Market Conditions: Chicago Inventory Falls 16.3% YOY in November
We already know from Gary’s data that November’s sales were down sharply compared to last year, which was a 15-year record high. They were at the lowest since 2011’s housing bust market.
All of us watching the Chicago housing market know that sales have ground to a halt thanks to higher mortgage rates.
From the Illinois Association of Realtors:
In Chicago, home sales (single-family and condominiums) in November 2022 totaled 1,522 homes sold, a 36.5 percent decrease from November 2021 sales of 2,396 homes.
In the city of Chicago, the median price of a home in November 2022 was $305,000, a decrease of 6.7 percent from $327,000 in November 2021.
Here is the November sales data for the last 15 years (thanks to G for some of the data):
- 2007: 1859 sales and median price of $290,000
- 2008: 1093 sales and median price of $222,500 (16% short/REO sales)
- 2009: 1905 sales and median price of $215,000 (29% short/REO sales)
- 2010: 1144 sales and median price of $182,500 (39% short/REO sales)
- 2011: 1429 sales and median price of $157,000 (43% short/REO sales)
- 2012: 1750 sales and median price of $180,000
- 2013: 1844 sales and median price of $200,000
- 2014: 1638 sales and median price of $230,000
- 2015: 1661 sales and median price of $233,500
- 2016: 1937 sales and median price of $260,000
- 2017: 1959 sales and median price of $256,000
- 2018: 1852 sales and median price of $261.745
- 2019: 1671 sales and median price of $270,000
- 2020: 2018 sales and median price of $295,000
- 2021: 2396 sales and median price of $327,000
- 2022: 1522 sales and median price of $305,000
“The housing market in Illinois has slowed since its peak in June,” 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. “The median home price and the number of sales were lower in November than at the same time last year. The number of foreclosures has increased but is still not high by historical standards. Our forecasts indicate that the number of sales will remain low over the next three months. Prices are forecast to increase slightly in the Chicago area over the few months but are expected to continue to decline somewhat in the rest of Illinois.”
Statewide, inventory fell 12.3% year-over-year to 24,279 from 27,692 even though sales declined 30%.
In Chicago, inventory also fell, declining 16.3% to 6,559 from 7,837 last year.
Days on the market in Chicago also fell again, to 35 days from 36 days last year.
Condos/townhouses remain the weaker market with sales down 40.3% year-over-year to 849 while single family home sales fell “just” 31% to 673.
The average 30-year fixed rate mortgage was 6.81% in November, down from 6.9% in October but up dramatically from November 2021 when it was just 3.07%.
“With many major industries seeing market declines in the face of rising interest rates, it’s no surprise that the November housing market also declined in closed sales, median sales price and inventory,” said Sarah Ware, president of the Chicago Association of REALTORS® and principal and designated managing broker for Ware Realty Group in Chicago. “However, mortgage rates began to drop, which will hopefully draw more buyers into the market as we move towards 2023.”
Will the decline in inventory put a floor under Chicago home prices even with sales plunging?
Illinois homes sell quickly in November; median prices and inventory dip [Illinois Association of Realtors Press Release, by Bill Kozar, December 21, 2022]
I forget where they get their days on the market numbers from but it’s not the way we typically look at it: first list date to contract for homes that close. On that basis average market times are down for attached homes but up for detached homes from 46 days last year to 66 days this year.
Wow Gary – Thats embarrassing for those droning on and on and on about lack of inventory being some sort of savior for the market and really makes the entry level 2/2 look like an even shittier entry point. This should be unpossible with low inventory and muh demographics
Throw in in/shrink-flation and massive restatement of employment numbers for good measure and its not difficult to see that home ownership is going to struggle outside of the upper income bracket
“This should be unpossible with low inventory and muh demographics”
but but the millennials are now turning 40 and are all settling down per Sabrina…… snark
“median price of a home in November 2022 was $305,000, a decrease of 6.7 percent from $327,000 in November 2021”
Or, in real dollars, a decrease of 13%.
Or, in real dollars, a decrease of 13%.
Is that HAWT(tm)?
Thankfully this downturn will be nothing like 2008.
“Or, in real dollars, a decrease of 13%.”
Once again, time to remind everyone that median price really is pretty meaningless. It’s about the mix. In this case, more lower priced properties sold this year than in 2021.
“but but the millennials are now turning 40 and are all settling down per Sabrina…… snark”
Huh? Never said this. Millennials will get married, have kids and want to buy something. Pre-pandemic, they were buying in the city of Chicago en mass. During the pandemic, they fled to the suburbs because they got more space, there was more choice, they were working from home and prices were lower. And now? They’ve returned to the city, along with GenZ. Rental apartments are VERY expensive and mostly full. They are still marrying and wanting to buy. Demographics tell us the largest group of millennials will be in the marrying age through 2024.
Not sure yet when GenZ will want to marry. They are a large generation too. We haven’t built enough housing. They won’t want to be in 500 square foot junior 1-bedrooms in Fulton Market forever.
“Throw in in/shrink-flation and massive restatement of employment numbers for good measure and its not difficult to see that home ownership is going to struggle outside of the upper income bracket”
Restatement of employment numbers? What the hell does that even mean?
Ba ha ha.
All those tech layoffs in the last 6 weeks? Many of those people have ALREADY found new jobs. Some within just 2 to 3 weeks. Lots of companies have been waiting for tech talent. They are still snatching up people.
And there have been few other industries laying off, except, perhaps cryptocurrencies and the like. Still 10 million job openings.
The bears have been wrong for 3 years. Since the start of COVID. And all of 2022.
Housing market is holding its own even with mortgage rates over 6%. But it’s only going to do that as long as employment remains this tight.
“I forget where they get their days on the market numbers from but it’s not the way we typically look at it: first list date to contract for homes that close.”
It doesn’t say how they tabulate it. But I’ve been providing it in the market condition posts for several years so you’re really just comparing it to the data in prior years now. Presumably they haven’t changed the way they have tabulated it during that time.
They also don’t separate out the attached from the separated.
Additionally, the inventory numbers are always suspect too. All depends on what day you are tabulating the inventory. As long as they consistently use the same day (last day of the month?) then at least you can use it as a barometer against the prior year’s data.
“Is that HAWT(tm)?”
Chicago’s housing market hasn’t been hot in about 7 months now. It’s dead. Frozen. Quiet. Inventory is low. Everyone is waiting for the spring season. Got to get some new listings on the market to stir things up.
3 months for this Beverly mansion to go under contract. Pretty house.
https://www.redfin.com/IL/Chicago/8845-S-Pleasant-Ave-60643/home/13100926
Speaking of low inventory, December is always the worst month of the year for new listings but right now it is REALLY low.
There are just 204 properties available in Lincoln Park. Wow. In Lakeview, just 253. Just 23 in Andersonville. 58 homes in Bucktown. 70 in Avondale.
Is it the “Housing market is holding its own even with mortgage rates over 6%” or “It’s dead.”? My guess is it’s closer to the former than the latter, but it can’t be both.
“ 3 months for this Beverly mansion to go under contract. Pretty house.
https://www.redfin.com/IL/Chicago/8845-S-Pleasant-Ave-60643/home/13100926”
You’re welcome
Always happy to educate you on what’s going on in Chicago
Is it the “Housing market is holding its own even with mortgage rates over 6%” or “It’s dead.”?
Well, everyone expected it to be *really* dead, and it’s merely dead.
Only the experts of experts can tell the difference.
“ Speaking of low inventory, December is always the worst month of the year for new listings but right now it is REALLY low.
There are just 204 properties available in Lincoln Park. Wow. In Lakeview, just 253. Just 23 in Andersonville. 58 homes in Bucktown. 70 in Avondale.”
So this low inventory + muh demographics = HAWT Market ™
Right?
“ Is it the “Housing market is holding its own even with mortgage rates over 6%” or “It’s dead.”? My guess is it’s closer to the former than the latter, but it can’t be both”
Makes more sense when you’re into your second box of wine before noon
“ Restatement of employment numbers? What the hell does that even mean?”
https://www.cnbc.com/video/2022/12/22/philadelphia-fed-suggests-bls-overstated-job-growth-in-second-quarter-by-a-million-jobs.html
Embarrassing
screw miracle on34th st and let’s watch princess bride with miracle max
https://youtu.be/d4ftmOI5NnI?t=41
anon:
“Well, everyone expected it to be *really* dead, and it’s merely dead.
Only the experts of experts can tell the difference.”
“median price really is pretty meaningless”
But it shows up in everyone of these posts.
There isn’t a need to repeat it just because the realtors do.
Case Shiller numbers (SFH and Condo) show a drop since a Jul-22 peak, but still way ahead of last year in nominal dollars.
For tax year 2022 Fritz has proposed increasing the “total assessed value” (AV) of 13 North Suburban townships by an average of 37% each. Here are some of his proposed AV hikes:
Barrington: +48%
Elk Grove: +38%
Evanston: +33%
New Trier: +39%
Leyden: +62%
He breaks out by property class type the increase. It looks like North Suburban resi pins (Class 2) would see their AVs increase by only 4.2%, but commercial pins would see theirs increase by 46.4%.
There are different kinds of commercial pins. For 11 of the 13 townships he specifies the AV increase he’s proposing for commercial apartment pins (Class 3). For these pins he proposes to hike their AVs by an average of 64.2%.
Even if the Board of Review reduces that hike substantially, tax bills for commercial apt owners will soar, the cost of which will be passed to tenants, some of whom will need larger housing vouchers, others of whom might be induced to become SFH buyers.
https://www.cookcountyassessor.com/valuation-reports
“Even if the Board of Review reduces that hike substantially, tax bills for commercial apt owners will soar, the cost of which will be passed to tenants”
Only in the short term – maybe. Eventually people leave the area because it’s too expensive. People can only spend so much on housing. What definitely happens is that the value of these commercial apartments goes down.
Too lazy to do the math but if you still end up with a really large net township AV increase (commerical + private) despite having bascially no increase on private, commerical property is/was a huge majority of property (by valuation) in these townships? Its just sort of hard to picture/surprising. Maybe Im missing something.
“Only in the short term – maybe. Eventually people leave the area because it’s too expensive. People can only spend so much on housing. What definitely happens is that the value of these commercial apartments goes down.”
People have been saying this about the big California cities for 25 years. Yet, the cities aren’t dying even as housing prices continue to rise. The rents are also insane.
Depends on what the underlying economy is like, right? Huge increases in home prices in Florida, which has low wages, could be more problematic than those same increases in Silicon Valley where wages are among the highest in the nation.
“But it shows up in everyone of these posts.”
Of course. I have provided it every month for 15 years anon(tfo). It’s general info but doesn’t tell someone what they think it does.
Second quarter job growth? That was 6 months ago now. Yawn. Much more data that tells you what is happening in the job market and it’s just not as bearish as all of you are trying to make it out to be. Sorry!
America is still crushing it. The job market is tight. The Fed is going to have to tighten a lot longer than most believe. Still plenty of worker shortages in many industries that are pressuring wages.
“So this low inventory + muh demographics = HAWT Market ™”
Nope. As I’ve said over and over and over again, the housing market is frozen. Nobody listing. Few are buying. Everyone is waiting for the spring season. Many are renting and waiting for rates to come back down (will they?) and for more inventory.
But the low inventory certainly means we’re not going to see a 10% or 20% decline in home prices in Chicago like is being predicted nationwide this year.
The low inventory is good news for the apartment developers. Certain to see their new buildings fill up quickly.
“Always happy to educate you on what’s going on in Chicago”
Huh? Saw it come through my tracker.
“Huge increases in home prices in Florida, which has low wages, could be more problematic than those same increases in Silicon Valley where wages are among the highest in the nation.”
I think there are people who moved to FL in the past few years who have tech, and other jobs, working mostly remotely, with wages that, while not as high as the NYC/CA/Chicago, certainly are not low. The Miami office market continues to grow. Lots of big law firms moving into that market or growing what had previously been small offices. I’d be surprised if there are begin declines in the FL market – still tons of boomers who want to move there and lots of older Gen X would love to also, and a lot of 20/30 somethings find it desirable.
“I think there are people who moved to FL in the past few years who have tech, and other jobs, working mostly remotely, with wages that, while not as high as the NYC/CA/Chicago, certainly are not low.”
Everyone else does not anonny. Go to Tampa or Sarasota. Do the wages match the $600,000+ average home price? Do the northern retirees who have moved to those cities, many from Chicago, have the firepower to now sell their Chicagoland house and move down there and pay all cash to live the retirement dream? I would answer “no.”
Also, Florida minimum wage is low. It’s $11 an hour and won’t go to $12 until September. There are thousands of office and hotel cleaning crews in Miami who make only the minimum wage. Do you think they’re affording any of the housing?
There were always cheap parts of Florida. All you had to do was move off of the water and go inland and you could find something affordable. Not any longer. But the wages just don’t match, nor does the job market. 60% of the residents are over 60 and the schools stink. It just doesn’t have the job market like other big states like Illinois, NY, CA or Texas. Or even Pennsylvania or Michigan.
And the layoffs, when they come, WILL impact those tech workers who moved there. How many worked for Twitter? So far, many are finding work pretty quickly but maybe that means they leave Florida and move back to the Bay Area to do so.
Florida, by the way, was the top gainer of population this year for the first time in like 40 years. Will be interesting to see what happens this year there now that affordability is hitting. Has some of the highest property and car insurance rates in the country. Who can afford it?
I’ll be interested to see what happens to Texas too. The hot energy industry should really put a floor under Dallas and Houston. They can’t hire enough people and when energy is booming, Houston is too.
“And the layoffs, when they come, WILL impact those tech workers who moved there. How many worked for Twitter? So far, many are finding work pretty quickly but maybe that means they leave Florida and move back to the Bay Area to do so.”
So, they’ll lose their tech job, and in order to get another one, will need to move back (assuming it was CA they left in the first place) to a higher cost place?
“60% of the residents are over 60 and the schools stink.”
I think you’re overestimating the value that a lot of adults of school age or soon to be school age kids place on education.
Almost everyone who voted for Trump in 2020 and lives in, say, New York state, or IL, or CA, or PA, and on and on…they pretty much universally DREAM of having FL’s governor as their governor, and they cannot wait to elect him president. It’s not good, but’s reality.
“60% of the residents are over 60 and the schools stink.”
I recall reading that it didnt matter where your kids went to school?
“Also, Florida minimum wage is low. It’s $11 an hour and won’t go to $12 until September. There are thousands of office and hotel cleaning crews in Miami who make only the minimum wage. Do you think they’re affording any of the housing?”
Are were really comparing Minimum wage with tech jobs as it relates to housing?
“Florida, by the way, was the top gainer of population this year for the first time in like 40 years. Will be interesting to see what happens this year there now that affordability is hitting. Has some of the highest property and car insurance rates in the country. Who can afford it?”
Vs Ca and its +12% (marginal) Income tax rate? Ridiculous energy costs, etc? And it aint exactly like the COL is cheap
Is Cali moving forward with the
“So, they’ll lose their tech job, and in order to get another one, will need to move back (assuming it was CA they left in the first place) to a higher cost place?”
Many companies are now requiring hybrid anonny. Perhaps there are enough jobs in Miami/Tampa/Jacksonville/Orlando for those who are laid off. Perhaps not.
Maybe Chicago will be able to lure some of those workers.
“I think you’re overestimating the value that a lot of adults of school age or soon to be school age kids place on education.”
Nope. Big complaint by the hedge funders who have left NY and moved to Miami. Only a handful of “acceptable” private schools and they simply can’t handle hundreds of new kids.
There’s a reason New Jersey is one of the hottest real estate markets going into 2023. Not what you would have thought, right? Some people moving back.
“Are were really comparing Minimum wage with tech jobs as it relates to housing?”
It goes to the low wages and low wage jobs that dominate Florida’s economy. They must really be livid that cryptocurrencies have busted as Miami was betting its future on being the hub of that. Whoops. Guess that won’t work.
But leave Miami, which is the biggest economic engine. Disney is building housing for its workers in Central Florida because they are priced out now. That has never happened before.
Florida’s economy simply doesn’t support those home prices. California HAS the economy and wages. It has the 6th largest economy in the world.
https://www.fox35orlando.com/news/disney-affordable-housing-new-details-released-for-80-acre-real-estate-project-in-central-florida
This is the new reality in Florida. Last time I saw this was in 1999 when Cisco was going to build housing for teachers in Silicon Valley.
“This is the new reality in Florida”
How is this the new reality in Florida? DW performers were always low paid and had issues affording housing.
Wonder if they’ll open a company store and issue script
“it goes to the low wages and low wage jobs that dominate Florida’s economy. They must really be livid that cryptocurrencies have busted as Miami was betting its future on being the hub of that. Whoops. Guess that won’t work.”
So all of the transplants are low wage or in crypto?
“Florida’s economy simply doesn’t support those home prices. California HAS the economy and wages. It has the 6th largest economy in the world.”
If it cant support the home prices, prices will fall
How is a cleaning crew affording housing in SV?
“How is this the new reality in Florida? DW performers were always low paid and had issues affording housing.”
Nope. It was always considered a really well paying job in Florida which got many out of the working class and into the middle class. But the pandemic meant many were laid off and then housing costs skyrocketed and now Disney is building apartments not just for their own workers but others in the area who are also priced out.
What a shame.
LOL
No
CRM is going to layoff 10% of its workforce, wonder what the impact will be in Chicago?
“CRM is going to layoff 10% of its workforce, wonder what the impact will be in Chicago?”
Probably big as they have one of their biggest offices here. Laying off about 8,000 people total. That is the danger with the tech layoffs this go around. In 2000-2003 they were mostly confined to Silicon Valley/Bay Area and Silicon Alley in NY with a smaller amount in Austin. But now, you have massive Amazon offices in DC suburbs and Nashville. Huge Salesforce office in Chicago. Thousands of Alphabet workers in Chicago. Microsoft Midwest headquarters in St Louis.
The whole point of it was that they were expanding so quickly they couldn’t find enough talent in their home market. Had to go elsewhere. Also, lower costs in many other cities for that talent. But now, as they lay off, it’s going to impact many more major metros.
Thankfully, the job market is tight. According to the WSJ, tech workers are already being absorbed in other industries that need tech talent but were considered “second choice” by workers. They may go to a financial services company, food or agriculture now.
At least Benioff is admitting he overhired. They ALL did.
The energy industry is still hiring thousands, and they need tech workers.
Sigh.
https://www.washingtonpost.com/graphics/2020/national/disney-layoffs-coronavirus/
A waitress at one of the restaurants:
“The hardest parts for Flaviana were accepting the reality that her Disney job was gone; that the modest middle-class life that she had built was no longer sustainable; that she wouldn’t be able to provide Victoria, a bright and imaginative teenager whose autism made everyday tasks difficult, with the classes and therapists that enabled her to learn and share her thoughts and feelings.”
One of the reasons Disney has been so successful in Florida is because it WAS so cheap to live there. Rents, and houses, used to be cheap off the coasts. Dirt cheap.
Disney could keep its costs down because it didn’t have to pay huge wages. But not anymore. The fact that they are building affordable housing themselves is a sign they realize the danger that lack of affordable housing is presenting to their business model, or even in just finding talent to work for them anymore.
Such a shame. But as costs rise simply to live in Florida, home owners insurance and auto insurance costs, people will leave. Georgia, Tennessee, the Carolinas, Alabama will all be beneficiaries.
“Probably big as they have one of their biggest offices here. Laying off about 8,000 people total.”
2019 headcount was 35,000; 2022 headcount 73,541. ~8,000 layoffs isn’t going to be much of an impact.
If you are laying off more than 250 employees in Illinois you need to file a WARN Notice. No WARN Notice has been filed as of yet from Salesforce. I assume if you are publicly announcing layoff plans you are simultaneously filing these notices. Not sure how quickly a notice would be publicly available however. So I imagine if this does impact Chicago based employees we will know in the coming weeks and the extent.
“Disney could keep its costs down because it didn’t have to pay huge wages. But not anymore.”
Oh boohoo. Over the past decade how much have their ticket prices increased? One day passes in 2013 were $85 – $90. Today, it is $110 – $190 depending on the time of year.
They have also been keeping costs down at their media companies over the years – ESPN/ABC, etc. while also growing revenue from streaming.
“Disney could keep its costs down because it didn’t have to pay huge wages. But not anymore. The fact that they are building affordable housing themselves is a sign they realize the danger that lack of affordable housing is presenting to their business model, or even in just finding talent to work for them anymore.”
I know a cast member in the early 2000’s that was living 4 in a 2Br (all cast members/performers).
They didnt make jack
https://www.glassdoor.com/Salary/Walt-Disney-Company-Orlando-Salaries-EI_IE717.0,19_IL.20,27_IM645.htm
Do these salaries look Middle Class to you?
“Probably big as they have one of their biggest offices here.”
Probably pretty small. 2019 employee count was 35,000 compared to 73,500 today. Going to 66,500 is meh.
We will get more hard numbers for Chicago once their WARN notice is filed with the State.
With most of these larger employers who have announced or will announce layoffs in the coming weeks/months as of now it looks like its more from over-hiring and that their employment levels for now will still remain above what they were over the past 12 – 18 months.
They are laying off nearly 8,000. Even if Chicago just has 300 of those, that’s a considerable layoff for the city.
“Do these salaries look Middle Class to you?”
Yep. Average of many of those submitted is around $45k. This is what the vast majority of America earns. $40k to $90k. Middle class.
You all are so delusional about what 90% of America makes and lives off of.
“I know a cast member in the early 2000’s that was living 4 in a 2Br (all cast members/performers).”
I’m sure. But that was then and this is now. That literally is 20 years ago. Lol. Are you going to tell us stories about how they could barely afford that $100 microwave too so they didn’t buy one?
“Oh boohoo. Over the past decade how much have their ticket prices increased? One day passes in 2013 were $85 – $90. Today, it is $110 – $190 depending on the time of year.”
No one is boohooing. But the reality is that Florida used to be cheap. Dirt cheap. You could buy a house for $100k in the swamps. Not anymore. It’s going to have BIG consequences on a state that has never dealt with that.
By the way, as of November, about 288,000 tech job openings nationwide. It’s the lowest in over a year but still relatively elevated.
But all layoffs suck even if there are job openings to move into. And many haven’t had to deal with layoffs ever in their lives.
“Yep. Average of many of those submitted is around $45k. This is what the vast majority of America earns. $40k to $90k. Middle class.
You all are so delusional about what 90% of America makes and lives off of.”
First off theres a huge difference between $45 and $90k – you cant be that dumb to think they’re remotely similar
Second – Not sure where you went to school and these are only “numbers” but the average isnt $45k; its closer to $38k below what you define as middle class
You are so dishonest
“I’m sure. But that was then and this is now. That literally is 20 years ago. Lol. Are you going to tell us stories about how they could barely afford that $100 microwave too so they didn’t buy one?”
You said that it was a well paying job.
I tell you that it wasnt and give you an example that cast members/performers needed to double up in an apartment to afford rent
So are so drunk you cant even remember the points you are trying to make
“I tell you that it wasnt and give you an example that cast members/performers needed to double up in an apartment to afford rent”
20 YEARS AGO!
LMFAO.
Get into this century. My god.
“First off theres a huge difference between $45 and $90k – you cant be that dumb to think they’re remotely similar”
This is middle class. And, gasp, this is what a majority of Americans make.
Move on JohnnyU. Disney has thousands of good middle class jobs but only when the housing was cheap. Now it’s not. It’s going to be rough in Orlando going forward. What a shame.
No company builds housing to be nice or provide perks. They’re doing it because they won’t be able to find the talent and it’s cheaper for them then raising wages significantly.
” One of the reasons Disney has been so successful in Florida is because it WAS so cheap to live there. Rents, and houses, used to be cheap off the coasts. Dirt cheap.”
Now I’m sober but “WAS” typically denotes a time in the PAST
Is 20 years ago not in the PAST
Or do you have another definition you’d like to use for WAS?
You literally argue like a 4 year old
“This is middle class. And, gasp, this is what a majority of Americans make.”
Sub $40k is not middle class
“Move on JohnnyU. Disney has thousands of good middle class jobs but only when the housing was cheap. Now it’s not. It’s going to be rough in Orlando going forward. What a shame.”
Sober up Sabrina. It was always difficult/compromises needed to take a non-white collar job at Disney. The biggest difference is the 20 somethings that used to be willing to live 4 in a 2Br are a lot more scare today
“It’s going to have BIG consequences on a state that has never dealt with that.”
Seems to be working out fine in North Carolina, Tennessee, Arizona, Colorado, etc.
“No company builds housing to be nice or provide perks. They’re doing it because they won’t be able to find the talent and it’s cheaper for them then raising wages significantly.”
I just don’t understand how this makes sense for an employer. So they want to get in the real estate development business? They can do it cheaper than a developer with experience?
“I just don’t understand how this makes sense for an employer. So they want to get in the real estate development business? They can do it cheaper than a developer with experience?”
They hire out for all of that Gary. They hire the developer but they own the building. It’s just another part of their already massive real estate empire so no big deal. And then they can control rents etc. This is a company that already owns hotels and cruise ships. Lol.
For Cisco, it literally was a way to lure workers to the Peninsula because if the schools suck, the talent wasn’t going to go there. But the teachers were priced out. Some lived in their vans and showered at the gym each morning. Shameful.
But the dot-com bust happened and that eased some rental prices as about 200,000 people fled the Bay Area freeing up housing. Rents came down.
“Seems to be working out fine in North Carolina, Tennessee, Arizona, Colorado, etc.”
What does home prices doubling in Florida have to do with the other states? Nothing. Absolutely nothing.
People moved to Florida because it WAS dirt cheap. You could be middle class, sell your $250k house in Chicago suburbs and move down to the Tampa suburbs and buy for $200k. Living the dream on your social security. Never shovel again. But now, that same house is $500k+. Insurance costs soaring. Nothing is cheap anymore.
Florida has seen two other bubbles which busted, of course. Prices came back down. Wouldn’t be surprised if that happened again.
“Sober up Sabrina. It was always difficult/compromises needed to take a non-white collar job at Disney. The biggest difference is the 20 somethings that used to be willing to live 4 in a 2Br are a lot more scare today”
Apparently you can’t read JohnnyU. No surprise. The Disney jobs in Central Florida were covered extensively in the pandemic. The workers were devastated. Like the waitress in the Washington Post article, it gave her a good job that she loved. The other workers were her FAMILY.
She supported her children, one with special needs, by waitressing. That’s middle class. It was a GOOD job with benefits. The articles talked a lot about the free family passes workers get which they all use to take their own families to the parks. Nice perk that saves them thousands of dollars.
“Was” JohnnyU. As in less than 3 years ago.
Just educate yourself. It really can’t be that hard, can it? Florida’s housing crisis has been well documented during the pandemic.
“They hire out for all of that Gary. They hire the developer but they own the building. It’s just another part of their already massive real estate empire so no big deal. And then they can control rents etc.”
But they aren’t doing it any cheaper than real estate developers and if they hold rents down then they get a below market return on their investment. The loss = a rent subsidy to the employees which could just as easily be given as raises. It’s a zero sum game.
“ Disney is building housing for its workers in Central Florida because they are priced out now. That has never happened before.”
Never happened before = less than 3 years ago?
“ Nope. It was always considered a really well paying job in Florida which got many out of the working class and into the middle class”
Vs
“Disney could keep its costs down because it didn’t have to pay huge wages. But not anymore
Sober up, it’s getting embarrassing watching you flounder around
“The loss = a rent subsidy to the employees which could just as easily be given as raises. It’s a zero sum game.”
The apartment prices are so high now that they literally can’t attract the workers they need. That’s how crazy it is in Central Florida now.
Blah. It’s always a red flag when a big employer says they have to build housing for workers. Been down that path before. But it also is usually a sign of the top of the housing market.
https://www.apartmentlist.com/rent-report/il/chicago
Sabrina is the Jim Cramer of Chicago real estate
Just posted my monthly update. We now hit a 14 year low in closings during December. Inventory, as measured in months of supply, is up and the market time for detached homes is also up. Contract activity also really low so January is not going to be any better. https://lucidrealty.com/chicago-real-estate-market-update-14-year-low-in-home-sales/
“60% of the residents are over 60”
Where?
In the whole of Florida? Nah, only off by nearly a factor of *3*.
65+ (yeah, not exactly the same) population of Florida is 21.1%:
https://www.census.gov/quickfacts/FL
Which makes FL only the #2 state by percentage of 65+.
Florida and Vermont are the oldest states in the country, right? It’s why the schools suck in Florida. None of those retirees want to pay extra for that. It’s a shame. But perhaps if more families move there that will change.
“Just posted my monthly update. We now hit a 14 year low in closings during December. Inventory, as measured in months of supply, is up and the market time for detached homes is also up. Contract activity also really low so January is not going to be any better.”
Thanks Gary. I don’t think anyone is surprised that sales are that low. It’s dead out there. Also not surprised inventory is up. What I’ve noticed is that a lot of people who couldn’t sell this fall, withdrew their listings for the holidays and are now relisting in the first few weeks of the year.
They seem to be early but with our good weather, why not? It’s really going to be the job market that impacts housing, nationwide, going forward. If you’re worried about losing your job, you don’t buy.
In Chicago, McDonald’s will soon be announcing a big round of layoffs. It’s certainly going to hit the city and suburbs, I’m sure.
Here’s the data. I thought it was Vermont, but it’s Maine. Young people didn’t want to move there. No jobs.
Illinois is surprisingly relatively young. California too. But Utah is where you want to be for the youngest population.
https://www.prb.org/resources/which-us-states-are-the-oldest/
Please immediately delete all of Helmethofer’s comments. He/she eventually going to go down his/her rabbit hole of hatred.
“his/her”
I’m pretty sure it is they/them/their.
“perhaps if more families move [to FL] that will change”
Florida is #46 for percentage of 0-18 at 20.8%, but that’s just behind Massachusetts (#45, 21.0%) and Connecticut (#42, 21.6%) which both have (at worst) top 3 public schools.
I think that Florida could have more kids than Utah, and it ain’t going to end up with better than generally shitty public schools.
Interesting is how close IL is to US averages in all age cohorts:
0-18 = same as all USA
19-25 = same as all USA
26-34 = 0.2% lower (3 states closer to average)
35-54 = 0.5% higher
55-64 = 0.1% higher
65+ = 0.4% lower
w/o looking at every state, Tennessee is the only one comparably close to averages overall.
https://www.kff.org/other/state-indicator/distribution-by-age
Thanks Mike HG. They are deleted as there is no space for Helmethofer here.
Ment prices dropping
Unpossible!
https://calculatedrisk.substack.com/p/lawler-freddie-mac-national-home
Oh no, national home prices are dropping. I should hope they would in Austin, Boise, Miami, Tampa, Phoenix, Las Vegas and elsewhere. Mini-bubbles in lots of cities. Sanity will return with mortgage rates over 6%.
Lots of complaints about Chicago’s housing market but we didn’t have a bubble here so we won’t see a bust. We have affordable properties. Buyers will move down in price and still be able to buy.
Same in St Louis, Indy, Milwaukee, Detroit, Cincinnati, Pittsburgh.
One more story about a pin owner (1029 W. Cullerton) complaining that their tax bill quadrupled:
https://abc7chicago.com/cook-county-property-tax-pilsen-assessor-fritz-kaegi-taxes/12694741/
Recent assessed values:
2017 = 353,800
2018 = 271,640
2019 = 271,640
2020 = 236,320 (Year of the Covid markdown)
2021 = 880,000
Taxes:
2017 = 2,912
2018 = 2,853
2019 = 4,217
2020 = 4,020
2021 = 16,491
I’ve seen similar-looking buildings in similar hoods appraised for more, so I doubt the bill will be reduced, but it never hurts to protest loudly.
Why isn’t anyone asking why they don’t have the senior exemption too? Did it go up to $16,491 even with the senior exemption? She is 80. Has lived there 40 years. The whole point of the senior exemption is that they don’t have to sell when they age and are on fixed income.
But her shock at seeing the taxes jump like this is really the fault of the assessor. If they had been doing their job for the last 10+ years, the taxes would have been rising more slowly each year, allowing homeowners to adjust to it. It’s hard for anyone, even if you’re not on fixed income, to suddenly go from $4k a year to $16k. And they were given just 2 months to pay $14k of it.
The failure was in the assessor who basically hasn’t raised property taxes in Pilsen for years even though the neighborhood has been gentrifying this entire time. And now they’re like, “surprise!”
“Why isn’t anyone asking why they don’t have the senior exemption too?”
HAs senior exemption, but not the Freeze, which is the big one. Freeze applies if HHI is under $65k (2020).
If they are eligible for the freeze, someone should have helped them apply 10+ years ago. If they aren’t…they have a fixed income over the area median, which is a lot less sympathetic story.
They appealed their AV in 2018, when it was initially $36,660, so part of the failure to increase is on the BOR rather than the assessor.
There has also been a certificate of error filed for the ’21 taxes, so there may be something missing here.
Thers is also a whole-ass coachhouse (2.5 story, with basement) in the back that isn’t reflected in the assessor’s description of the property.
“The failure was in the assessor who basically hasn’t raised property taxes in Pilsen for years even though the neighborhood has been gentrifying this entire time”
The assessor assess property values. They do not raise/decrease taxes. The local and county taxing bodies raise and decrease taxes.
Further, your assessment completely ignores the Board of Review and TIF districts as well.
“Oh no, national home prices are dropping. I should hope they would in Austin, Boise, Miami, Tampa, Phoenix, Las Vegas and elsewhere. Mini-bubbles in lots of cities. Sanity will return with mortgage rates over 6%.”
Rent prices are falling…
“But the tax rates haven’t been reduced so that the total levy collection remained the same. … a big total levy collection increase.”
What the fuck does that mean?
The tax rate is *always* determined by the aggregate levy divided by the Equalized Aggregate Assessed Value.
The proposition you put forth is (like so much of your other blather) not based in reality.
“Elon Musk[]’s for free speech”
Try posting video of the self-crashing Tesla on the Bay Bridge and see how fucking “free” the speech is.
I’m actually working on a blog post on this topic. There’s a lot of misinformation out there. The assessed values in Chicago went up 13 – 23% on average in different parts of the city. Sure, there are anecdotes of specific properties with much higher increases but that’s the problem with anecdotes. Oh…and that’s from the lowered Covid values. And the tax rates did go down but not enough to offset the increase in the AVs. And, yes, part of the problem is that the budget keeps going up.
“And the tax rates did go down but not enough to offset the increase in the AVs. And, yes, part of the problem is that the budget keeps going up.”
Yes, the budgets keep going up but for this year wasn’t the impact of shifting more of the burden onto residential from commercial more of a factor at least for this past year?
TIF analysis by taxing district would be interesting as well. Either Crain’s or the Tribune reported over the last month there is $1.8 billion of property taxes that are captured through TIF’s currently which seems absolutely ridiculous. That’s not counting the $1.0 billion for the red line that was recently passed.
“Yes, the budgets keep going up but for this year wasn’t the impact of shifting more of the burden onto residential from commercial more of a factor at least for this past year?”
I’m going to see how easy it is to try to quantify the different factors. Have not tried yet.
30 year fixed rate mortgage is now averaging 6.04%. The FOMC has to be pissed. This is NOT what they want.
“but for this year wasn’t the impact of shifting more of the burden onto residential from commercial”
That was all done at the BOR. Assessor’s office raised commercial much more, but it all got undone at BOR.
Net reuslt of Kaegi’s strategery? Lining the pockets of the tax appeal lawyers.
Here’s the tax rate report from the Clerk, with the aggregate details:
http://www.cookcountyclerkil.gov/sites/default/files/pdfs/2021%20Tax%20Rate%20Report.pdf
“30 year fixed rate mortgage is now averaging 6.04%. The FOMC has to be pissed. This is NOT what they want.”
huh?
““30 year fixed rate mortgage is now averaging 6.04%. The FOMC has to be pissed. This is NOT what they want.”
huh?”
——————————–
Apparently Sabrina thinks that 6.04 is the new 3.5 or less, and is therefore cheap money.
As long as she doesn’t think Bucktown goes South of Armitage, I don’t care.
“Apparently Sabrina thinks that 6.04 is the new 3.5 or less, and is therefore cheap money.”
Homebuilders have all said that rates in the 5s will really bring out the buyers, although they have already shown up in the low 6s. Homebuilders are also buying down the loans so that buyers can get 3% again too. Lol.
But mortgage rates in the 5s with 3.5% unemployment is NOT what the Fed wants. They will stay tight for longer now.
Are these the same home builders that saw cancellation rates as high as 68%?
“Are these the same home builders that saw cancellation rates as high as 68%?”
—————————-
Only at 6.05 AND South of Armitage.
“Are these the same home builders that saw cancellation rates as high as 68%?”
No one has seen a cancellation rate as high as 68%.
Are you talking about the one that had a cancellation rate as a percentage of gross orders of 68%? That builder? That’s a different metric than a “cancellation rate of 68%”. Gross orders, by the way, down 47% to 2169 from 4072 for that builder.
I don’t think anyone is surprised that many who put in orders a few months ago are now bagging out. When layoffs rise, it will slow even further.
Yeah, orders are WAY down with rates so high. But the buyers are adjusting to this new norm. And the home builders are doing rate locks now. Many are building more specs as well because they know that buyers are eager to close quickly, before rates rise further. It’s counter intuitive. You’d think they’d build less specs, not more. But the demand is still there, just not for a house to be completed a year from now.
The most recent existing home sales report looked a bit better than expected (for the full country).
“The most recent existing home sales report looked a bit better than expected (for the full country).”
Buyers are adjusting to the rates. Not as much of a shock now. And unemployment is still 3.5%.