Bisnow reports that Chicago and its outlying areas are seeing robust home sales in the first months of 2021—not just in the single-family market, but in condos as well.
The outlet cites a report from the Chicago Association of Realtors (CAR), which indicates that the 1,684 homes sold in January, including condos and single-family dwellings, were a 15.2% increase over the same month last year. With so much activity, prices are going up as well. The median sales price of a Chicago home in January was $310,000—a 15.9% jump over January 2020, the outlet notes.
The trend seems to be continuing as spring begins and the concerns that hampered real estate activity last year wane.
A Look Back
Chicago’s home sales market took a heavy hit last year when COVID put the city on lockdown and episodes of civil unrest followed after the Minneapolis police killing of George Floyd in May. According to CAR data, 1,666 Chicago homes sold in May 2020—a 43.6% decline from May 2019.
Downtown high-rises were the hardest hit, Wolf says, with sales in that segment remaining sluggish as the year progressed. But recovery could be seen elsewhere, especially in mid-rises outside downtown; by October, 2,541 homes sold, according to Bisnow—a 21.9% increase over the previous October.
Now downtown is starting to return to form, too, especially at certain price points.
Condos After COVID
@properties executive vice president Cyndy Salgado says that the under-$1-million market is receiving particular interest, speculating that buyers in higher price points might have second homes where they are continuing to wait out the pandemic. “In general,” she says, “we’re starting to see people tiptoe back into the downtown condo market.”
Salgado indicates that interest is strongest for condo units with enough space for working and schooling at home, as well as those with outdoor amenities such as balconies and rooftop terraces. Such interest is in line with wider trends in all markets that seem to stem from the pandemic’s influence on home needs.
Even during Chicago’s historic stretch of days with snowfall this winter, Salgado says, four condo units sold at Alcove Wicker Park, a development with a rooftop terrace whose 42 condos—priced at about $600,000—include oversized balconies. “It really hits the sweet spot,” she says of the development, which also includes 12 townhomes and whose sales are being handled by @properties.
Supply Lags Demand
Wolf—who is optimistic about sales numbers for the rest of the year as vaccine administration ramps up and Chicago’s great restaurants, museums, and theaters might be able to reopen fully—says demand can only increase for condos under $1 million. The only problem? Lack of inventory.
“There is a lot of demand for condos in the $700K to $800K range, but what’s out there? Nothing,” he laments. According to Bisnow, the multifamily market was so strong for so many years that Chicago developers concentrated on creating apartments, leaving buyers few options. According to CAR, January’s supply of inventory was 3.4 months—a 2.9% decrease from January 2020, cites Bisnow.
Anyone having deconversion remorse?