FEBRUARY 2023 MARKET ANALYSIS FOR CHICAGO'S NORTH SIDE
2023 began with decreasing year over year homes sales in January for the eleventh consecutive month in Lincoln Park, Near North Side, Lakeview and North Center.
Low inventory levels continue to be the major obstacle to a real estate turn around. Rising taxes, crime and stock market losses are just a few of the contributing factors of this down turn; however, high interest rates are the main culprit. They are keeping both buyers and sellers on the sidelines. There are very few homes on the market for buyers and most sellers would be looking at moving from a 3% mortgage interest rate on their current home to over 6% for a new home.
While the Fed is raising interest rates in order to fight inflation, it is having a negative affect on the real estate market. It is too early to know if the economy is going to make a “soft landing” or go into a recession in 2023. Some economists feel that we will go into a shallow rather than a deep recession. This will mean less unemployment and other hardships, but interest rates will probably remain high for a longer period of time. There is good news that unlike the downturn in 2008, personal debt is generally low and savings are relatively strong. This could result in a fast turn around once the Fed begins to relax interest rates and inventories begin to rise.
We have experienced dramatic highs and lows in North Side Real estate in the past three years, from the COVID crash of 2020 to the record breaking rebound in 2021 and back to a more normal market in 2022. The first 6 months of 2023 may continue to show decreases when compared to 2022. As a result, we will continue to compare 2023 to 2022 and 2019 (the last “normal year before COVID”) in our analysis below. There are a significant amount of homes being sold and comparing 2023 to 2022 and 2019 gives a more balanced picture of the current market.
Please review the analysis below for your neighborhood and price point to see for yourself how they are performing. Each section below has a button that provides additional monthly, year to date and 10 year trends. Chicago is a big complicated city and so is the real estate market. There is no “one size fits all.” Buyers and sellers should look at market statistics for their individual neighborhood, property type and price point to get accurate data.
JANUARY HOME SALES
Year To Date 2023 vs 2022 - Down 44.3 %
Year To Date 2023 vs 2019 - Down 11.3%
Month 2023 vs 2022 - Down 44.3%
Month By Neighborhood
NEAR NORTH - Down 29.7%
LINCOLN PARK - Down 64.2%
LAKEVIEW - Down 51.5%
NORTH CENTER - Down 30.0%
Month By Price Point
Under $500,000 - Down 45.6%
$500,000 to $1,000,000 - Down 40.3%
$1,000,000 to $2,000,000 - Down 51.8%
Over $2,000,000 - Down 50.0%
JANUARY HOMES UNDER CONTRACT
Year To Date 2023 vs 2022- Down 32.9%
Year To Date 2023 vs 2019 - Down 2.4%
Month 2023 vs 2022 - Down 32.9%
Month By Neighborhood
NEAR NORTH - Down 22.3%
LINCOLN PARK - Down 48.8%
LAKEVIEW - Down 39.9%
NORTH CENTER - Down 1.8%
Month By Price Point
Under $500,000 - Down 26.2%
$500,000 to $1,000,000 - Down 39.6%
$1,000,000 to $2,000,000 - Down 38.5%
Over $2,000,000 - Down 43.3%
Noteworthy : Most home sales that closed this month went under contract in a previous month. Units Under Contract reflects a more accurate picture of the current month, although not every home that goes under contract closes.
JANUARY HOMES FOR SALE
Year To Date 2023 vs 2022- Down 20.2%
Year To Date 2023 vs 2019 - Down 32.9%
Month 2023 vs 2022 - Down 20.2%
Month By Neighborhood
NEAR NORTH - Down 16.2%
LINCOLN PARK - Down 26.9%
LAKEVIEW - Down 32.5%
NORTH CENTER - Up 7.8%
Month By Price Point
Under $500,000 - Down 36.3%
$500,000 to $1,000,000 - Down 9.6%
$1,000,000 to $2,000,000 - Down 4.6%
Over $2,000,000 - Up 0.1%
JANUARY MONTHS OF SUPPLY OF INVENTORY
Year To Date 2023 vs 2022 - Up 0.4% to 2.4 MSI
Year To Date 2023 vs 2019 - Down 40.0% to 2.4 MSI
Month 2023 vs 2022 - Up 0.4% to MSI
Month By Price Point
Under $500,000 - Down 15.0% to 1.7 MSI
$500,000 to $1,000,000 - Up 15.0% to 2.3 MSI
$1,000,000 to $2,000,000 - Up 31.3% to 4.2 MSI
Over $2,000,000 - Up 31.6% to 7.5 MSI
Month By Neighborhood
NEAR NORTH - Up 2.3% to 4.5 MSI
LINCOLN PARK - No Change at 1.8 MSI
LAKEVIEW - Down 11.8% to 1.5 MSI
NORTH CENTER - Up 41.7% to 1.7 MSI
Noteworthy - Traditionally, MSI over 7.0 designates a buyer’s market and under 6.0 a seller’s market. Between 6.0 & 7.0 is considered a neutral market.
JANUARY MEDIAN PRICING
Year To Date 2023 vs 2022- Down 2.0%
Year To Date 2023 vs 2019- Up 3.1%
Month 2023 vs 2022 - Down 2.0%
Month By Neighborhood
NEAR NORTH - Down 13.8%
LINCOLN PARK - Down 18.6%
LAKEVIEW - Up 19.9%
NORTH CENTER - Up 10.9%
Month By Price Point
Under $500,000 - Down 6.4%
$500,000 to $1,000,000 - Down 2.7%
$1,000,000 to $2,000,000 - Down 9.4%
Over $2,000,000 - Up 5.7%
JANUARY DAYS ON THE MARKET
Year To Date 2023 vs 2022- Down 11.3% to 94 Days
Year To Date 2023 vs 2019- Down 19.6% to 117 Days
Month 2023 vs 2022 - Down 11.3% to 94 Days
Month By Neighborhood
NEAR NORTH - Down 24.1% to 126 days
LINCOLN PARK - Down 11.5% to 85 days
LAKEVIEW - Down 34.7% to 47 days
NORTH CENTER - Up 16.2% to 79 Days
Month By Price Point :
Under $500,000 - Down 9.9% to 91 Days
$500,000 to $1,000,000 - Down 15.6% to 86 Days
$1,000,000 to $2,000,000 - No Change at 120 Days
Over $2,000,000 - Down 35.3% to 167 Days
YOUR HOME
A logical question would be “how does all of this affect the home that I am planning to sell or potentially buy?”
Every home is unique and a detailed analysis of your property and neighborhood is a necessity to fully understand the true market value and whether this is the right time to buy or sell.
There are many criteria both objective and subjective that must be analyzed in order to get a true picture.
Internet home pricing sites that claim to calculate your home’s value using only algorithms can be wildly inaccurate. Many market analysis from real estate agents that have not taken the time to personally tour the home can also be seriously flawed. Today’s volatility demands that you get a broker who thoroughly understands this rapidly changing market.
Whether you are buying or selling a home, I would welcome the opportunity to have a conversation about your real estate needs, goals and expectations.