Chicago Housing Market: Development to Slow in the South Loop
The South Loop, as most of you know, has been on a building boom for over 10 years. It has been named the #1 fastest growing neighborhood in the United States. At least a dozen new high rises are currently under construction in the neighborhood, as well as townhomes and lofts.
But apparently the nationwide housing market slowdown is even affecting the South Loop. The Chicago Journal reports:
Dennis Beninato, real estate tax lawyer and president of the Greater South Loop Association, said development will decrease due to a number of reasons, a few being that loans are harder to get and prices are slow.
“Lending institutions are being much more careful and much more selective as far as who their giving loans to,” Beninato said. “And developers may be waiting until they can sell the units for a higher value.”
Even some developers are sounding the horn that things will be slowing in 2008:
Developer Rick Cavenaugh, president of Fifield Cos., said people are likely to stay renters rather than buy in 2008.
“For people who might be tempted to go from renting to ownership, it’s going to be very difficult to get financing in the future, and cost of financing is much higher than it was two years ago,” Cavenaugh said.
This year will be harder on condo buildings trying to sell units, he said, and developers will likely hold off on other projects.
“I think it’s going to be a cautious year,” Cavenaugh said. “Developers will have to have really good reasons to build new projects. You won’t see some of the marginal deals getting off the ground as you did when we had a real strong market.”
Will more buyers turn into renters in the South Loop? There are some mighty good rental deals in the South Loop right about now. Stay tuned.
Development Boom Expected to Slow: More ‘green’ development could sprout up [Chicago Journal, 1/9/2008]