Chicago Real Estate Market Sales | 2017-2018 Zenlist

Every city has its own unique real estate market, and Chicago is no different.

We took a look at the last few months of data and found some pretty interesting changes going on in the Windy City – even some that buck national trends. From a surplus of inventory to a penchant for expensive areas and detached homes, Chicago’s buyers are paving their own way in today’s housing market.

New listings are outpacing sales by a big margin

We hear a lot about housing inventory being low, but it seems that’s far from true in Chicago. According to 2017’s data, only about half of the city’s listed properties sold last year. Out of a whopping 61,245 listings, a mere 33,001 sold – just over 53 percent.

And it seems that trend is likely to continue, too. Over the last five years, the number of sales has grown just 5 percent. New listings? Those jumped 22 percent.

The trend is a curious one, especially as much of America faces a severe dearth of homes on the market. Continuing population loss in the city could certainly play a role. Out of the nation’s biggest cities, Chicago experienced the greatest drop in population in 2017, losing about 20,000 residents over the course of the year. It marked the second consecutive year the city netted a loss.

There’s no shortage of detached properties

If you’re on the market for a detached property, you’re definitely in luck; Chicago appears to have them in spades.

Over the past five years, detached property listings have jumped a whopping 25 percent. Demand isn’t keeping up though; sales on detached properties notched up a mere 4 percent for the same period. And in 2017? They rose only 2 percent.

Meanwhile, new listings on attached/condo and multi-unit properties are keeping on point with demand. It begs the question: with all this inventory available, could prices on detached properties soon be on the downturn? Only time will tell.

The best-selling neighborhoods are also the most expensive

Chicago’s most popular neighborhoods certainly aren’t that way for their bargain-basement prices. In fact, many of the city’s top spots are also its costliest.

Take Near North Side, for example. The community claimed the title for most properties sold, but its average price is in the budget for very few. For 2017, the median sales price in the neighborhood was a shocking $1.075 million. This number’s likely influenced by a handful of detached properties in the area, which tend to go for around $1.9 million each. The average condo in the area is just $405,000.

Lincoln Park is another similar region, taking a top-five ranking for most sales and also claiming an average median sales price of $999,000. Detached homes in the area run for a cool $1.58 million, and 200 of those were sold there last year. The neighborhood also has the city’s most expensive condos, averaging about $490K each.

A little pro tip? If you’re interested in either of these communities but don’t have pockets deep enough, you may want to lean toward Near North Side. The average property sold for 31 percent under its listing price last year, so there may be a little wiggle room when it comes to price.

 

Chicago Real Estate Market 2018

Chicago Real Estate Market 2018

The Chicago real estate market is big. Really, really big.

With more than 70 neighborhoods, a wide array of property types and plenty of hungry buyers, it’s one of the nation’s most robust and competitive markets out there.
But that doesn’t mean it’s inaccessible.
Whether you’re on the hunt for your first home or you’re a serial real estate investor looking to expand your portfolio, 2018 might still be your year. We’ve analyzed the last year of local real estate sales, and trends indicate now may be the time to buy – at least for some.

What 2017 Stats Mean for Buyers this Year

Prices are up – but not by that much.

You hear a lot about the ever-rising prices of the American housing market. But here in Chicago, average home prices are still below their record highs. In fact, prices on detached properties stands at 89 percent of what they were in 2007, and attached houses are still at 82% percent. Last year, there was actually a slowdown in growth on single-family detached properties (meaning now may be the time to buy one if you’re on the market!).

If you’re ready to buy, you’ll need to act quickly.

Properties are selling fast, and the average days a property stays on the market has been steadily dropping. Attached single-family homes have seen a 19 percent dip in days on market since 2016, and multi-unit properties have dropped 13 percent. Attached units are also on a slow decline – and have been since 2011. The moral of the story? If you see a property you like, act fast; it won’t be on the market long.

The listing price is probably negotiable.

Unlike in many metro areas, Chicago homes are actually going for under their listing price. Single family detached and attached homes show the biggest differential, selling for about 4 percent under their listed price, while multi-unit properties had a 2 percent one, meaning they’re going for a little closer to listing price than other properties. Either way, this means you likely have a little room to negotiate – no matter what type of property you’re buying. This is also the first year multi-unit properties are selling below listed price in the last 5 years.

Condos, duplexes and attached homes are a hot commodity – at least for today.

A big chunk of properties sold last year were attached homes, meaning condos, duplexes and the like. Detached homes came in second, while multi-units came in third. There was also more inventory in the attached space in 2017, with fewer on the multi-unit end.
This indicates it could be a good time to buy an attached property – but only for now. Data shows prices on single-family attached homes are growing faster than other housing types in the Chicago market. You’ll want to get in before the differential between listing price and sales price starts to tighten even more.

Get your detached house now.

If you’re on the market for a detached home, you also may be in luck. This type of properties move slowly, and their prices aren’t rising like other housing options. Still, new listings are stable for attached homes, so you’ll want to act fast. As listings will start to dwindle and demand rises, buyers will lose bargaining power when it comes to price.

Neighborhood matters.

Chicago is home to nearly 80 different neighborhoods, and let me tell you: they’re definitely not created equal. Each offers different pros and cons, as well as unique levels of competition, supply and pricing. If you’re not looking to spend an arm and a leg on your property, you’ll probably want to avoid the city’s most expensive neighborhoods: Lincoln Park, Near North Side and Lake View. Lincoln Park came in with an average sale price of $1,174K for 2017, while Near North Side wasn’t much less at $1,135K. If you’re going for a detached single-family home, you’re looking at an average of $1.83 million or $1.86 million, respectively.
Lake View was slightly more affordable overall, with an $899K average price. Single-family properties in this neighborhood ran a cool $1.32 million in 2017.

Price aside, Chicago neighborhoods also vary greatly by time on market, meaning where you buy will play into how fast you need to act. In the Lower West Side community, houses sell the fastest at just 52 days on the market. The neighborhood also has a very small spread between listing price and sale price, indicating the market is pretty competitive at the moment.
Near West Side and Archer Heights also see properties fly off the market at just 54 and 56 days on market. Still, if you can get in fast, Near West Side is a great buy. Attached homes sell for about 10 percent below listing price.

North Park offers the deal of the year.

When looking at Chicago real estate market, for a true steal, look to North Park. Though homes average about 67 days on market (slightly higher than the record-holding neighborhoods, but much lower than the city’s average of 90), they’re also going for a whopping 30 percent below list price. Plus, looking at new listings versus properties sold, it appears there’s still plenty of inventory on the market – including many single-family, detached homes.

When To Use The Median Home Price vs Average Home Price | Zenlist’s Real Estate Market Guides

When To Use The Median Home Price? When To Use The Average Home Price?

Both median home price and average home price are pulled from the same set of numbers, but the two are usually very different – both in number and meaning.

While median represents the middle-of-the-pack price – what a home right in the center of a market’s offerings would cost – the average is a bit different. Instead, the average home price refers to the mean price of homes in an area, once added together and averaged out.

In our earlier example, the average home price would be calculated like by adding all home prices: $246,000 + $299,000 + $384,000 + $406,000 + $1,000,000 = $2,335,000. You would then divide that by the number of data points in the set (5, in this case), to get the average home price: $467,000.

As you can see, the average price is actually $83K more than the median home price, even though it uses the same data. Here’s a graphic that spells out just how different median and average prices can be for the same area:

The Benefit of Using Each

The average price is best used in situations where the dataset is evenly distributed – with plenty of numbers on the higher, middle and lower-cost end contributing to it. If it’s used in a smaller set, it can often be skewed by extreme prices on of either end of the spectrum.

The median home price, on the other hand, is a great choice when data sets are small and not evenly distributed, as it’s not impacted by extreme numbers. It’s also a better option when looking for the price of a “typical” home in an area, as it’s harder to skew with the occasion million-dollar home sale or bargain-basement foreclosure.

The important thing to note is that median home price and average home price can be quite different – particularly if prices aren’t evenly distributed. Make sure you know what type of data is being used before you take either number into account in your home search.

More on this topic:

 

What Is The Median Home Price? | Zenlist’s Real Estate Guides

The median home price is the price in the middle of the dataset when you arrange all the home prices from low to high.

If you’re researching potential properties or just dipping your toes in the housing market, you’ve likely heard the term “median home price” thrown around. But what does it mean and when should you consider it important?

In any dataset –  whether it’s home prices or grades in a classroom – “median” refers to the number located in the very middle of the set (when arranged from lowest to highest.) As an example, let’s say homes sold in Chicago today came in at:

 

  •       $246,000
  •       $299,000
  •       $384,000 <= median
  •       $406,000
  •       $1,000,000

 

The number $384,000 – which is situated right in the middle of the list – would be the median home price. Generally, median home prices are used in conjunction with average home prices to give a full picture of a local housing market. The two terms might sound similar, but they actually have quite different meanings when it comes to setting price expectations for an area.