Chicago Market Update 2024
Think higher interest rates always mean lower home prices? Think again. While interest rates climbed, home prices in some Chicagoland zip codes actually rose. However, not all zip codes have faired the same, and some are rapidly declining.
In this blog, we will give you the scoop on the latest Chicago Real Estate news for you to use and gain knowledge. If this is your first time in our website, here -- we don't only track all zip codes in Chicagoland we also provide the very best of Chicago living as well.
If you are a buyer, possible seller or a realtor looking for the latest info, this blog is for you. Without further ado, let's cover the latest and greatest and those making headlines.
First, let's talk about something that really matters but isn’t very fun to talk about. If you're looking to buy a home in Chicagoland, interest rates and the Federal Reserve have a lot to do with it. In November, there wasn't any change in federal rates; however actual mortgage interest rates have been declining since their peak in late October.
Here's the scoop on inflation: it's starting to ease up a bit, mainly because energy costs have decreased. But the cost of housing is still pushing inflation up, and that's a big deal for us in the real estate world.
Now, let's zero in on Chicagoland's housing market. It's been pretty steady lately, much like last year. But there's something new: more sellers are dropping their prices. Which could mean the market might start to cool down a bit.
The big challenge is Affordability. Mortgage rates have gone up, from 6.5% to 7.2% for a 30-year loan. That's a big jump, and it makes buying a home tougher. However, some intelligent buyers look for more affordable areas or different loan options to find their dream home.
If you're waiting for rates to drop to buy a house, you should reconsider. Buyer bargaining power decreases as demand rises.
Let's face it: if you are starting off, buying a home today is more complex than it used to be. It's simply harder to afford a home today vs. previous generations. We've been navigating a market with a really low inventory for the past decade. This has made things more challenging for the average person looking to buy a home. Specifically millennials that still haven't entered the market.
To give you a clear picture, consider this:
A mortgage payment that costs you $1,700 today would have been just $1,100 a year ago. That's a big leap, and it shows just how much more expensive it's become to buy a home today.
But, with new challenges come new opportunities. This year, we've seen some savvy homebuyers find creative ways to own their dream home. We're talking about negotiating closing costs, big repairs, and even buying down points to lock in rates as low as 5%.
There are also some great new lending programs out there.
For example, the 1% down payment program which comes with a 2% forgivable grant. There's also a points buy-down program and a new 5% down payment option for multi-unit properties, which is perfect for investors looking for rental income.
Now, if you're curious about Illinois's down payment assistance programs, check out ourthat dives into that.
Yes, affordability is a huge issue. But let's not forget that renting isn't getting any cheaper either. Remember, when you pay rent, that money's gone for good. But buying a home? That's an investment in your future.
While the market might seem daunting, there are still paths to homeownership in today's market.
Chicago Vs. USA
When we look at the real estate landscape, it's fascinating to compare Chicago and its Collar Counties with the rest of the USA. This past year has been a rollercoaster for many markets, but Chicago's story stands out for a few key reasons.
Firstly, despite rising interest rates, we've seen increased home sale prices. Why? Because affordability is a major driver here. Chicago is what we call a 'linear market' – it's consistent and dependable. We're known for our slow and steady growth, a reassuring 'always up' trend.
But here's where the contrast with other U.S. cities comes in. Markets that soared during the pandemic like Arizona, Austin and most of Texas are now seeing price corrections – Austin's down almost 10%, and New Orleans by 9%. And it's not just them. Cities like Las Vegas, Phoenix, Nashville, Memphis, and Denver are also experiencing depreciating home values.
So, what does all this mean for you? If you're looking for value, the Midwest offers the best bang for your buck, especially near Chicago. You're close to the third-largest city in the United States, yet the affordability and value here are unmatched. Chicago ranks 12th in home price appreciation among states in the last year but still offers the 4th most affordable to buy a home.
Chicago and Its Collar Counties
When it comes to real estate in Chicagoland, very similar to the national story, the driving factor is affordability. It's interesting to see how this has shaped the desirability of various markets. The trend is clear: the most sought-after areas are those a bit farther from the city center, where land is more affordable, and newer construction is plentiful.
Breaking down the numbers. Cook County has shown a steady trend with no significant change in sales prices. But here's where it gets intriguing – all other surrounding counties have seen an uptick in their sales prices. This is a story of changing preferences and evolving housing trends in Cook County.
In Chicago, some zip codes are still struggling due to the pandemic's impact, the flight to suburbs, and high city taxes.
This has created a unique scenario – multi-million dollar properties in the city are now more accessible than ever. For the bold and the brave, this presents an incredible opportunity, as not all areas in Chicagoland have appreciated equally. As they say, When they Zig you Zag.
But, the story doesn't end there. With the rise of remote and hybrid work models, which seem set to continue, living a bit further from the office has become more viable than ever. This shift in work culture has opened new doors for homebuyers, allowing more flexibility and choice in where to call home.
Want to know how your zip code compares to the others? Click on the link see the full list of zip codes.
Zip Codes to Watch
When it comes to real estate in Chicagoland and anywhere else in the world, it's all about location, location, location. This is a dynamic market, where specific zip codes are making waves – for better or for worse. We've been tracking every zip code in the area, and I'm excited to share some of the standout performers and those who have faced challenges.
Before we dive in, let's set the stage with a quick disclaimer: Our market has seen historically low inventory, which affects everything. The facts and figures I'm about to share are accurate, but remember, not every house or price range in the same zip code behaves the same way.
It's always a good idea to talk specifics with a licensed real estate pro – and hey, if you want to chat about your situation, just book a time in my calendar.
Now, let's talk about the zip codes that are outshining the rest.
Highlighting the zip codes in Chicagoland that are setting the bar with soaring property values, thriving communities, and ample homebuyers.
Let's start with #1 Clarendon Hills. This gem has seen a remarkable 18.6% increase in property values over the past year, with single-family homes jumping an impressive 31%. But here's the kicker: the new median list price is $600,000. For a quaint, family-friendly town like Clarendon Hills, with just 12,000 residents, that's a steal IMO.
And It's not just about the numbers; this town has won multiple awards for its quality of life and schools. If Clarendon Hills is new to you, check out our 'Living in Clarendon Hills' video for an in-depth look.
Clarendon Hills, Illinois Market Report
Includes average property values, inventory, market changes, and demographic data.Homes for Sale in Clarendon Hills
Moving on to #2, Schaumburg – a picturesque wonderland in Northwest Cook County. It's a vibrant village with a unique urban-suburban mix, bustling with restaurants and a strong sense of community. Of course who can forget one of the largest indoor malls in the state is in Schaumburg. Schaumburg's allure is undeniable, with a striking 18% increase in single-family home values over the past year. This place isn't just a good choice; it's a favorite among those looking for the best in Illinois living.
But there's more. The second cities of the last century like Joliet, Aurora, and Elgin are experiencing a renaissance. Driven by affordability, these locations have recorded over a 10% increase in property value year over year. It's a trend that's redefining these historic cities as modern, affordable hotspots for homeowners.
And we can't forget other notable areas that have outshined the market. Places like Mundelein, Wilmette, Waukegan, Pingree Grove, Lake Zurich, Naperville, Plainfield, and Lincolnwood. Each of these locations offers something special, from bustling downtowns to serene suburban settings.
Market Research Includes average property values, inventory, market changes, and demographic data.
Schaumburg, Illinois Market Report
Includes average property values, inventory, market changes, and demographic data.Homes for sale in Schaumburg
In our journey through Chicagoland's diverse real estate landscape, it's important to also shine a light on the zip codes that haven't fared as well. These areas offer us valuable insights and remind us that all real estate markets are different.
First off is the loop- The Loop in Chicago has returned to pre-pandemic values despite the low-interest rates of 2021 and 2022. During my recent visit, I was pleasantly surprised to see the smiling faces of public workers and residents, which is a testament to the area's enduring spirit. With our ongoing efforts to improve safety, we are optimistic that there will be a turnaround from the current -7.7% decrease in median sale prices this year.
Next on our list is Oak Park. Ranked as the 19th best place to live in Illinois and boasting an overall A+ score from niche.com, it's surprising to see a -7.7% decrease in sales prices here. The higher crime rate could be a factor, despite the area's prime location and amenities. Oak Park's proximity to Chicago, a city facing its own challenges, might also be influencing this trend.
Evanston, known for its progressive values and home to Northwestern University, presents a mixed picture. While the city overall is up by just 0.3%, certain zip codes within Evanston have seen rapidly declining property values. This highlights the nuanced nature of real estate, where one part of a city can experience a different trend from another.
Other areas facing headwinds include Frankfort, Willowbrook, Bensenville, The South Shore, and the Near North Side in Chicago. Each of these areas has its unique challenges and stories.
In real estate, knowledge is power, and being informed about both the highs and lows of the market is key to making wise decisions. Remember, I'm here to help you navigate these complexities. Whether you're looking at an up-and-coming area or one facing challenges, let's explore your options together and find the right path for your real estate journey in Chicagoland.
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Posted by Rafael Velasco on