Market Conditions: Chicago Inventory Continues to Sink, Falling 30.9% YOY in August 2023
The Illinois Association of Realtors is out with the August data. August was before the rates spiked to 20+ year highs but rates were still over 7% in the month.
It was still the lowest August since 2011, which was during the housing bust.
From the IAR:
The city of Chicago saw a 7 percent year-over-year home sales decrease in August 2023 with 2,189 sales, down from 2,354 in August 2022.
The median price of a home in the city of Chicago in August 2023 was $330,000, up 4.8 percent compared to August 2022 when it was $315,000.
August sales since 2007:
- August 2007: 2923 sales
- August 2008: 2078 sales
- August 2009: 1927 sales
- August 2010: 1486 sales
- August 2011: 1787 sales
- August 2012: 2209 sales
- August 2013: 2850 sales
- August 2014: 2414 sales
- August 2015: 2701 sales
- August 2016: 2844 sales
- August 2017: 2791 sales
- August 2018: 2754 sales
- August 2019: 2601 sales
- August 2020: 2870 sales
- August 2021: 2919 sales
- August 2022: 2354 sales
- August 2023: 2189 sales
August Median Sales Price
- August 2007: $305,000
- August 2008: $297,500
- August 2009: $229,900
- August 2010: $200,000
- August 2011: $192,500
- August 2012: $200,000
- August 2013: $245,000
- August 2014: $269,500
- August 2015: $271,000
- August 2016: $271,000
- August 2017: $284,000
- August 2018: $280,000
- August 2019: $289,900
- August 2020: $335,000
- August 2021: $335,000
- August 2022: $315,000
- August 2023: $330,000
“In August, we saw signs that demand is increasing in the city, with only a slight decline in closed sales and a slight increase in median sale price,” said Sarah Ware, president of the Chicago Association of REALTORS® and principal and designated managing broker for Ware Realty Group in Chicago.
Statewide, the number of days on the market was unchanged from last year at 23 days. In Chicago, the days on the market fell 1 day to 27 from 28 days last year.
Inventory continues to plunge statewide and in the city.
Statewide Inventory:
- 34,083 in August 2021
- 29,084 in August 2022
- 20,082 in August 2023 (down 31% year-over-year)
Chicago Inventory:
- 9,231 in August 2021
- 7,999 in August 2022
- 5,530 in August 2023 (down 30.9% year-over-year)
“Although prices declined in August in both Illinois and the Chicago area, they remain much higher than at this time last year,” said Dr. Daniel McMillen, head of the Stuart Handler Department of Real Estate (SHDRE) at the University of Illinois at Chicago College of Business Administration.
“Our forecasts indicate that prices will continue to their usual seasonal decline over the next three months, while remaining higher than at this time last year. The number of sales remains low and is forecast to decline further over the next three months.”
The average 30-year fixed rate mortgage was 7.07% in the month up from 6.84% in July 2023 and up from 5.22% in August 2022. Remember when we thought 5.2% was “high”?
Inventory both in Chicago, and statewide, has been dropping for 2 years.
Is the low inventory the only thing keeping prices elevated? And when will it end?
Illinois home sales dipped while median prices rose in August [Illinois Association of Realtors, Press Release, by Bill Kozar, September 21, 2023]
““Now is still a good time to buy or sell, but there obviously are a lot of factors for consumers to consider,” says Michael Gobber, Illinois REALTORS® 2023 President and designated managing broker-partner, Century 21 Circle in Westchester. “Even in these times of economic uncertainty, when interest rates fluctuate and inflation lingers, they need to seek professionals who have their best interests at heart so they can make the best decisions. Choose a REALTOR®.”
LOL
““In August, we saw signs that demand is increasing in the city, with only a slight decline in closed sales and a slight increase in median sale price,” said Sarah Ware, president of the Chicago Association of REALTORS® and principal and designated managing broker for Ware Realty Group in Chicago.”
Based upon what? There’s a fundimental mismatch here
These folks just cant help themselves
It is dead out there. I don’t even remember 2007/2008 being this bad imho.
I’m actually surprised at sales figures aren’t lower. Looked at a place a developer is flipping around the corner that would be perfect and they are asking $900k. The monthly nut at current rates, property taxes, and insurance with 20% down would be around $8200/mo. The monthly nut two years ago would have been about $5100.
Most people don’t have $3k+ extra laying around in their monthly budget.
“Remember when we thought 5.2% was “high”?”
I remember when 5.2% was low.
per the Freddie survey, starting in APR-71, the first time the 30-yr was as low as 5.2x was JUN-03, and the first time it was under 5.20 was DEC-08.
Rose to 5 as late as FEB-11, and not again until APR-22.
On the flip side, rates were over 9 from DEC-77 to SEP-91.
“Most people don’t have $3k+ extra laying around in their monthly budget.”
They just need to change jobs, Russ! 40% raises all over the place!
@Anon, rates are definitely not that high historically, but the difference is obviously property values are high historically. When I bought my first condo back around 2002 rates were in the 7s if IIRC. However, a jumbo mortgage then was like $330k vs $726k today.
There is a huge disconnect between incomes and rates/home prices. Prices will have to come down.
I don’t see this ending well.
““Most people don’t have $3k+ extra laying around in their monthly budget.”
They just need to change jobs, Russ! 40% raises all over the place!”
Or they can just buy a cheaper place
Russ
Quit being a bear, everyone knows Chicago RE only goes up
People have to live their lives, f’ing themselves over financially is a small price to pay
What I wouldnt give to have a 2/2 shitbox or a SFH in Bronzeville right now. Just sitting on a pile of gold
curious if we’ll start seeing an uptick in inventory as people might be more eager to leave the city. definitely hearing more talk of it amongst my friends. people are really fed up of the crime, lack of punishment, and the mayor.
“However, a jumbo mortgage then was like $330k vs $726k today.”
As recently as 2016 it was $417k and had been at that limit since 2006. But nothing was learned during the last housing crash about getting the government less involved in backstopping finance of properties and getting away from being a society whose economic growth was ever more dependent on asset values vs real productive economic activity.
The housing lobby was likely at it whispering in lawmakers ears to get the limit raised in 2016 to where it is today, barely below the tax deduction limit of $750k and you can rest assured they will be salivating to get that tax exemption limit raised above $750k as soon as possible back to $1MM or more.
At some point we as a society need to come to an understanding that people taking out mortgages above a certain threshold should not expect government assistance. To say that an area is “higher cost” so should have higher limits is just the tail wagging the dog and leading to a self-fulfilling prophecy.
As fooked as Chicago/Chicagoland is the house bubble is so much worse elsehwere. Its batshit crazy in Canada & on the west coast and not much better in the northeast.
This has to be the time the wealth gets redistributed from the imprudent to the prudent and any attempt to interfere in this will just lead to more misery for society longer term.
“But nothing was learned during the last housing crash about getting the government less involved in backstopping finance of properties and getting away from being a society whose economic growth was ever more dependent on asset values vs real productive economic activity.”
How untrue as corporate earnings are expected to be at new record highs next year.
And on the housing front, a LOT was learned during the housing bust of 2008-2012, so much so that we’re not going to have a repeat of it in 2022-2026. This cycle looks nothing like the last one. I don’t understand why the bears keep insisting it is. Credit was not loose in the housing industry and it’s easy credit which leads to bubbles.
“curious if we’ll start seeing an uptick in inventory as people might be more eager to leave the city. definitely hearing more talk of it amongst my friends. people are really fed up of the crime, lack of punishment, and the mayor.”
Wow- really marco? Where are they going to move to, Oak Park, where they just had a string of drive-by muggings just like the city is seeing? Plug in the name of the town and you’ll see carjackings, burglaries, increased crime rings, even at places like Oak Brook Mall. I do have to say, the Oak Brook police have been VERY aggressive at making arrests. They have a good plan in place and it’s working for them.
And what’s the “lack of punishment”? Please be SPECIFIC. Just not seeing that right now.
And “the mayor”? Really? He’s been in office 5 months. The big crisis he’s facing is the migrants and getting them housing. That is going to be a challenge, especially through this winter. What is it about him that they don’t like?
“What I wouldnt give to have a 2/2 shitbox or a SFH in Bronzeville right now. Just sitting on a pile of gold”
I understand the bitterness JohnnyU. For years on this blog, you have just been wishing to move to Chicago because it’s so fantastic. So much so that you come on this blog to discuss our wonderful architecture and housing nearly daily.
It must be tough for those who are stuck somewhere else and can’t move, for whatever reason. Have to live vicariously.
“Or they can just buy a cheaper place”
All the data shows that, yes, they have been going down in price. Just ask the homebuilders who are building smaller, and cheaper, homes which are selling like hotcakes.
America is a monthly payment nation. People go to Russ and ask him how much they can afford to buy with an XYZ down payment. He tells them. That’s what they buy.
Thankfully, in Chicago, you can still move down in price, which is why year-over-year prices in Chicagoland have risen, and other metro areas, have not. We have low inventory, especially in those properties which are considered affordable.
How many 2/2s at $400k are even on the market in Lakeview right now? Not many.
However, with mortgage rates hitting new highs of 7.5%, that is spooking buyers again. Why buy now when rates are likely to cool off by next spring, AND more inventory will be on the market to choose from?
That’s what happened last year. Rates came down, even briefly going back below 6%, and lots of buyers came back into the market.
It’s going to take a lot to get more inventory. I don’t think people on this blog realize just how low it is, historically. It’s definitely going to take a significant job loss event, at a minimum, to see it. A garden variety recession isn’t going to cut it, either.
“There is a huge disconnect between incomes and rates/home prices. Prices will have to come down.”
They already are in many cities. See Austin, Boise, Phoenix, San Francisco, to name a few.
I think that we’ll see many years of no appreciation in the coming years in many cities while incomes “catch up.” Owners will also stay in their current homes much longer. There’s a reason the Baby Boomers stayed in their starter homes for 15 to 20 years.
“They just need to change jobs, Russ! 40% raises all over the place!”
What a stupid comment anon(tfo). You know perfectly well that 40% and 50% pay increases WERE actually the norm in 2021. I told all the younger people I work with to go get it because those conditions never stick around very long (see 1999 when the same thing happened). As the job market tightens, you don’t need to throw money at anyone. Especially not in tech, unless it’s “AI.” Then, apparently, you can start at $700k.
We know that big tech overhired. That’s done now. But that also means they won’t be hiring like drunken sailors again for a number of years. But the hiring could come from other sectors, like construction or energy. We’re still in a labor shortage and the retirement of the Baby Boomers, en mass, is really biting now.
“I remember when 5.2% was low.”
Damn. So you’re a Baby Boomer anon(tfo)? I guess your comments make sense now.
“It is dead out there. I don’t even remember 2007/2008 being this bad imho.”
Yep. Totally dead. Completely frozen. I know someone who listed a property in the suburbs 2 weeks ago and they have gotten NO showings. Their agent thinks it’s the price, but that’s not what it is. Their house is listed completely in line with the comps. It’s that there are really NO buyers right now.
I’m surprised the sales figures aren’t lower too Russ. But it is likely somewhat delayed. Rates didn’t go to new highs until September so I’m expecting those sales numbers to really terrible.
Also, it could be the first time in over year that inventory actually rises. I’m seeing a few more properties just sit now which has pushed up the listings from extremely low to just very low.
“Most people don’t have $3k+ extra laying around in their monthly budget.”
They don’t need to.
Once again, even a mortgage broker is getting it wrong about what happens when rates rise. The person who bought that $900k house 2 years ago with $5100 a month payment is NOT the same buyer when it is a $8200 a month payment. The 2 year ago buyer isn’t “finding” any more money. That buyer would NEVER look at this house because they are now looking at a house that is $650k because they are still qualified by their lender for $5100 a month.
The seller of the $900k house may have trouble selling that home now, however, as the number of buyers who can afford the higher payment does shrink. Despite what everyone on this blog thinks, the entire country isn’t in the top 10% of earners. They all cannot afford the upper end of the GreenZone.
The first place we’ll see real weakness in prices is in the $750k to $2 million price range because they will have to move down in price to afford the same monthly payment. Over $2 million you’ll have more cash buyers and older buyers with equity they can roll over. Higher rates not impacting them much.
“Based upon what? There’s a fundimental mismatch here”
One of the people represents the state of Illinois and the other represents the city of Chicago real estate groups. They aren’t always seeing the same things in their respective markets.
I love how the bears try and negate the data when it doesn’t go in their direction.
“As fooked as Chicago/Chicagoland is the house bubble is so much worse elsehwere. Its batshit crazy in Canada & on the west coast and not much better in the northeast.”
We’re not f*cked. And who cares about Canada? They have adjustable rate mortgages, for goodness sakes. And I long ago gave up trying to predict when the Canada real estate bubble would burst (or China, for that matter.) I’ve been wrong for about 10 years on both.
The hottest market in the country right now is New Jersey, followed by Massachusetts. Go figure.
One thing that could keep Chicago’s market elevated is that even with the higher mortgage rates, it’s many times still cheaper to buy than to rent, as long as you have the down payment.
The rents are outrageous. I think many of you need to go take a look at what the new apartment buildings are charging. Or even the 1970s ones in, say, East Lakeview. A basic 800 square foot 1/1 without laundry but parking is renting for $1800-$2000 a month in East Lakeview. It’s nuts.
“Yep. Totally dead. Completely frozen. I know someone who listed a property in the suburbs 2 weeks ago and they have gotten NO showings. Their agent thinks it’s the price, but that’s not what it is. Their house is listed completely in line with the comps. It’s that there are really NO buyers right now.”
Muh dEmOGRaPhICs?
“Damn. So you’re a Baby Boomer anon(tfo)? I guess your comments make sense now.”
Please tell me you arent this dumb
“Just ask the homebuilders who are building smaller, and cheaper, homes which are selling like hotcakes.”
V s
“Yep. Totally dead. Completely frozen”
Try Sobriety
“So you’re a Baby Boomer anon(tfo)?”
No, I just actually bought real estate in 2001.
I thought bullying wasn’t allowed here. Please edit out the bullying.
“Remember when we thought 5.2% was “high”?”
So I bought my place a year ago. Got a 7 year ARM jumbo at 4.75%. I thought that was high at the time. Went for a jumbo because the rate was lower and figured I would just pay down what I didn’t need after closing and effectively shorten the term of my loan.
By the time we closed I got to thinking I might have a use for the money and with rates on the rise figured I had a shot at making a positive spread. Today I’m getting close to 5.25% on the money and it’s possible that down the road I can lock in a non-callable CD at that rate or higher. Who would have thought?
Fifteen years of a fake economy making savers eat cat food just to subsidize rates to pull demand forward. Now the rubber band will snap back.
Once employment starts to deteriorate and it will, you will see the housing market crash. The Fed is totally incompetent as is congress who knows nothing but to spend. The 10 year rate today says 8% mortgages are around the corner. Even after the tax break that’s over 5.5%.
Even before employment turns you will have the AirBnB attempted empire builders being forced to sell in cities whose regulations recently made their business model unviable.
“Wow- really marco? Where are they going to move to”
Out of state. I have no desire to ever move to the burbs of Chicago. I have no ties there. Whenever I decide to move, it’ll be out state.
“And what’s the “lack of punishment”? Please be SPECIFIC. Just not seeing that right now.”
Huh, really? Just 1 example of a violent criminal being sent home on electronic monitoring. That, I’m my opinion is a lack of punishment.
https://cwbchicago.com/2023/10/chicago-man-carjacking-viral-video-charged-released-electronic-monitoring.html
“And “the mayor”? Really? He’s been in office 5 months. The big crisis he’s facing is the migrants and getting them housing. That is going to be a challenge, especially through this winter. What is it about him that they don’t like?”
My god, the man has an insatiable appetite for spending money with no realistic plan for coming up with the money – except to take money from the top 10% whose votes he can afford to lose. And there’s talk of a financial transaction tax which will either not materialize or drive out all the trading firms. He thinks his job is to appear in photo opps and he constantly talks about “justice” – but never in the same sentence as “criminal”. And he’s great with making excuses for thugs. And he thinks it’s a badge of honor for Chicago to receive dozens of busloads of migrants every week. The death spiral begins.
“Prices will have to come down.”
The country is short how many millions of homes? Prices can’t go below replacement cost or new construction will just stop and then the shortage gets worse.
People will just have to settle for smaller homes with lesser finishes.
“there’s talk of a financial transaction tax”
…every year for at least the past 20.
It is a tax that would never generate a penny of income, as there is no live trading to relocate any more. Maybe if they’d put it in place in the 50s, but then they business would have left long ago now.
“a violent criminal being sent home on electronic monitoring”
Judge: “I do find you’re a danger to the community”
that finding today “should” lead to him being detained until trial.
Maybe the judge doesn’t say that now, when it’s determinative, rather than merely justifying a higher bail amount.
In any case, that bond hearing was 6 weeks before Johnson’s swearing in.
“Out of state. I have no desire to ever move to the burbs of Chicago. I have no ties there. Whenever I decide to move, it’ll be out state.”
Ft Wayne is lovely this time of year. Perfect for those that cant hack tHE BiG cItY
“Huh, really? Just 1 example of a violent criminal being sent home on electronic monitoring. That, I’m my opinion is a lack of punishment.”
This is going to be a growing concern in larger cities. Mayors are bearing the brunt of blame (and are changing their tune) but I havent seen a lot of want from prosicutors and the bench to change the current status quo
“…every year for at least the past 20.
It is a tax that would never generate a penny of income, as there is no live trading to relocate any more. Maybe if they’d put it in place in the 50s, but then they business would have left long ago now.”
Then they’ll just ram through a progressive income tax the same way they did the Workers Rights Amendment. They now know they don’t need the 60% threshold if they can get the progressive income tax on the ballot the same time as a presidential election year: they need 50%+1 vote of the total vote count. Then we’ll be at California tax rates before too long: 9.3% above 132k for a couple.
“It is a tax that would never generate a penny of income, as there is no live trading to relocate any more.”
Then why are derivative firms threatening to leave if the tax passes?
“Then we’ll be at California tax rates before too long: 9.3% above 132k for a couple.”
Come on. We have lower tax rates than Iowa on our wealthy.
“It is a tax that would never generate a penny of income, as there is no live trading to relocate any more.”
As others have said, head of the CME and others in the city have already met with JB and Johnson and told them they will leave if its enacted. If it wasn’t an issue, why bother?
“My god, the man has an insatiable appetite for spending money with no realistic plan for coming up with the money”
Huh? I guess I’m missing it all by living here because I haven’t seen him do ANYTHING yet where he’s spending money and doesn’t have a plan with how to pay for it. I’m sure that will come, though, and that’s where the hard choices are made. Had to be made by Rahm and Lightfoot. Johnson won’t be any different. What I don’t understand is why everyone thinks Vallas would be any different. Hard choices are going to have to be made by anyone in the job.
“And he thinks it’s a badge of honor for Chicago to receive dozens of busloads of migrants every week. The death spiral begins.”
Wow. There really IS a totally different perception of what is going on in Chicago from those who live elsewhere. Just heard that Johnson and JB had a call with the White House today because Chicago is expected to get 25 bus loads, or 1250 people, a day in the next few weeks. No way we can house those numbers. And it’s going to be in the 40s-50s by the weekend. Can’t have people sleeping outside.
Seems to me, the Feds need to shovel even more money to the big cities. Chicago should set up beds in the convention center as a temporary solution. It also doesn’t help that these recent arrivees won’t have work permits. Only those from Venezuela through July can work.
“Once employment starts to deteriorate and it will, you will see the housing market crash.”
Let’s remember, we saw the dot-com boom unwind, and had 9/11 impacts, in 2000-2002, with several million laid off in those years, and STILL, there was no housing crash. Not even in Silicon Valley, which was the epicenter of it all and where over 100,000 people simply up and left. The good thing was that apartment rents came way down. I actually got 1 month free in Palo Alto on a place with granite counter tops in 2003.
I don’t understand people who think you’re just walking away from your house because you lost your job. Maybe you have never been unemployed. For most Americans, their home is their biggest asset. With high rents, most people are going to do whatever it takes to hold on. Thankfully, we’ve had the most qualified buyers in the last few years of over the last 20 years. And they have record equity.
I do expect inventory to eventually rise. But it would still be near all-time lows.
Just a reminder: when I first started running this site in 2007, there would be about 4,000 listings on the market in any given month in Lakeview. Right now, there are about 300. And last I checked, Millennials and GenZ still want to live in that neighborhood.
“Even before employment turns you will have the AirBnB attempted empire builders being forced to sell in cities whose regulations recently made their business model unviable.”
Good. Record low inventory in places like NYC. Some of the STR will become LTR, however.
“Try Sobriety”
Yeah- if you actually knew anything about the new home market, JohnnyU, you would understand what is happening out there. I guess I wasn’t clear.
The market IS frozen. Right now. But the spring selling season was fantastic for the big homebuilders. They’ve been selling the smaller, cheaper homes like hotcakes because there is NO competition with the existing home market, which is usually the norm. When an industry has no competition, they can price at whatever they like and get it.
Cancellation rates are down big with the national homebuilders. Buyers panicked last year but calmed down this year as they got used to the higher rates. They have moved to the sidelines again this fall, just like last year, as rates have hit 7.5%. If they hit 8%, there won’t be anything going on. However, builders are unlikely to panic like last year and dump land. Still no reason to see competition from existing homes for the next 6 months. Should be another good spring season, especially if rates come back down into the 6s.
And demographically, the largest generation in US history is still marrying, forming families, and still wants to buy a home.
“Muh dEmOGRaPhICs?”
Nope. Smart Millennial buyers. They’re not dumb. Neither are GenXers who won’t be selling anytime soon to get an 8% mortgage.
Really, it’s not hard to see what’s going to happen. We’re going to get a repeat of the 1980s. Chicago prices didn’t go anywhere for 6 years. Could happen again if rates remain elevated.
“I haven’t seen him do ANYTHING yet where he’s spending money and doesn’t have a plan with how to pay for it.”
https://abc7chicago.com/chicago-budget-shortfall-property-taxes-brandon-johnson/13779337/
“There really IS a totally different perception of what is going on in Chicago from those who live elsewhere.”
I read the same news sources that I did when I lived in Chicago – and then some. From his twitter feed: “This demonstrates how national, state and local intergovernmental coordination continues to make our city a sanctuary for all who wish to come here.”
So he’s fine with dozens of buses coming every week. No need to rethink the policy. Chicago has a target on its back with people like Abbott and DeSatan. People piled up in police stations is OK. Sure, he’s looking for federal and state money but he won’t get enough money to handle the numbers and he’s wasting what he’s got.
“I haven’t seen him do ANYTHING yet where he’s spending money and doesn’t have a plan with how to pay for it.”
And? Your link doesn’t tell us anything. He hasn’t had to pass a budget yet. That will be coming for 2024. And, yes, the reality is that there are only hard choices. All of us still living in Chicago who had to vote in that election knew that either candidate who got into that job was seriously flawed.
If you had watched the actual mayoral debates, when the candidates actually got a question about the budget and the pensions and how they would manage it all, the answers were LAUGHABLE.
Johnson ignored the question and went on some tangent because he has no experience dealing with big budgets and thinks the money can just appear out of thin air. Or “tax the corporations” will work (it won’t.)
Vallas literally said they could raid some fund (can’t remember right now which it was- maybe the existing pension funds) in some kind of ponzi scheme scenario. I didn’t know which answer was worse but it was clear that neither one had any idea what to do about the city’s finances. You had to laugh or else you would just cry. So the voters rolled the dice and went with the guy who lives IN the city to lead the city.
But one of them was going to get the job and have to deal with it. This is the thing that made Rahm perfect for the gig. Many hated him, and he wasn’t warm and fuzzy, but he made serious decisions that weren’t popular because he HAD to to stabilize the city’s finances. Someone had to do it, and it was him.
Neither Johnson nor Vallas had any plan for “saving” Michigan Avenue or what to do about the Loop. If I recall, Vallas may have been open to continuing the LaSalle Street Corridor plan, to convert offices to apartments and bring more bodies into the Loop full-time, but he never said he WOULD do it. Johnson just ignored it and now it’s been 5 months in office and we haven’t heard anything about it.
But the migrant crisis is a bigger issue right now. 1250 people a day. How can we house all of them? We cannot (neither can Texas which is why they are moving them.) Or at least not quickly. Chicago did manage to house 29,000 Ukrainian refugees over the last 18 months but they had work permits and visas to be here. Makes it easier because they can get apartments and jobs to pay for them.
“So he’s fine with dozens of buses coming every week.”
There are many who want NY, Chicago, LA to suddenly say “no” to being sanctuary cities. The mayor is saying he will not do that.
That is very different from saying he’s “fine” with dozens of buses coming every week. He’s not “fine” with it or else he wouldn’t have been on the phone with Biden today.
He’s getting $30 million from the state which isn’t enough, as we’re going to spend $200 to $300 million, but it’s a start to at least enter into some contracts.
There are two new buildings that they are looking to house people at, one in Pilsen and one on the NW side, but neither is big enough to house even one days worth of people coming right now.
“There are many who want NY, Chicago, LA to suddenly say “no” to being sanctuary cities. The mayor is saying he will not do that.”
So he’s fine with being a sanctuary city and as long as it’s a sanctuary city he’s going to get more of what he wants.
“So he’s fine with being a sanctuary city and as long as it’s a sanctuary city he’s going to get more of what he wants.”
What does that mean? No mayor wants to deal with having to spend hundreds of millions of dollars on migrant care when we already have a deficit and budget issues. As the article you linked to said, Chicago faces an over $500 million budget deficit, with $200 million+ because of migrant costs. Getting “more of what he wants” is irrelevant, right? He has to spend it to house migrants. Feed them. Provide services. It’s not going to go to the other $300 million we’re short.
Is Raleigh taking in migrants Gary? How are they paying for it? Did they take in Ukrainian refugees like Chicago did?
I don’t know what other cities in Illinois are “sanctuary cities” but Joliet is getting $8 million from the state, and other cities also getting money like Champaign Urbana and Springfield. I guess those mayors are “getting what they want”?
I feel like a lot of people don’t really understand what is going on. And isn’t this why Abbott started shipping people out of the state? The Feds weren’t listening to him and Texas was overwhelmed. If he shipped migrants to other cities, they’d get overwhelmed too, and they’d all be in this together. I have to hand it to him, but it worked. With nearly 120,000 migrants now in NYC, the mayor and governor are really pressuring the White House for more money to handle it all.
Chicago is going to get 1250 people a DAY over the next few weeks. A lot are families and those kids are actually being enrolled in school. You need people who can help those families figure out everything. Those kids need to be placed. This is a challenge for all big cities right now.
“Is Raleigh taking in migrants Gary?”
I’m not hearing about it so I assume not. But after living here for a year now I’m glad I don’t live in any of the cities. I’ve decided that I don’t want to deal with urban problems and the cities here have miniature versions (nowhere near as bad) of Chicago’s problems.
“What does that mean?”
Thats its easy to talk shit when there’s no cost.
“Nope. Smart Millennial buyers. They’re not dumb. Neither are GenXers who won’t be selling anytime soon to get an 8% mortgage.”
I though pEOpLe WanT tO lIVe?
Why arent they just buying cheaper properties, like you said they would?
Your consistent in contradicting yourself
“Really, it’s not hard to see what’s going to happen. We’re going to get a repeat of the 1980s. Chicago prices didn’t go anywhere for 6 years. Could happen again if rates remain elevated.”
Why are you such a bear and betting against Chicago?
Chicago’s RE didnt go anywhere (relative) durring the boom either. Lets see what happens with the citys cost of borrowing
“Then why are derivative firms threatening to leave if the tax passes?”
They meet with every knew mayor/guv to remind them that they can leave in the time between passage and effective date. Because politicians are stupid, and need to be reminded of facts.
Why would anybody buy right now that can instead of just wait for short sales and foreclosures right around the corner? This is 2007 all over again and everything is just fine according to the Fed & Sabrinas of the world looking at lagging indicators until its not and we’re in a recession caused by excessive debt and high real interest rates.
Just because bad loans were the garbage product that popped the bubble in RE doesn’t mean they were the only cause the real cause was too much debt relative to the real economy and the same holds true today. RE prices are at a multiple to wages that cannot be sustained without help from asset inflation or bank of mom & pop.
I’m rather glad the speaker of the house is getting canned today because the S is about to HTF and who will the press/D NPCs blame now? The orange man still? Hahaha. It’s over folks you had plenty of time to cash out when the times were good. Debt that cannot be repaid will not be repaid. Bond market knows its over as of past few weeks.
“RE prices are at a multiple to wages that cannot be sustained without help from asset inflation or bank of mom & pop.”
You’re not wrong generally speaking and certainly with respect to most of the country, but when it comes to many of the more desirable places for working-age (22-62 or so) UMC folks to live in this country, the amount of family money, the number of Gen X and older Millennials who vested and sold their stocks/sold startups/sold their starter home at the peak, is huge, and has not only pushed things way up, it’s also arguably set a pricing floor that is going to remain relatively high.
Anecdotally, over the past 1-2 years it’s seemed like lots of Gen X in my neighborhood – people who I think had already gotten a little family help for a home purchase a decade ago – have received much more significant sums from family (perhaps some also did uniquely well stock-wise over the pandemic, e.g., longtime Amazon, etc.). People buying/building homes around ski towns (i.e., those who didn’t already have one), Airstreams and fully-built out Sprinter vans suddenly appearing in driveways, families adding a Tesla as their least expensive/third vehicle, longer stays in Europe, and whatnot. That sort of stuff was apparent before, but lately there’s been a big increase, and I don’t think it’s just a matter of their good saving or risky borrowing habits. Boomer parents are passing away and some living boomer parents are recognizing that their money would be of better use to their kids now than when they’ve passed.
https://www.mortgagenewsdaily.com/mortgage-rates/30-year-fixed
7.72% – Ooooffff
I hope anyone followed Sabrina’s advice and bought a 2/2 shitbox isnt too upset
“when it comes to many of the more desirable places for working-age [] UMC folks to live in this country, the amount of family money, the number of Gen X and older Millennials who vested and sold their stocks/sold startups/sold their starter home at the peak, is huge”
Lots of equivocal words to modify “huge” to apply to *maybe* 20% of the people even within the equivocated demo.
“Anecdotally, over the past 1-2 years it’s seemed like lots of Gen X in my neighborhood”
Proximity bias detected.
“I hope anyone followed Sabrina’s advice and bought a 2/2 shitbox isnt too upset”
Why would they be? They bought with low rates. They aren’t buying right now.
Duh.
“Boomer parents are passing away and some living boomer parents are recognizing that their money would be of better use to their kids now than when they’ve passed.”
GenXers have both Silent Generation and Boomer parents (depending on their age). Silent Generation still has $18 trillion in wealth. Boomers have $78 trillion. There is $11 trillion in IRAs just sitting there (that’s total- so also GenX, Millennials and GenZ but just eye-opening amounts).
Lots of wealth will be passed down in the next 10 to 20 years.
But also, don’t forget, it was GenX that mostly worked at the big tech companies, not Baby Boomers. They had stock options. And those have leached out of Silicon Valley and Seattle now to just about every major city in the country. Facebook’s first office outside of the Bay Area was in Chicago and that was nearly a decade ago.
And as I’ve mentioned before, Chicago has a lot of companies that give out stock options to employees including McDonald’s and CME Group, just to name 2. There are dozens more. Lots of wealth created by the end of 2021.
“Why would anybody buy right now that can instead of just wait for short sales and foreclosures right around the corner?”
In Chicago, that would mean waiting a LONG time (for foreclosures) as it can take anywhere from 2 to 8 years for those to work their way through the system and come back on the market as we all know so well from 15 years ago. My god, I was still seeing 2008 foreclosures come on in 2015.
I HAVE been seeing a smattering of short sales recently Bob. Interestingly enough, their mortgages were circa 2006-2008. Hard to believe, but those are STILL the mortgages that have the biggest failure rate even all these years later.
Crazy.
“Just because bad loans were the garbage product that popped the bubble in RE doesn’t mean they were the only cause the real cause was too much debt relative to the real economy and the same holds true today.”
When you give a strawberry picker making $35k a year a 100% all interest loan on a $700,000 house, problems will arise.
Over the last 3 years, this kind of lending was NOT happening. We will not see the foreclosures or short sales that occurred in the last cycle. Nor do we have the inventories heading into the slowdown like last time.
It is NOTHING like 2008 right now.
“I’m rather glad the speaker of the house is getting canned today because the S is about to HTF and who will the press/D NPCs blame now?”
Do you honestly think there won’t be another Speaker Bob? I don’t understand this thinking. He will be replaced and that person won’t be able to control that caucus either. And the government will shut down on 11/17, causing chaos in the economy just when we don’t need it.
Great governing.
In Nov 2024, voters will again return the House to the Democrats as they are the only party that can actually govern.
“Debt that cannot be repaid will not be repaid. Bond market knows its over as of past few weeks.”
Ba ha ha.
Is this like the time you said there would be a gush of foreclosures once they lifted the moratorium? The bears are SO desperate. I don’t understand why they hate America so damn much.
“Why arent they just buying cheaper properties, like you said they would?”
Because they’re not stupid. This is just a replay of the frozen market from last year. Buyers get freaked out when rates rise suddenly. They have risen suddenly. Buyers were approved at a certain level but it’s not at that now. They won’t buy.
We just went through this last year. Why do I have to keep explaining it?
Sales are really going to fall off a cliff the next two months. I’d be surprised if they weren’t lower than even 2011.
“I’ve decided that I don’t want to deal with urban problems and the cities here have miniature versions (nowhere near as bad) of Chicago’s problems.”
No doubt that when you have millions of citizens versus about a half a million, that things are different. But I don’t really think it avoids the problems. Opiod use is the same everywhere you go. Guns and gangs too. Naperville and Aurora don’t escape urban problems just because they’re smaller.
I was going to crib on this 3-bedroom house in West Lakeview in this gated subdivision, but it went under contract before I could get to it.
12 days on the market even though things are frozen. Wow. I’m surprised. Listed at $670,000.
https://www.redfin.com/IL/Chicago/1802-W-Diversey-Pkwy-60614/unit-K/home/13358141
“Why would they be? They bought with low rates. They aren’t buying right now.”
Because they’re locked into a 2/2 shitbox
Duh
“Over the last 3 years, this kind of lending was NOT happening. We will not see the foreclosures or short sales that occurred in the last cycle. Nor do we have the inventories heading into the slowdown like last time.”
While there might not be the blatant fraud (NINJA), there is a serious disconnect between the rates of income and housing prices (Yeah, not everyone was getting 50% raises a year…)
On inventories, you forgot yet
“Because they’re not stupid. This is just a replay of the frozen market from last year. Buyers get freaked out when rates rise suddenly. They have risen suddenly. Buyers were approved at a certain level but it’s not at that now. They won’t buy.”
Because this is EXACTLY what you said buyers would do.
LOL
“We just went through this last year. Why do I have to keep explaining it?”
Because you lie and gaslight constantly
“Sales are really going to fall off a cliff the next two months. I’d be surprised if they weren’t lower than even 2011.”
Funny how bearish you’ve become
So now mUH dEmOGraPHiCs, wAnTinG tO LivE, LacK oF InveNtoRy, cHeAPer tO bUy are just a fleeting memory lost in time, like tears in rain…
“I was going to crib on this 3-bedroom house in West Lakeview in this gated subdivision, but it went under contract before I could get to it.
12 days on the market even though things are frozen. Wow. I’m surprised. Listed at $670,000.
https://www.redfin.com/IL/Chicago/1802-W-Diversey-Pkwy-60614/unit-K/home/13358141”
I hope the buyers have a good inspector. The EFIS looks challenging
“3-bedroom house in West Lakeview … Listed at $670,000.”
01 price + CPI = $716k. + C-S = $699k
13 price + C-S = $794k (ask is right on +CPI)
16 price + C-S = $747k (ask is a little over +CPI)
And they’ve spent some money on it. And buyer will need to spend more, given the weird vanity light situation in the primary bathroom.
“No doubt that when you have millions of citizens versus about a half a million, that things are different. But I don’t really think it avoids the problems. Opiod use is the same everywhere you go. Guns and gangs too. Naperville and Aurora don’t escape urban problems just because they’re smaller.”
There’s more to it than that even. Look at the political leaning of almost every single city in the country. It’s overwhelmingly Democrat. I’m no fan of the Republicans either but the Democrats running these cities believe the government has a moral responsibility to provide a plethora of free or low cost services. Before you know it the cities are in the housing business and the transportation business and the food service industry and the entertainment business and taxes go up and there is a growing and entitled population dependent on the government. Recipe for disaster.
“Before you know it the cities are in the housing business and the transportation business and the food service industry and the entertainment business and taxes go up and there is a growing and entitled population dependent on the government. Recipe for disaster.”
So Raleigh doesn’t provide ANY services to the population? There is no affordable housing there Gary? No public schools? No buses or other public transportation?
It’s pretty funny that after 30 years of an urban renaissance in American cities, which has led to cities being 2/3rds of the GDP of the country, that you are saying it’s been a failure. Whatever the Democrats are doing, is clearly working.
Damn those Democrats in Raleigh. How DARE they provide affordable housing or other housing assistance. All it leads to is people being dependent on the government. A recipe for disaster.
“The City of Raleigh is committed to creating 5,700 affordable housing units by 2026. Our programs provide down payment assistance for first-time homebuyers, fund home repairs for low-income homeowners, and create affordable rental developments.”
https://raleighnc.gov/affordable-housing
“And they’ve spent some money on it. And buyer will need to spend more, given the weird vanity light situation in the primary bathroom.”
This complex has always struggled due to the location. The train is right there. This one isn’t up against it, but it’s not like you’re not going to hear it.
“Because you lie and gaslight constantly”
I have said the same thing about the market for over 12 months now. And I’ve been bearish on sales for that entire time. They fell off a cliff last year and haven’t recovered. Is it because of the rates or the record low inventory or both?
The spring market surprised me, but rates came down into the 6s (and briefly into the 5s) and buyers adjusted to the higher rates and bought anyway. There wasn’t much on the market so we saw multiple offers and bidding wars.
We will likely see a bounce back again by next year as long as everyone keeps their jobs. There are always two things that move the housing market: rates and employment.
But another scenario is just that prices don’t go up, for many years, as buyers adjust to higher rates (if they stay higher for longer.) We will see.
Record low inventory is new territory for Chicago. Haven’t seen this in decades and we have the largest generation in US history getting married and wanting to buy.
“So now mUH dEmOGraPHiCs, wAnTinG tO LivE, LacK oF InveNtoRy, cHeAPer tO bUy are just a fleeting memory lost in time, like tears in rain…”
Nothing has changed in the last year. Apparently you don’t read the posts on this blog as sales have fallen 30% year-over-year in Chicago for the last year. And we’ve hit 2011 lows at least once already.
But that didn’t impact price. In fact, Chicagoland remains at the top of the Case Shiller index for price appreciation 2 months in a row. Not sure how much longer that will go on but our market is still affordable and inventory remains low.
“Whatever the Democrats are doing, is clearly working.”
it’s CLEARLY not working today.
I grew up in NYC and have lived in Chicago for the past 20 years. different times call for different measures.
“our market is still affordable”
No market is still affordable: the effective rate of mortgages outstanding is 3.6% vs a 7.25% current rates (and going up latest bond yields not yet reflected) is an enormous chasm. The only people not affected by this are those paying cash and those with that kind of cash certainly aren’t jumping RE with it these days given what is coming.
I have been saying this for years and have been repeatedly dismissed by simpleton RE bulls like Sabrina: when you lower rates closer to zero the amount of debt you can lather on increases exponentially. Going from 4% rates to 3% rates allows a much larger boom in RE values vs going from 6% to 7%. Now the market is frozen and in a scenario where only a few short years reflect mortgage rates that have more than doubled. As if this is going to end well.
*Going from 7% to 6%
“I have said the same thing about the market for over 12 months now. And I’ve been bearish on sales for that entire time. They fell off a cliff last year and haven’t recovered. Is it because of the rates or the record low inventory or both?”
Lie
“The spring market surprised me, but rates came down into the 6s (and briefly into the 5s) and buyers adjusted to the higher rates and bought anyway. There wasn’t much on the market so we saw multiple offers and bidding wars.”
What?!?, Where?!?
“But another scenario is just that prices don’t go up, for many years, as buyers adjust to higher rates (if they stay higher for longer.) We will see.”
So buyers are now not “Buying down”? interesting
“Record low inventory is new territory for Chicago. Haven’t seen this in decades and we have the largest generation in US history getting married and wanting to buy.”
So mUH demOgrAphiCs is back in play?
“Nothing has changed in the last year. Apparently you don’t read the posts on this blog as sales have fallen 30% year-over-year in Chicago for the last year. And we’ve hit 2011 lows at least once already.”
So mUH dEmOGraPHiCs, wAnTinG tO LivE, LacK oF InveNtoRy, cHeAPer tO bUy dont matter?
“But that didn’t impact price. In fact, Chicagoland remains at the top of the Case Shiller index for price appreciation 2 months in a row. Not sure how much longer that will go on but our market is still affordable and inventory remains low.”
This is like the worst sales guy bragging that he doubled his sales volume going from 1 to 2 units sold
https://www.reddit.com/media?url=https%3A%2F%2Fi.redd.it%2Fljmw3ycsvzo51.png
“So Raleigh doesn’t provide ANY services to the population? There is no affordable housing there Gary? No public schools? No buses or other public transportation?
It’s pretty funny that after 30 years of an urban renaissance in American cities, which has led to cities being 2/3rds of the GDP of the country, that you are saying it’s been a failure. Whatever the Democrats are doing, is clearly working.”
Where did I say that Raleigh doesn’t provide those services? That was my point about why I’m glad I don’t live in Raleigh or Durham or Chapel Hill (I live outside the city limits) because they all suffer from many of the same issues that Chicago suffers from – except they are just in the earlier stages of the doom loop.
I’ve never been a fan of cities. The only reason they are 2/3 of the GDP is because they have the majority of the people and they developed in a time when people needed to be close to an office and there were a handful of cities that companies thought they HAD to be based in. But that’s changing and people are fed up with urban problems.
https://thehill.com/homenews/3944865-two-million-people-fled-americas-big-cities-from-2020-to-2022/
“The only reason [cities] are 2/3 of the GDP is because they have the majority of the people”
I dunno about the 2/3s of GDP, but even if you expand out to the “urban core” county level (which is a lot bigger than the ‘city’ in, among others, Chicago and LA), it’s only about 30% of people living in them.
Two million people “fled” cities from 2020-22? Interesting. Didn’t read the article, so don’t know if The Hill mentioned whether there was anything noteworthy happening for a couple years in the world starting in 2020 and on top of that something noteworthy happening in larger U.S. cities during summer/fall 2020, which would have influenced that trend.
On people “fleeing” the cities: Yep. It happened. Chicago downtown occupancy went from 95% to in the 80s within a matter of months. Hence why the apartment buildings were giving out 3 to 4 month “free” rent. Lol.
All of this was documented on this blog.
But then, amazingly, people moved back. Chicago, and other cities, saw the buildings fill up again.
“I’ve never been a fan of cities. The only reason they are 2/3 of the GDP is because they have the majority of the people and they developed in a time when people needed to be close to an office and there were a handful of cities that companies thought they HAD to be based in. But that’s changing and people are fed up with urban problems.”
Um…Jerusalem, Mexico City, Istanbul, Rome, Venice and dozens of other cities can attest that humans WANT to live in cities. “Offices” have nothing to do with it. They are efficient, productive and have provided protection from teams of crusading knights. Lol.
They are also the source of most of the world’s creativity.
“The spring market surprised me, but rates came down into the 6s (and briefly into the 5s) and buyers adjusted to the higher rates and bought anyway. There wasn’t much on the market so we saw multiple offers and bidding wars.”
“What?!?, Where?!?”
There have been bidding wars all over the city and suburbs for most of this year (until rates spiked again). We have discussed this many, many times.
Heck, Crain’s had a whole article about how a house in Lincolnwood got 58 offers.
“No market is still affordable: the effective rate of mortgages outstanding is 3.6% vs a 7.25% current rates (and going up latest bond yields not yet reflected) is an enormous chasm”
Why can’t you bears wrap your head around what is happening out there? Do you just ignore the data?
Why is it that Chicago, Detroit, Cleveland are among the top in the Case Shiller 20 city metro areas seeing price appreciation this year? Because they are AFFORDABLE. Buyers who qualified at $500,000 at 5% now qualify for $375,000 at 7%. Are there $375,000 homes in those cities to buy? Yes, there are. Hooray! The buyers are then attempting to buy those houses.
Now, if you’re in LA, there is NO home to move down to to buy. Those buyers are out of the market.
This is why the Midwest and cities like San Antonio, which also still has homes under $400k, will not see the price pressures that other cities are already seeing (like Austin.)
Will be interesting to see what happens in Chicago’s neighborhoods that used to be affordable, but now are not. Are there still enough buyers for that $500,000 Portgage Park bungalow? We will see. Watch inventory in those neighborhoods.
“Now the market is frozen and in a scenario where only a few short years reflect mortgage rates that have more than doubled. As if this is going to end well.”
Market froze last year and then unfroze when buyers adjusted. It helps that unemployment is under 4%, right?
“it’s CLEARLY not working today.”
Cities aren’t creating jobs and other economic opportunities? They aren’t educating the young? There aren’t parks and recreation? What isn’t working?
Are you talking about crime? Pandemic has thrown that for a loop everywhere. Crime is down big this year. Let’s hope it continues heading in that direction. Chicago still hasn’t gotten a handle on the random mugging crews driving around the city. Carjackings are down but still too high. Lots of violence, especially among young people.
“I grew up in NYC and have lived in Chicago for the past 20 years. different times call for different measures.”
What’s the “different times” marco? Crime is much lower citywide in 2023 than in 2003. Many people have selective memory about the good old days.
“What’s the “different times” marco? Crime is much lower citywide in 2023 than in 2003. Many people have selective memory about the good old days.”
So slightly less shitty is acceptable?
Cities aren’t creating jobs and other economic opportunities? They aren’t educating the young? There aren’t parks and recreation? What isn’t working?
1 – Not as well as before
2 – LOL, Large city public schools by in large are a complete disaster and arent educating the non UMC young
3 – If you cant or are reluctant to use them, does it matter?
“There have been bidding wars all over the city and suburbs for most of this year (until rates spiked again). We have discussed this many, many times.
Heck, Crain’s had a whole article about how a house in Lincolnwood got 58 offers”
The old N=1 trick
Other than trying to find a single data point that supports your incorrect views, Why are you talking about the suburbs? As you are wont to say this isnt a blog about suburban realestate
“But then, amazingly, people moved back. Chicago, and other cities, saw the buildings fill up again.”
If true, why cant you give away a condo in SL, DT, RN or GC?
Even you have admitted this
“Um…Jerusalem, Mexico City, Istanbul, Rome, Venice and dozens of other cities can attest that humans WANT to live in cities. “Offices” have nothing to do with it. They are efficient, productive and have provided protection from teams of crusading knights.”
I can’t speak to cities outside the US. The fact is that on a net basis people now prefer living outside the big US cities. And they are not efficient. They are built on an aging infrastructure that is extremely expensive to maintain due to the density (see road closures) and they assume all kinds of taxpayer subsidies to keep running. And they do not provide protection from teams of crusading thugs.
I’ve lived here one year and have yet to deal with or hear about pet poop dropped all over my yard, trash blowing through my property, gang hits, carjackings, or catalytic converter thefts. You know what the neighborhood online groups around here complain about instead? Deer being hit, trees being cut down, and a neighbor who sprays for insects.
“Crime is down big this year. Let’s hope it continues heading in that direction. Chicago still hasn’t gotten a handle on the random mugging crews driving around the city. Carjackings are down but still too high. Lots of violence, especially among young people.”
Wrong again Sabrina. Year to date 2023 vs 2022, every single type of crime except shootings is up. In fact, on the whole, crime is up 27% year over year! That is a staggering stat. It doesn’t matter the category: criminal sexual assault, robbery, aggravated battery, burglary, theft, or motor vehicle theft, they’re all up.
https://home.chicagopolice.org/wp-content/uploads/1_PDFsam_CompStat-Public-2023-Week-40.pdf
But Gary… you can’t get Ethiopian food at midnight! Nor can you go to a drag queen poetry hour at a coffee shop. Absolutely no culture! Aren’t you bored?
“But Gary… you can’t get Ethiopian food at midnight! Nor can you go to a drag queen poetry hour at a coffee shop. Absolutely no culture! Aren’t you bored?”
But you cant be on the streets after dark
Good thing grubhub delivers and you can enjoy it from the safety of your 2/2 Shitbox
“Good thing grubhub delivers and you can enjoy it from the safety of your 2/2 Shitbox”
Plenty of people living in the 2/2 “shitbox” all over the world JohnnyU. Apartment living is universal and desired. There’s a reason we’re building 70 story high rises in Chicago. People love them.
If he’s in the suburbs of Raleigh, why couldn’t you get Ethiopian food at midnight or go to a drag queen poetry hour at a coffee shop? Suburbs have those things too (at least in Chicago). Some of the best restaurants are in the Chicago suburbs. Lots of immigrants opening there.
It does depend on the city though. Chicago is very diverse. We’re so lucky. It’s basically the UN and you CAN get anything you want, food wise. It was a bit shocking for me to go to smaller cities like Tulsa because there are just a lot fewer options.
At least Gary can always get the Casey’s General Store pizza delivered. Lol. Get the app Gary. The pizza is good.
You’re right Mike HG. It’s up this year off of last year. But in most categories, still extremely low levels historically. I was just thinking of the River North data I’ve seen recently which said that violent crime was down 53% this year.
Just looking at robberies, they’re expected to be up from last year but they’re basically back to 2016 levels. If you look at the data, robberies peaked in 1991 over the last 60 years. About 43,000 robberies citywide. Chicago is on pace for between 10,000 and 11,000 this year. 2016 and 2017 were about the same.
Hopefully we see the numbers fall again next year. One year doesn’t make a trend, After the 2016 and 2017 spikes, it fell again until this year.
“The fact is that on a net basis people now prefer living outside the big US cities.”
This is completely and utterly wrong. If true, Austin wouldn’t be building 10,000 apartments. Nor Houston. And Chicago wouldn’t have plans for Lincoln Yards, the 78, Goose Island, and whatever massive new developments they will build over the next 10 years.
Maybe retirees prefer to live outside the cities Gary, which actually wouldn’t make sense because they should be near the hospitals. Heck, even those people moving to the Villages prefer cities as the Villages is now like 100,000 people and has dozens of “town squares” etc. You can’t call that rural living. No one is living on big lots there.
The pandemic appeared to halt the trend towards urban living that returned over the last 20 years in earnest but it hasn’t. Millennials and GenX are moving to Fulton Market at the same pace as 2019 again.
“I’ve lived here one year and have yet to deal with or hear about pet poop dropped all over my yard, trash blowing through my property, gang hits, carjackings, or catalytic converter thefts.”
You can live in Barrington and live this same lifestyle.
By the way, my grandmother lived a seemingly idyllic life in rural Indiana for 40 years. She too didn’t have to deal with gang hits, carjackings or catalytic converter thefts.
But she DID have to deal with meth growing in the woods, opiod abuse, and home break-ins on a pretty consistent basis. It wasn’t exactly paradise. Just different things she had to deal with.
“If true, why cant you give away a condo in SL, DT, RN or GC?”
Buyers don’t want to buy there. They will rent, though. Word is that you can’t make money buying there (they aren’t wrong). So they’ll just rent instead. Lots of new high rises that are nicer than the condo buildings.
No trouble selling in the hot neighborhoods though.
Eventually, that will change. But have to get rid of the inventory in those neighborhoods.
“Other than trying to find a single data point that supports your incorrect views, Why are you talking about the suburbs? As you are wont to say this isnt a blog about suburban realestate”
There were multiple offers on several listings on this blog. We know that because they closed for over ask. I just used the Crain’s example because they had some real doozies from the spring.
There is no “data” that I know of that tracks how many had multiple offers. Can only go off of what the real estate agents are saying and prices closing over list.
“2 – LOL, Large city public schools by in large are a complete disaster and arent educating the non UMC young”
I don’t know where you live JohnnyU, but in Chicago this is simply not true. Only older people harp about how terrible the big city schools are. But it hasn’t been true for over a decade or more now.
And given the crowds at the Lincoln Park Zoo and the conservatories and various other parks in Chicago, I don’t think anyone is “reluctant” to use them. I know for me, personally, I’m at a park several times a week.
“So slightly less shitty is acceptable?”
Again, this is just people spouting whatever they see on Fox News without any idea about what is actually happening in Chicago.
All the old people are all like, “remember when I lived in Wicker Park in 1995 and it was cheap?” And then maybe they remember the gunshots, how they didn’t go out at night, how they carried mace, how they put “the club” on their car steering wheel to prevent theft.
Lol.
It’s all perception. Crime is WAY down from 2003. We just have this perception that it wasn’t “this bad” back in the day, when, in reality, it was much worse.
And I’m not saying it’s paradise in 2023, by any means. There is still a ton of random crime by teenagers all over the city. A week ago, 8 people were waiting for a bus in the South Shore to go to work and a car pulled up and the teens robbed all of them of their phones and wallets at gunpoint. In broad daylight.
Unacceptable.
“All the old people are all like, “remember when I lived in Wicker Park in 1995 and it was cheap?” And then maybe they remember the gunshots, how they didn’t go out at night, how they carried mace, how they put “the club” on their car steering wheel to prevent theft.”
It’s like collective amnesia. Crime was terrible in the early/mid-90s, and the “UMC friendly” part of the city was comparatively tiny.
Yes, Carjackings were pretty rare, and are a big big problem now.
Also, MagMile shops closed at 6 (or was it 6:30?) except on Thursdays.
It was a really different city.
“Plenty of people living in the 2/2 “shitbox” all over the world JohnnyU. Apartment living is hated and not desired. There’s a reason we’re building 70 story high rises in Chicago. People are stuck with them because thats what they can afford.”
FIFY
And Chicago wouldn’t have plans for Lincoln Yards, the 78, Goose Island, and whatever massive new developments they will build over the next 10 years.
Plans and building are 2 separate things
Every mayor has a plan to reduce crime and poverty and improve schools.
“Buyers don’t want to buy there. They will rent, though. Word is that you can’t make money buying there (they aren’t wrong). So they’ll just rent instead. Lots of new high rises that are nicer than the condo buildings.
No trouble selling in the hot neighborhoods though.
Eventually, that will change. But have to get rid of the inventory in those neighborhoods.”
You specifically noted downtown
Keep backpeddaling
“Maybe retirees prefer to live outside the cities Gary, which actually wouldn’t make sense because they should be near the hospitals.”
That was actually a key selection criteria that brought me to this area and this neighborhood in particular. I’m 15 minutes from UNC hospital and about 30 minutes from Duke.
I knew I’d be giving up the restaurant scene and the music scene by moving here but I value my life more than those amenities. There’s decent pizza, burgers, barbecue, sushi, Mediterranean, Mexican, Chinese and Indian food here but you have to hit some restaurants before 8 PM!! There are some cool bars too. The restaurant scene is improving but we haven’t tried the high end yet.
If I was young, drove an old car and good at self defense I would probably prefer Chicago though.
“There were multiple offers on several listings on this blog. We know that because they closed for over ask. I just used the Crain’s example because they had some real doozies from the spring.”
Were?
Are we back to N=1?
“I don’t know where you live JohnnyU, but in Chicago this is simply not true. Only older people harp about how terrible the big city schools are. But it hasn’t been true for over a decade or more now.”
https://www.illinoisreportcard.com/district.aspx?districtid=15016299025&source=trends&source2=proficiency
15% being proficient in math is a good thing? LOL They’re we’ll behind state agerages in Math, Science and ELA. And you’re going to hearld this as a positive?
“And given the crowds at the Lincoln Park Zoo and the conservatories and various other parks in Chicago, I don’t think anyone is “reluctant” to use them. I know for me, personally, I’m at a park several times a week.”
Sure you do…
“All the old people are all like, “remember when I lived in Wicker Park in 1995 and it was cheap?” And then maybe they remember the gunshots, how they didn’t go out at night, how they carried mace, how they put “the club” on their car steering wheel to prevent theft.”
Said no one ever, well maybe HD
“I don’t know where you live JohnnyU, but in Chicago this is simply not true. Only older people harp about how terrible the big city schools are. But it hasn’t been true for over a decade or more now.”
The average SAT score is a touch over 900.
Oooooofff
“I know for me, personally, I’m at a park several times a week.”
“She” is at a park, across the street from a museum, living in a tent printing out glossy RE brochures about Chicago’s urban amenities.
Sabrina I’m seeing a lot of tents pop up in the parks lately, do you reside in them or spin & twirl around the boulevard parks in them whistling at how grand the urban amenities are?
“If I was young, drove an old car and good at self defense I would probably prefer Chicago though.”
I have an old car Gary and refuse to upgrade it because of not only the crime but the highway construction going on which really takes a toll on the suspension and other parts. As its parked outside it can’t be that nice or else will get broken into (even in the “green zone”), so for me to get a nicer newer car I would need a garage spot.
But then it can’t be too nice of a car–even driving around in a Chrysler 300C for instance you could get car jacked for it. If carjackers go relatively unpunished you can imagine how scared car thieves or those who smash windows and grab stuff out of cars are scared of the consequences.
The guy in Baltimore who beat that CEO to death with his bare hands was released after serving less than ten years of a thirty year sentence in deep blue Maryland and Illinois is similar in that time served can be a fraction of the sentence due to the leniency on criminality that permeate deep blue areas.
“The average SAT score is a touch over 900.”
The average SAT score is pretty good for a district with basically 100% taking the test.
“The average SAT score is pretty good for a district with basically 100% taking the test.”
Isnt that a state requirement? CPS is still below the state average
Do you think that those dropping out are taking the test?
““She” is at a park, across the street from a museum, living in a tent printing out glossy RE brochures about Chicago’s urban amenities.”
There’s Bob again thinking I’m some guy in India. I guess Joe’s death wasn’t enough to convince people that I’m not a man.
Bob is clearly THAT sexist that he can’t conceive of a woman running a successful blog for 16 years. It MUST be a man. Sad, as always.
“Sabrina I’m seeing a lot of tents pop up in the parks lately, do you reside in them or spin & twirl around the boulevard parks in them whistling at how grand the urban amenities are?”
You are only seeing them now Bob? I guess you never go to any parks. Or maybe you just don’t notice the homeless. You just walk on by. Because there have been homeless in Chicago’s parks for years (decades?) There are whole tent cities Bob. Although technically one of them wasn’t in a park, but was on the side of the expressway.
Chicago needs more housing and more social services. We can’t make people get off the street, but many are in need of mental health help. I hope the new head of homelessness succeeds at improving the situation. The city also needs more affordable housing. There are waitlists, especially for senior housing. Our seniors should not be living on the streets.
“The average SAT score is a touch over 900.”
It was 911 in 2022. That is below the state average of 970. Lowest state average is New Mexico at 901. States where it is mandated have much lower average scores because it is a college prep test and many students don’t go to college so they otherwise wouldn’t take it.
58.8% of CPS students in 2021 enrolled in a 2 or 4 year college in the summer or fall after graduating. It’s the most recent data.
“Said no one ever, well maybe HD”
People are saying this exact thing all the time on this blog and all over social media.
“But when I lived in Bucktown I got a loft for $500 a month where we had to put a steel bar over the front door to prevent break-ins but it was SO much better back then.”
“15% being proficient in math is a good thing? LOL They’re we’ll behind state agerages in Math, Science and ELA. And you’re going to hearld this as a positive?”
Schools are not the problem in Chicago and haven’t been for a decade or more. How many times do I have to say this to people who don’t live in Chicago and haven’t for decades? This is not 1995. Get into this century. Please, I beg of you.
Is every school in the top 100 in the nation in the massive Chicago Public School system? No. Does every child fit in at every school? No. Are there a lot that fall through the cracks? Of course. But the schools are not a reason you’d move to the suburbs like they were in the 1980s and 90s. The housing bubble changed everything. People with young kids got stuck in their 2/2 shitboxes with kids. They had to enroll their kids and did. Now here we are nearly 20 years later and they’ve all graduated out of CPS.
“Sure you do…”
Yep. Chicago has great parks. I go several times a week with these long days and read. Lots of people there. Many are chatty and so it’s a good way to meet neighbors.
We are SO lucky to have so many good parks all over Chicago. Is the Riverwalk considered a “park”? It has a lot of really good places to go and just sit and people watch or read. I recommend it. I hope they extend it.
“Were?”
Yep. Closing prices have been posted all year on this blog JohnnyU. You’re the only one on here trying to argue that there haven’t been multiple offers on properties IN Chicago this year. Because everyone else knows there have been plenty.
It’s really just so tiring now having to engage with the bears who have been wrong about Chicago and the housing market for over 3 years now.
Still waiting for the crash. When is it coming????
Lol.
“That was actually a key selection criteria that brought me to this area and this neighborhood in particular. I’m 15 minutes from UNC hospital and about 30 minutes from Duke.”
Right. This is why the urban areas will always be preferred. Does anyone think the rich retirees are going to go to some rural areas where they are shutting the small little dinky hospital? No. They won’t. They will do what you did and move near a major research hospital.
Apparently, so many retirees are moving to Delaware with its very favorable tax treatment, that many cannot find doctors. The hospital system is overwhelmed.
“You specifically noted downtown”
Yep. “Downtown” is defined as the area from North Avenue south to Cermak. Lots of great rentals but still too much inventory in condos, especially at the high end.
I do think eventually the Millennials will tire of the 600 square foot 1-bedroom and may want to buy the 850 square foot one or a 1200 square foot 2/2.
“Plans and building are 2 separate things”
If you lived here JohnnyU, you would know what big developments have gotten approval from the Planning Commission and are moving forward. You’d even know which ones have broken ground. Imagine that.
“FIFY”
Yeah- it’s so difficult to have to buy that $3 million 2/2 in River North. But that’s all they can afford so they HAVE to do it. Those poor people.
Ba ha ha ha.
“Yep. Closing prices have been posted all year on this blog JohnnyU. You’re the only one on here trying to argue that there haven’t been multiple offers on properties IN Chicago this year. Because everyone else knows there have been plenty.”
Again this is a lie or you’re extrapolating N=1 as a proxy for the entire market – which is dumb, even for you
“It’s really just so tiring now having to engage with the bears who have been wrong about Chicago and the housing market for over 3 years now.”
Most people dont consider lying as engagement
You really cant help yourself
“Yeah- it’s so difficult to have to buy that $3 million 2/2 in River North. But that’s all they can afford so they HAVE to do it. Those poor people.
Ba ha ha ha.”
I see someone was hitting the boxed wine pretty hard last night
At least the Bears won
“I do think eventually the Millennials will tire of the 600 square foot 1-bedroom and may want to buy the 850 square foot one or a 1200 square foot 2/2.”
I have kids in 6th and 9th grade. They. Have. Classmates. Whose. Parents. Are. Millennials.
Can you imagine buying a property in Chicago for $335k in Aug 2020 only for it to be worth $330k three years later? With increases in property tax and general inflation, only to see the rest of the country gaining 40% equity and some places like Denver, Miami, Charlotte, etc. seeing more. How depressing.
“Bob is clearly THAT sexist that he can’t conceive of a woman running a successful blog for 16 years. It MUST be a man. Sad, as always.”
Is this sarcasm or an attempt to brag?
I can just imagine Sabrina constantly dropping that she runs a successful blog
“Why yes, I run a very successful blog that gets 10’s of responses a day. Most of them are people correcting my misstatements. I am very important and intelligent”
Mike, three years later? More like owning a home for 20 years only for it to be worth what you paid if you are lucky…
RE in this city is a dog. Keeping up with inflation is a win. Most lose money when factoring in transaction costs, upkeep and reno work.
Yep, governor Slabba the Hut JB loves eating all your home values potential gains by making the property taxes even more expensive ton fill the pension punch bowl. Then your home can’t gain value since the property taxes as a percentage of the homes value is so high.
Hey, who says we don’t have diverse food? https://ncstatefair.org/2023/Attractions/New.htm
The list includes African Spinach Soup & Ghanan Pounded Yams
“I have kids in 6th and 9th grade. They. Have. Classmates. Whose. Parents. Are. Millennials.”
I am an old millennial. I have hs/college classmates who have children that will graduate high school this year.
Speaking of JB da Hut it appears someone threw rocks through his window and was arrested & the Assistant State’s Attorney requested the accused have to post a bail to be released?
I wonder why that was as JB da Hut recently signed into law the “SAFE-T” act so the accused were released after signing their own name and walking free. Did the Assistant State’s Attorney not take into account the supposed victim’s opinion on the matter before the magistrate did & released them without bail?
“have to post a bail ”
There isn’t such a thing any more, so whoever asserted that didn’t know wtf they were saying.
“released them without bail”
EVERYONE is either released without cash bail, or held. Period.
Be better Bobbo.
“I wonder why that was as JB da Hut recently signed into law the “SAFE-T” act so the accused were released after signing their own name and walking free.”
Does Bob live in Illinois? You all think I don’t but only someone who watches Fake News and lives in Florida would even be asking this question about Illinois’ bail system.
“Yep, governor Slabba the Hut JB loves eating all your home values potential gains by making the property taxes even more expensive ton fill the pension punch bowl.”
Do you honestly think, Mike HG, that’s it’s JB’s fault that we are in this situation in this state? Come on. Illinois had Republican governors for years. Shouldn’t they take some of the blame for not funding the pensions properly? Same way Daley should take the blame for what is happening in Chicago’s finances.
Nothing comes for free. Illinois has great schools and other public amenities. Money has to come from somewhere.
By the way, this is likely going to be the decade for Chicago’s ascent, especially if mortgage rates remain elevated. It’s the only affordable large city in the country (along with Philadelphia.)
“Mike, three years later? More like owning a home for 20 years only for it to be worth what you paid if you are lucky…”
Depends on several things:
1. Did you buy during, or after, the housing bubble?
2. Did you buy downtown or in a neighborhood or suburb?
Those who bought after the housing bubble have seen decent appreciation. Not surprisingly as they bought after the bust so they got in cheap.
“I can just imagine Sabrina constantly dropping that she runs a successful blog”
No need for me to “drop” about it because most people who are into Chicago real estate already know about it.
But, yes, Bob is sexist and can’t conceive that a woman knows more than he does. About anything.
“I have kids in 6th and 9th grade. They. Have. Classmates. Whose. Parents. Are. Millennials.”
Hooray. They obviously aren’t 28 year old Millennials. Likely the 38+ year old Millennials. Young Millennials still living in the luxury apartments in downtown Chicago, although that’s beginning to turn over to GenZ.
Bears keep on dreaming that things are bearish. It’s been over 3 years since COVID hit and the market was supposed to go to hell. It hasn’t. It took a big blow, though, but it has come back.
And with inventory this low, there’s no housing price crash on the horizon. When there is just a handful of 2/2s under $400k in Lakeview on the market, it’s just impossible, even with these mortgage rates, to see a crash.
https://www.businessinsider.com/house-price-outlook-homes-unaffordable-real-estate-economy-goldman-sachs-2023-10
Was waiting for GS to quote someone that owns a successful blog
Article basically says what we’ve all been saying. Rates have made mortgages unaffordable for majority of buyers. However, prices have not come down because the unintended consequence of fed actions is causing current homeowners to stay put, so they are not selling which is constraining supply.
“Was waiting for GS to quote someone that owns a successful blog”
I don’t do interviews anymore.
“Goldman Sachs noted that one benefit of the current tightness in the housing market is that there won’t be a repeat of 2008, when home prices fell around 20% from their peak in the wake of the financial crisis.
“Looking back to the last housing market crash, we compare conditions which led to a sharp correction in home prices and find market conditions to be far more stable currently,” Karoui’s team said, identifying better credit standards and the death of complex financial products like subprime mortgage-backed securities as factors that will stop a similar-sized crash.”
You don’t have a crash without inventory. In order to get inventory you need:
1. Overbuilding, and/or
2. Massive job losses
Neither of those things is happening. In fact, building slowed last year as interest rates rose. In Chicago, we know that the builders paused in putting up new buildings which means a lot fewer apartments will come on the market next year, which will keep the rental market fairly tight in 2024. However, several big projects are breaking ground, or will soon, so that means more in the pipeline for 2025-2026.
Any economic slowdown should be well over by then.
“I don’t do interviews anymore.”
JoeZ asking you questions doesnt count
“JoeZ asking you questions doesnt count”
Cribchatter was featured in the Tribune back during the mania days.
“home prices fell around 20% from their peak”
Hmmm. What’s the number based on?
Case-Shiller national shows a ~27% decline from Summer ’06 peak to Winter 11-12 trough. Bigger drop in the 20-city and 10-city–both over 30% from Summer ’06 to Spring ’09.
“Hmmm. What’s the number based on?”
It doesn’t say but it does say in the “wake” of the financial crisis, so it is not likely looking at the “winter 11-12 trough” as you looked at. I would think that is looking at through 2009, perhaps.
But you probably have to go read the entire Goldman report for more data.
“in the “wake” of”
I hope that the authors of GS stuff are cognizant enough of metaphor origins to get that a wake has a crest and a trough. But maybe my expectations are too high.
Never actually looked at this data before but obviously it’s not just mortgage rates making homes so unaffordable. And it’s not just the size of homes driving this as price/ SF has skyrocketed recently also. Maybe finishes are nicer? https://www.longtermtrends.net/home-price-median-annual-income-ratio/
“And it’s not just the size of homes driving this as price/ SF has skyrocketed recently also. Maybe finishes are nicer?”
It’s a little of everything: materials costs (appliances are *crazy*), labor costs, scarcity driving pricing power, etc etc
A quick check seems to confirm that we have the biggest homes in the world except for Australia and the size has been growing over time. Part of the affordability solution is smaller homes.
Since Europe does everything better than the US we obviously need to cut our home sizes in half and while we are at it we can impose a VAT tax and give everyone free health care 🙂
Forgot the link: https://shrinkthatfootprint.com/how-big-is-a-house/
Per the New York Times today Gary, houses are shrinking to cope with interest rates and keep prices down.
I hate big houses. I’d rather have a much smaller home with better construction and finishes than some of these 5000+ sqft McMansions that litter the suburbs.
I think the problem is that middle America consumers equate large with luxury. Construction is also only marginally more expensive to build larger, but the developers can charge more.
“You’ll own nothing, and you’ll be happy”
“I hate big houses. I’d rather have a much smaller home with better construction and finishes than some of these 5000+ sqft McMansions that litter the suburbs.”
Well, I have a small house with poor construction and finishes, so I guess I’m halfway there!