The Biggest Story of 2018: Will the Apartment Bubble Burst?

During 2017, we chattered extensively about the number of new rental high rises going up downtown.

But new apartments were also being built in mid-rise buildings throughout the city. Some neighborhoods welcomed the investments, but others, like Logan Square, actually protested the construction of these expensive, luxury apartments.

And now, despite reassurance from developers that there is plenty of demand, there appears to be an apartment glut, with several new mega-buildings yet to be completed.

Over the next 3 years, over 13,000 apartments are expected to come on the market downtown, 46% over the absorption rate.

We’ve chattered before as to what this will mean for tenants.

Already, landlords are offering at least 2 months free plus other “perks” such as free parking, free cable packages and even gift cards to furniture stores.

Yet, construction isn’t slowing down, as Crain’s reported in December.

Another construction crane is about to rise in the Fulton Market District after a local developer secured financing for a 263-unit apartment project on the neighborhood’s west end.

Marquette plans to break ground Jan. 8 on the 14-story building at the southwest corner of Lake and Ada streets, said Marquette President Darren Sloniger. It’s one of several residential projects in the works in the Fulton Market area, one of the hottest neighborhoods in Chicago, punctuated by the arrival of McDonald’s headquarters there next year.

Apartment developers like Naperville-based Marquette are counting on job growth—McDonald’s is moving about 2,000 employees there next year—to drive demand for housing. Unlike other parts of downtown Chicago, which are overbuilt, Sloniger said Fulton Market doesn’t have enough apartments to satisfy the strong demand there, one reason he’s confident Marquette will be able to fill up its new apartment building.

“It’s more supply constrained,” he said of the neighborhood.

But several other developers have the same idea, meaning that supply could catch up with demand in the next few years. Developers have rolled out plans for more than 2,000 apartments in the broader Fulton Market neighborhood, including a 300-unit tower at Peoria and Randolph streets. Of course, there’s no guarantee that all the developers will obtain construction financing, a task that has grown more difficult as construction costs have risen and the downtown market has swelled with thousands of new apartments.

“It’s tough to get deals done,” Sloniger said.

Will the building spree finally halt in 2018?

And will we ever see some of these apartment buildings convert into condos?


Second Biggest Story of 2018: Will There Be a Luxury Condominium Glut?

Construction continues on luxury housing in Chicago, with several new luxury condominium buildings announced last year.

There are so many, I can’t even keep up with them while they are under construction.

Curbed recently put together a nice list of 47 buildings over 100 feet that are under construction in Chicago (these are not all condo buildings). But it shows you the extent of the building.

They range from a 14 story luxury tower at Huron and Dearborn to the 94 story Vista Tower on Wacker Drive in Lakeshore East.

Here are a few of the developments:

  1. One Bennett Place at 451 E. Grand: 69 stories with 400 apartments and 100 luxury condominiums currently under construction. I haven’t found any recent update on condo sales.
  2. Vista Tower at 363 E. Wacker Drive: tallest of the three towers is 94 stories. According to Curbed, as of November 21, 2017, the developer said 40% of the 406 condominiums were under contract. These are priced from $1 to $18 million. It will also have a 200 room hotel.
  3. 56 W. Huron: 10 full floor residences and one duplex penthouse priced from $1.375 million to $3.99 million for the penthouse. This building is now under construction. The building’s website indicates that 2 of the units have been sold. You can see all the details here.

There are plenty more.

Most of these condo units aren’t listed on the MLS so they’re not showing up as inventory even though the buildings are under construction.

Luxury housing has always done well when the stock market is hitting new all time highs.

Is there truly demand to meet all this supply?

Or will buyers be able to pick up some bargains later in 2018?

Third Biggest Story of 2018: Will Chicago Win Amazon HQ2?

Decision day is fast approaching as to where Amazon will build its second headquarters.

If you recall, 238 cities sent in proposals.

The decision is expected in early 2018 as Amazon’s Seattle headquarters is bursting at the seams. It appears they are looking to start construction at the new location ASAP.

Amazon will spend $5 billion to build out its headquarters and expects to ultimately hire as many as 50,000 people.

It wanted an urban area in a city with over 1 million people. Amazon also wanted an international airport.

While many cities are drooling at the prospect of landing HQ2, there are also cons to “winning” this beauty contest, especially in real estate.

From CNNMoney:

New research from Apartment List, a site that catalogs apartment rentals across the country, forecasts an annual rent increase of up to 2% per year in the city that houses HQ2. That’s on top of organic price increases that already occur from year to year.

“Rents are already rising rapidly nationwide,” Apartment List said in a report that analyzed data from the U.S. Census and Bureau of Labor Statistics. Half of renters are considered “cost burdened,” spending 30 percent or more of their income on rent, according to the firm.

Apartment List said Raleigh, Pittsburgh and San Jose would experience the highest rent increases if HQ2 comes to town. The impact would be smaller in cities like Washington D.C., Los Angeles and Dallas.

The largest increase in housing costs would be in Raleigh, which wouldn’t be able to build enough homes to sustain the influx of workers, according to the report. Meanwhile, housing costs would stay lower in places like Dallas, which has lax building restrictions and a cheaper labor pool.

In 2017, Seattle easily took the crown as the city with the most construction cranes with 58.

Housing prices also jumped the most of any of the top 20 major cities last year.

The Seattle median home price:

  • To start 2017: $635,000
  • End of 2017: $741,000

Of course, median price is also dicey as it depends on the mix. But inventory is low in Seattle as thousands more are moving in than there is housing for.

Stories of bidding wars abound.

Will Chicago win Amazon HQ2?

Can Chicago’s housing market handle winning?



Market Conditions: Despite Seasonal Slowdown, November Still Second Best in 10 Years

State Street at Christmas 2011

The Illinois Association of Realtors is out with November’s home sales.

As predicted, things slowed in the historically slow time of the year.

The housing market just feels pretty “blah” right now- doesn’t it?

From the IAR:

The city of Chicago saw year-over-year home sales decline slightly in November 2017 with 1,923 sales, compared to 1,937 in November 2016. The median price of a home in the city of Chicago in November 2017 was $259,500, down 0.2 percent compared to November 2016 when it was $260,000.

Here is the November sales data for the last 9 years (thanks to G for some of the data):

  • November 2007: 1859 sales and median price of $290,000
  • November 2008: 1093 sales and median price of $222,500 (16% short/REO sales)
  • November 2009: 1905 sales and median price of $215,000 (29% short/REO sales)
  • November 2010: 1144 sales and median price of $182,500 (39% short/REO sales)
  • November 2011: 1429 sales and median price of $157,000 (43% short/REO sales)
  • November 2012: 1750 sales and median price of $180,000
  • November 2013: 1844 sales and median price of $200,000
  • November 2014: 1638 sales and median price of $230,000
  • November 2015: 1661 sales and median price of $233,500
  • November 2016: 1937 sales and median price of $260,000
  • November 2017: 1923 sales and median price of $259,500

Last year was a ten year high in November sales. This year wasn’t far behind.

“Today’s numbers are reflective of both the seasonality of the market and the lack of clarity on the potential impact of tax reform,” said Rebecca Thomson, president of the Chicago Association of REALTORS® and Vice President of Agent Development at @properties. “Sales prices seemingly stabilized in November, despite slight declines in inventory and market time, which reflects that pricing and demand are starting to level out, a trend that will likely continue into the new year.”

Average market time statewide fell to 58 days from 62 days a year ago.

Additionally, statewide inventory declined 12% to 52,819 from 60,005.

Mortgage rates continue to be favorable for home buyers. The 30-year fixed rate mortgage averaged 3.9% in the month of November versus 3.77% in November 2016.

“The market is experiencing what appears to be a pretty typical seasonal slowdown in many areas of the state,” said Illinois REALTORS® President Matt Difanis, ABR, CIPS, GRI, broker-owner of RE/MAX Realty Associates in Champaign. “Illinois is poised to end the year in positive sales and median price territory, and the final quarter of 2017 should provide a steady push into the new year as more properties come onto the market after the holidays.”

Is there any indication that market conditions will change heading into 2018?

Should homebuyers expect another competitive, bidding war type of market?

Illinois home prices increase in November; Sales hold steady [Illinois Association of Realtors, Press Release, December 20, 2017]

What Will Happen to $10 Million+ Single Family Homes in 2018? 924 N. Clark in the Gold Coast

This 6-bedroom home at 924 N. Clark in the Gold Coast has been on and off the market since April 2015. (Sorry- I don’t have a good picture of this house.)

It’s been written up by the media because at one point in 2015 it was listed for $15 million, which puts it among the most expensive single family homes for sale in Chicago or the Chicagoland area.

Built on an extra large 51×151 lot, it has a 4 car attached garage and plenty of unique features including a pool house and an in-the-ground outdoor pool in the courtyard.

The house has 7 terraces as well as a roof deck and a solarium.

It has an atrium, skylights and a floating steel staircase.

The listing says it has a “top of the line kitchen” and it also has a second kitchen on the lower level.

It has custom lacquer cabinetry and a large gym.

The house also has 3 fireplaces.

Originally listed in April 2015 for $12.9 million, the price was raised in May of 2015 to $15 million and then lowered in March 2016 to $13.5 million.

It has seen priced reductions ever since to its current list price of $10.9 million.

With the stock market soaring and the largest corporate tax cut in history coming, will Chicago see a single family home sale over $10 million in 2018?

Emily Sachs Wong at @Properties has the listing. See the pictures here.

924 N. Clark: 6 bedrooms, 6 baths, 3 half baths, 15,000 square feet, 4 car garage

  • Sold in February 2008 for $3.75 million (per Zillow- as the CCRD was “down” yesterday)
  • Originally listed in April 2015 for $12.9 million
  • Raised in May 2015 to $15 million
  • Reduced
  • Re-listed in March 2016 for $13.5 million
  • Reduced several times
  • Currently listed at $10.9 million
  • Taxes of $168,742
  • Central Air
  • 3 fireplaces
  • 4 car attached garage
  • Bedroom #1: 41×15 (second level)
  • Bedroom #2: 15×14 (second level)
  • Bedroom #3: 18×14 (third level)
  • Bedroom #4: 16×13 (third level)
  • Bedroom #5: 17×16 (third level)
  • Bedroom #6: 17×14 (lower level)


Looking For a Buyer Since 2012: A 5-Bedroom SFH at 1652 N. Bell in Bucktown

1652 n bell

This 5-bedroom single family home at 1652 N. Bell in Bucktown has been on and off the market since March 2012.

If it looks familiar, that’s because we last chattered about it in October 2012. Back then, we were wondering if staging mattered in million dollar properties.

In 2012, it didn’t have any furniture or even window treatments.

See our chatter here.

The house still has not sold. Five years later, it now has window treatments and furniture.

Built in 2010 on a larger than normal Chicago lot of 38×125, it has three car parking.

The kitchen has Poggenpohl modern cabinets with Viking and Subzero appliances.

It has heated floors and wainscoting.

There’s full house audio which includes the rooftop deck.

The house has a finished basement with a second kitchen.

There’s also a wine cellar.

The listing says it’s just a block to the 606 entrance.

Bucktown has been one of the hottest neighborhoods for the last several years.

With inventory low and the stock market at record highs, will this home finally sell in 2018?

James Prendergast still has the listing. See the current pictures here.

1652 N. Bell: 5 bedrooms, 4.5 baths, 6200 square feet, 3 car garage

  • Sold in June 2006 for $730,000
  • Lis pendens filed in April 2009
  • Bank owned in May 2010
  • Sold in December 2010 for $1.38 million
  • Originally listed in March 2012 for $1.775 million
  • On and off the market over the years
  • Re-listed in July 2017 for $2.65 million
  • Currently still listed at $2.65 million
  • Taxes are now $21,216 (they were $17,686 in October 2012)
  • Central Air
  • Kitchen in the lower level
  • Decks on roof and the garage
  • Bedroom #1: 28×27 (second floor)
  • Bedroom #2: 20×13 (second floor)
  • Bedroom #3: 19×14 (second floor)
  • Bedroom #4: 16×14 (lower level)
  • Bedroom #5: 14×9 (lower level)
  • Recreation room: 27×26 (lower level)


Get a Front and a Backyard with this 2-Bedroom Townhouse: 1636 N. Larrabee in Lincoln Park


This 2-bedroom at 1636 N. Larrabee in Lincoln Park came on the market in October 2017.

This group of townhouses was built in 1985.

The picture above is of the front of 1616 N. Larrabee, which is also in the complex.

They are fee simple which means there is no assessment. Each townhouse takes care of its own outside maintenance.

This townhouse has a 1-car front garage with a private walkway to the door.

The listing says it has been “totally rehabbed” and has a new kitchen and baths.

The eat-in kitchen has what looks to be granite counter tops and stainless steel appliances.

Both bedrooms are on the second floor along with the 2 full bathrooms.

It has the preferred layout of a powder room on the main level.

The listing says its in the Lincoln Elementary school district.

Not only does it have a private walkway and front yard, but it also has a 25×22 back yard.

If you’re a fan of outdoor space, but don’t want a single family home, is this the perfect property?

Pamela Rueve at Coldwell Banker has the listing. See the pictures here.

1636 N. Larrabee: 2 bedrooms, 2.5 baths, no square footage listed

  • Sold in April 2005 for $511,000
  • Originally listed in October 2017 for $695,000
  • Reduced
  • Currently listed at $689,000 (includes garage parking)
  • No assessments- fee simple
  • Taxes of $11,711
  • Central Air
  • Bedroom #1: 24×11 (second floor)
  • Bedroom #2: 12×11 (second floor)
  • Storage: 10×8
  • Back yard: 25×22

Water Walls and Hidden Rooms: A 4-Bedroom SFH at 1457 W. Addison in Southport

1457 w addison

This 4-bedroom single family home at 1457 W. Addison in Southport first came on the market in October 2013.

Most recently, it was relisted in March 2017.

Built in 1901, the listing says it was renovated in 2010.

It’s on a larger than standard Chicago lot measuring 41×134, has a 2-car garage and 7 outdoor areas.

The house has a lot of unique features including:

  • A 3-story water wall
  • A floating staircase
  • Directional art lighting
  • Inlaid medallions
  • Various wood species
  • Exotic marbles/onyx and stone
  • A hidden room (is this like a panic room???)
  • Radiant heated floors in the lower level and all bathrooms
  • 6 fireplaces
  • A home theatre
  • A spa
  • Skylights

The listing calls the kitchen a “chef’s kitchen” with hand made cabinetry, Subzero and a 48″ range.

Originally listed for $4,999,999, it has been reduced to $2.499 million.

Will this house finally sell in 2018?

Michael Hulett at Jameson Sotheby’s has the listing. See the pictures here.

1457 W. Addison: 4 bedrooms, 5 baths, 6000 square feet, 2 car garage

  • Sold in April 1995 for $387,500
  • Sold in March 2005 for $938,500
  • Originally listed in October 2013 for $4,999,999
  • Reduced numerous times from 2013-2017
  • Re-listed in March 2017 for $2.59 million
  • Reduced
  • Currently listed for $2.499 million
  • Taxes of $37,995
  • Central Air
  • 6 fireplaces
  • Bedroom #1: 19×17 (second floor)
  • Bedroom #2: 23×16 (second floor)
  • Bedroom #3: 13×11 (second floor)
  • Bedroom #4: 13×12 (lower level)
  • Family room: 18×16 (main level)
  • Laundry room: 9×6 (lower level)
  • Great room: 34×22 (lower level)
  • Walk-in closet: 9×8 (second floor)


Tired of Vanilla Condos? Live in an Old Ice Storage Warehouse: 345 N. Canal on the Near West Side

345 n canal approved

This duplex 2-bedroom in the Fulton House at 345 N. Canal on the Near West Side, and on the Chicago River, came on the market in October 2017.

Fulton House was built in 1903 as an old cold storage warehouse.

It became apartments in the 1970s and was converted into condos in the 1990s. However, it’s also a live-work building where businesses can operate.

The listing for this duplex says it was newly renovated in 2012.

It has unique barrel vaulted ceilings and exposed brick with vintage porthole windows.

The unit is loft-like open concept living with one bedroom on the main floor and the second one on the second level, along with a den.

It has north and west exposures with a balcony with city views.

The kitchen has an island and stainless steel appliances with modern cabinets.

The unit has central air and washer/dryer in the unit. The listing says valet parking is available, but I believe it is in the River Bend building next door.

For buyers looking to live in the hot near west side, is this unit a breathe of fresh air compared to all the newer construction?

Tamara Kasey at Jameson Sotheby’s has the listing. See the pictures here.

Unit #1402: 2 bedrooms, 2 baths, 2000 square feet

  • Sold in November 1990 for $230,000
  • Sold in July 1998 for $367,500
  • Bank owned in December 2009
  • Sold in June 2012 for $180,000
  • Originally listed in October 2017 for $725,000
  • Currently is still listed for $725,000
  • Assessments of $1335 a month (includes doorman, exterior maintenance, scavenger, snow removal, Internet)
  • Taxes of $7619
  • Central Air
  • Washer/dryer in the unit
  • Valet parking is available
  • Bedroom #1: 22×17 (second floor)
  • Bedroom #2: 13×12 (main floor)
  • Laundry room: 5×3 (second level)
  • Den: 21×11 (second floor)


Love Authentic Lofts? A Brick and Timber 1-Bedroom at 920 W. Sheridan in Lakeview

920 w sheridan approved

This 1-bedroom loft in the Skybox Lofts came on the market in November 2017.

It’s an authentic loft with 13 foot timber wood ceilings and several exposed brick walls.

It has south facing windows with a balcony and the listing says there are refinished hardwood floors.

The kitchen has white cabinets and new granite counter tops and stainless steel appliances.

The bathroom has a new soaking tub, all new tile, and a new vanity with a granite counter top.

It doesn’t look like the bedroom has any windows, however.

The loft has the features buyers look for including air conditioning, in-unit washer/dryer, a fireplace and a heated garage spot is included.

The property is just a few blocks to the Sheridan red line stop for an easy commute.

With inventory so low, and few lofts available in Lakeview, will this loft go under contract before the end of the year?

Antonio Giamberduca at Baird & Warner has the listing. See the pictures here.

Unit #307: 1 bedroom, 1 bath, no square footage listed

  • Sold in April 1998 for $145,000
  • Sold in January 2001 for $223,000
  • Sold in December 2014 for $240,000
  • Currently listed for $324,900 (including garage parking)
  • Assessments of $293 a month (includes exterior maintenance, lawn care, scavenger, snow removal)
  • Taxes of $5763
  • Central Air
  • Washer/dryer in the unit
  • Fireplace
  • Bedroom: 12×11