. Chicago real estate market is a prime market for investors who would like to buy where the ROI is going to be high and likely to improve over time. It won’t be long before Chicago makes you feel right at home.

Chicago Investment Properties For Sale ⇐ Click Here

Buying an investment property is different from buying an owner-occupied home. Our Chicago investment properties are designed to make money as rentals, which means you must look at it solely as an income producing entity just like any other business. These are “Turnkey Cash Flow Investment Properties” located in some of the best neighborhoods of Chicago.

Whether you are a beginner or a seasoned pro you probably realize the most important factor that will determine your success as a Real Estate Investor is your ability to find great real estate investments.

According to real estate experts, buying in a market with increasing prices, low interest, and low availability requires a different approach than buying in a cooler market.

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Here Are Some Other Markets To Invest In Real Estate In 2019

Apart from the Chicago real estate market, you can also invest in the housing market of Minneapolis, MN. Minneapolis offers an ideal mix of a strong job market, affordable real estate, large rental market and limited housing supply. These factors will drive up property values and rental rates growing at a healthy clip for years.

The Minneapolis real estate market is affordable compared to a number of booming rental markets across the country. However, the fact remains that the rental market in Minneapolis is growing.

Many would-be home buyers cannot afford to buy their first home, so they have to rent. Students who stay to work compete with economic migrants and the children of locals. Compounding the matter are the Millennials who watched parents lose homes in the 2007 housing bust and choose to rent though they could afford a home.

Houses in Minnesota face an average 1.19% property tax rate. This is very close to the national average of 1.21%. Wisconsin’s tax rate is in this same range, but their higher average property values mean they pay far more in property taxes than those in the cheaper Minneapolis real estate market.

Another hot market to choose is the Austin houing market 2019. With Austin, Texas, becoming a more diverse city every year, there are plenty of opportunities to take advantage of – from buying  new homes to different investing options in the Austin real estate market. Austin is a leader across the country with jobs and when you combine that with home prices not as drastically increasing, you’ll get a real estate market that many others envy.

Homes in Austin are 23% cheaper than the national average. It may be the second most expensive housing market in the state with a median home price of around $350,000, but it is still far cheaper than California or New York. Buy up condos or townhomes, and you’ll be able to see a sizable return on the investment.

For example, studio apartments rent for around $780 in Austin versus the $700 national average, while an Austin 1 bedroom apartment rents for almost a $1000 though the national average is $825 a month. A three bedroom apartment in Austin rents for $1500-$1600 while the national average is closer to $1400 a month.

Let us know which real estate markets you consider best for real estate investing! If you need an expert investment advise, you may fill up the form given here. 

One of our investment specialists will get in touch with you to discuss all facets of searching for, buying, and owning a turnkey investment property.


*Remember, caveat emptor still applies when buying a property anywhere. The information contained in this article was pulled from third party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.

REFERENCES:

Crain’s April real estate report
http://www.chicagobusiness.com/realestate/20180419/CRED0701/180419837/heres-where-the-real-estate-market-has-been-hottest-in-2018

Upper household rental rates
http://www.chicagobusiness.com/realestate/20180411/CRED0701/180419970/more-upper-income-households-renting-in-chicago-area

Housing inventory numbers
http://www.chicagonow.com/getting-real/2018/04/chicago-real-estate-market-worst-home-sales-decline-in-20-months/

2016 to 2017 housing inventory decline data
http://www.chicagotribune.com/business/ct-biz-chicago-home-sales-supply-20180124-story.html

Home price appreciation data
https://www.biggerpockets.com/blogs/1781/67452-chicago-real-estate-investing-forecast-for-2018

Labor pool stats                                                                                                              https://www.homeunion.com/real-estate-investment-locations/chicago-illinois/

Trulia price appreciation data
http://www.chicagobusiness.com/realestate/20171221/CRED0701/171229976/2018-real-estate-forecast-foggy-lukewarm

Trump’s Tax Plan Makes Many Reluctant to Buy
http://www.chicagobusiness.com/realestate/20171221/CRED0701/171229976/2018-real-estate-forecast-foggy-lukewarm

Workforce shift from high wage manufacturing to retail driving demand for apartments and rented single family homes
https://www.forbes.com/sites/ingowinzer/2016/05/25/should-you-invest-in-chicago-real-estate/#64c07e3c2ad1

Market Data, Trends and Statistics                                                                                  https://www.zillow.com/chicago-il/home-values                                                    https://www.littlebighomes.com/real-estate-chicago.html                          https://www.trulia.com/real_estate/Chicago-Illinois                  https://www.redfin.com/city/29470/IL/Chicago/housing-market              https://www.realtor.com/realestateandhomes-search/Chicago_IL/overview              https://www.movoto.com/chicago-il/market-trends                        https://www.realtytrac.com/statsandtrends/il/cook-county/chicago


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