Chicago, the 3rd largest city in the USA is also one of the most balanced economies of the country. Home to a workforce of around 4.8 million, Chicago’s is boastful of a vibrant real estate industry. Although the real estate in Chicago has mostly traversed up the curve, its real estate sentiments got a biting during the global economic crisis as shown in the property price index
Nevertheless, in lock with economic recovery in US economy, the realty market has started demonstrating strong sentiments once again, with an average median price of properties increased by 21% in the last 6 months.
The positivity in the Chicago Real Estate Market could be explained on the basis of following factors.
As mentioned above, Chicago is touted as a well-balanced economy with a large volume of new employments generated in various sectors such as technology, media, industrial, hospitality, healthcare & social assistance.
Chicago enjoys a high median income of over USD 44,000. The present job market stands at over 4.8 million & is higher than the peak period of July 2007. The unemployment is below 5%, equal to 2006-07.
Higher per capita income & high rate of employment is feeding demand for residential units.
Along with China, Europe & Middle East, Chicago also draws interest from real estate investors from Mexico & India.
The present Chicago’s real estate market has a tighter demand-supply with supply getting further tighter with time, thereby resulting in price appreciation.
A buoyant job market is also translating into bullish commercial sectors with over 900,000 Sq. Ft of office space absorbed in Q2 2016.
The growth of real estate in Chicago has also been closely linked to its robust transit line named, Chicago L, with a daily ridership of over 750,000 & a spread of over 165 KMs.
In the times to come, Chicago will undertake a multi-pronged approach to boost its existing infrastructure with the extension of the Downtown area.
Chicago real estate is also considered to be relatively more affordable when compared to other cities in the USA. In Chicago the monthly average expenditure on home mortgages is in tune of 8.5%, that is much smaller when compared to the national average of 14.5%.
Along with traditional asset classes, other innovative product types such as off-market products & co-working space catching up fast with the investor fraternity.
Excerpt from the Chicago Property Snapshot.