SEPTEMBER 2021 MARKET ANALYSIS FOR CHICAGO'S NORTH SIDE
Overview - After the year’s first decrease in July, the North Side real estate market rebounded in August and September looks strong.
Cumulative August Home Sales and Homes Under Contract both increased over 10% vs 2020 in four key neighborhoods on the North Side. It should be noted, however, increases and decreases varied by neighborhood. (see analysis below)
Inventory levels and Months Of Supply Of Inventory continued to drop to near record lows and dramatically surpassed sales growth.
Traditionally sustained sales increases and inventory declines lead to large median price increases, but this has not been the case this year, as August posted a meager 2.8% increase.
Variables such as the second outbreak of COVID, rising crime and state and city financial problems (i.e. tax increases) are all having an affect on the real estate market. Unfortunately these variables have not been brought under control, so it is impossible to predict their continued impact on the Fall 2021 market
Despite this uncertainty, the market is healthy, but buyers and sellers need to know how to navigate this market.
Here are a few points to consider:
Condition of the property - many buyers are looking for homes in ‘turn key’ condition. This not only includes a fresh coat of paint, but a more contemporary look from the heavy moldings and dark woods of the early 2000’s. For sellers, updating can be less costly than a future price change. For buyers, many of the homes built in 2000 to 2010 that have been accumulating market time could represent a great value with some cosmetic renovations.
Pricing - the most crtical component in buying and selling in this market is price. Stories about low inventory levels and multi offers have many sellers believing that they can just throw a price out on the market and the home will sell. Competitive pricing based on comparative properties, price per squared foot and market appreciation is vital in selling your home. Testing an inflated price can lead to higher market times and potential costly price changes.
Mortgage Rates - while rates continue to fluxuate slightly from week to week, they are still hovering around 3%, with some great product for flexible down payments. This gives buyers tremendous buying potential.
Media Hype - there is (as always) a tremendous amount of information and misinformation about the real estate market. Much of this involves national or regional statistics that have little to do with individual buyers and sellers. Even Chicago statistics can be misleading as the city is so large, that individual neighborhood markets can vary considerably. It is critical to look at each neighborhood, property type and price point in order to get accurate market conditions.
Please see the analysis below for your neighborhood and how it is performing.
AUGUST HOME SALES
Year To Date - Up 57.0%
Month 2021 vs 2020 - Up 10.0%
Month By Neighborhood
NEAR NORTH - Up 43.1%
LINCOLN PARK - Down 7.0%
LAKEVIEW - No Change
NORTH CENTER - Down 4.1%
Month By Price Point :
Under $500,000 - Up 20.6%
$500,000 to $1,000,000 - Down 6.4%
$1,000,000 to $2,000,000 - Up 13.6%
Over $2,000,000 - Up 52.9%
AUGUST HOMES UNDER CONTRACT
Year To Date - Up 53.2%
Month 2021 vs 2020 - Up 10.6%
Month By Neighborhood
NEAR NORTH - Up 42.8%
LINCOLN PARK - Up 12.2%
LAKEVIEW - Down 9.1%
NORTH CENTER - Down 17.1%
Month By Price Point :
Under $500,000 - Up 14.4%
$500,000 to $1,000,000 - Down 4.9%
$1,000,000 to $2,000,000 - Up 28.1%
Over $2,000,000 - Up 55.0%
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.
AUGUST HOMES FOR SALE
Year To Date - Up 7.7%
Month 2021 vs 2020 - Down 27.6%
Month By Neighborhood
NEAR NORTH - Down 25.7%
LINCOLN PARK - Down 33.0%
LAKEVIEW - Down 27.3%
NORTH CENTER - Down 28.4%
Month By Price Point :
Under $500,000 - Down 25.4%
$500,000 to $1,000,000 - Down 31.3%
$1,000,000 to $2,000,000 - Down 31.9%
Over $2,000,000 - Down 19.1%
AUGUST MONTHS OF SUPPLY OF INVENTORY
Year To Date - Down 16.0% to 4.7MSI
Month 2021 vs 2020 - Down 49.3% to 3.8 MSI
Month By Price Point :
Under $500,000 - Down 48.4% to 3.3 MSI
$500,000 to $1,000,000 - Down 50.7% to 3.7 MSI
$1,000,000 to $2,000,000 - Down 55.9% to 4.9 MSI
Over $2,000,000 - Down 47.8% to 9.3 MSI
Month By Neighborhood
NEAR NORTH - Down 48.1% to 6.8 MSI
LINCOLN PARK - Down 56.6% to 3.0 MSI
LAKEVIEW - Down 50.0% to 2.9 MSI
NORTH CENTER - Down 44.4% to 2.5 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.
AUGUST MEDIAN PRICING
Year To Date - Up 4.0%
Month 2021 vs 2020 - Up 2.8%
Month By Neighborhood
NEAR NORTH - Down 5.4%
LINCOLN PARK - Down 14.7%
LAKEVIEW - Down 4.7%
NORTH CENTER - Up 38.8%
Month By Price Point :
Under $500,000 - Down 5.5%
$500,000 to $1,000,000 - Down 5.1%
$1,000,000 to $2,000,000 - Up 2.6%
Over $2,000,000 - Down 3.8%
AUGUST DAYS ON THE MARKET
Year To Date - Down 10.0 % to 89 Days
Month 2021 vs 2020 - Down 15.7% to 70 Days
Month By Neighborhood
NEAR NORTH - UP 13.7% to 133 days
LINCOLN PARK - Down 50.5% to 45 days
LAKEVIEW - Down 32.5% to 52 days
NORTH CENTER - Up 4.2% to 50 Days
Month By Price Point :
Under $500,000 - Down 68.5% to 98 Days
$500,000 to $1,000,000 - Down 21.5% to 62 Days
$1,000,000 to $2,000,000 - Down 40.4% to 99 Days
Over $2,000,000 - Up 3.2% to 162 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.