APRIL 2023 MARKET ANALYSIS FOR CHICAGO'S NORTH SIDE
March 2023 was the 13th consecutive month of year over year home sales declines in Lincoln Park, Near North Side, Lakeview and North Center.
Historically low inventory levels and rising interest rates continue to be the two major obstacles to a real estate turn around; however, rising taxes, crime, unemployment and stock market losses have all contributed to this complex market.
Based on our analysis below, there seem to be four interesting trends emerging from this market.
1 - Market Perception : From a strictly analytical standpoint, home sales for the past 13 months have been extremely disappointing when compared to the previous year. We have experienced dramatic highs and lows in the past four 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 have been comparing 2023 to both 2022 and 2019 (the last “normal year before COVID”) in our monthly analysis. While comparisons to 2021 & 2022 show decreases, comparisons to 2019 are much more positive and show that there are still a significant amount of homes being sold.
2 - Home Prices: Traditionally, low inventory markets can inflate home prices to dangerous levels for home buyers. Despite many multiple offers and low market times, Chicago home prices have remained fairly stable in comparison to other parts of the country. Last month home prices dropped 1.2% against last year. There are still a lot of homes being sold and most reflect reasonable market value and not an inflated number forced by low inventory.
3 - Interest Rates : The panic of triple digit interest rate increases is beginning to subside a bit. While interest rates are affecting most buyer demographics , many younger home buyers have known nothing but interest rates in the low 3% and have been in a state of shock when facing rates between 6% and 7% and higher. It appears that these higher interest rates are going to be with us for a while. While higher rates do affect buying power, buyers are realizing that they are not married to their mortgage and they can always refinance when rates drop.
4 - Rent Vs Sell: We are noticing that some homeowners are renting their homes rather than selling. These homes usually have mortgages in the high 2% to low 3%. With rental prices rising they can represent an income producing investment and hedge against inflation. Homeowners, however, need to be aware of all aspects of being a landlord before they take on this responsibility. Renting homes vs selling them will keep sales inventories lower, but it is a positive sign of confidence that homeowners have about Chicago real estate.
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.
MARCH HOME SALES
Year To Date 2023 vs 2022 - Down 35.8%
Month 2023 vs 2019 - Up 8.2%
Month 2023 vs 2022 - Down 29.9%
Month By Neighborhood
NEAR NORTH - Down 26.0%
LINCOLN PARK - Down 37.5%
LAKEVIEW - Down 34.8%
NORTH CENTER - Down 7.7%
Month By Price Point
Under $500,000 - Down 33.6%
$500,000 to $1,000,000 - Down 34.3%
$1,000,000 to $2,000,000 - Down 15.4%
Over $2,000,000 - Down 30.7%
MARCH HOMES UNDER CONTRACT
Year To Date 2023 vs 2022- Down 36.6%
Month 2023 vs 2019 - Down 21.8%
Month 2023 vs 2022 - Down 40.4%
Month By Neighborhood
NEAR NORTH - Down 29.6%
LINCOLN PARK - Down 38.3%
LAKEVIEW - Down 47.6%
NORTH CENTER - Down 57.5%
Month By Price Point
Under $500,000 - Down 52.8%
$500,000 to $1,000,000 - Down 36.5%
$1,000,000 to $2,000,000 - Down 49.4%
Over $2,000,000 - Down 34.1%
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.
MARCH HOMES FOR SALE
Year To Date 2023 vs 2022- Down 23.0%
Month 2023 vs 2019 - Down 43.3%
Month 2023 vs 2022 - Down 27.6%
Month By Neighborhood
NEAR NORTH - Down 21.1%
LINCOLN PARK - Down 37.2%
LAKEVIEW - Down 42.1%
NORTH CENTER - Down 16.1%
Month By Price Point
Under $500,000 - Down 48.6%
$500,000 to $1,000,000 - Down 13.9%
$1,000,000 to $2,000,000 - Down 5.9%
Over $2,000,000 - Up 2.0%
MARCH MONTHS OF SUPPLY OF INVENTORY
Year To Date 2023 vs 2022 - No Change at 2.6 MSI
Month 2023 vs 2019 - Down 45.8% to 2.6 MSI
Month 2023 vs 2022 - No Change at 2.6 MSI
Month By Price Point
Under $500,000 - Down 33.3% to 1.6 MSI
$500,000 to $1,000,000 - Up 21.7% to 2.8 MSI
$1,000,000 to $2,000,000 - Up 42.9% to 5.0 MSI
Over $2,000,000 - 38.8% to 9.3 MSI
Month By Neighborhood
NEAR NORTH - Up 4.1% to 5.0 MSI
LINCOLN PARK - Down 10.0% at 1.8 MSI
LAKEVIEW - Down 15.0% to 1.7 MSI
NORTH CENTER - Up 18.8% to 1.9 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.
MARCH MEDIAN PRICING
Year To Date 2023 vs 2022- Down 4.2%
Month 2023 vs 2019- Up 7.3%
Month 2023 vs 2022 - Down 1.2%
Month By Neighborhood
NEAR NORTH - Up 10.6%
LINCOLN PARK - Down 12.0%
LAKEVIEW - Up 1.4%
NORTH CENTER - Down 1.1%
Month By Price Point
Under $500,000 - Up 0.1%
$500,000 to $1,000,000 - Down 0.1%
$1,000,000 to $2,000,000 - Up 2.4%
Over $2,000,000 - Down 19.0%
MARCH DAYS ON THE MARKET
Year To Date 2023 vs 2022- Down 4.2% to 92 Days
Year To Date 2023 vs 2019- Up 15.5% to 92 Days
Month 2023 vs 2022 - Up 3.3% to 92 Days
Month By Neighborhood
NEAR NORTH - Down 2.8% to 137 days
LINCOLN PARK - Down 7.1% to 91 days
LAKEVIEW - Down 1.3% to 75 days
NORTH CENTER - Up 60.0% to 64 Days
Month By Price Point :
Under $500,000 - Up 3.8% to 81 Days
$500,000 to $1,000,000 Up 6.7% to 95 Days
$1,000,000 to $2,000,000 - Down 12.4% to 106 Days
Over $2,000,000 - Down 21.8% to 151 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, we would welcome the opportunity to have a conversation about your real estate needs, goals and expectations.