September 2019 & YTD Market Analysis For Chicago's North Side

OVERVIEW

August 2019 represented the 22ND consecutive month of home sale DECREASES aNd inventory increases on the Near North side, Lincoln Park, Lakeview & North Center. Buyers & sellers need to take a fresh look at how to navigate this changing market.

August 2019 vs 2018 - Home sales dropped 4.5% , while inventories rose 6.9%. This increased the months of supply of inventory 12.0% to 5.6 MSI. Median prices which are down slightly for 2019, dropped 4.3% in August, while market times increased 9.0% to an average of 72 days.

The most telling YTD numbers below are a 9.7% drop in home sales, an 11.3% increase in market time and a 20.5% increase in months of supply of inventory .

While the market remains relatively healthy, the dynamics continue to change as we move toward a balanced market between buyers and sellers. Breaking the North Side market into three price points reveals a number of different factors at play.

Homes Priced Under $500,000 - Record low inventories in this price point made it one of the most explosive during the post recession boom. In the past few years, the glut of luxury new construction rental buildings have lured many potential first time buyers into renting. While the current 3.9 months of supply of inventory is still seller friendly, it has increased almost three fold over the past few years. Falling home sales in this price point have been a major factor in 2019 YTD inventory increases of almost 18% over 2018.

Homes Priced Between $500,000 & $1,000,000 - This is a very active price point as many expanding families are looking for larger homes and better schools. Much of the new construction has shifted from single family homes to multi unit buildings to accommodate this demographic. The market for this price point does not seem to have benefited from this activity, as YTD sales are down 13.9% and inventories are up 17.7%.

Homes Priced Over $1,000,000 - This price point did not experience the explosive rebound from the recession of 2008 and suffered from a glut of new construction. As new construction of single family homes shifted to multi unit buildings, inventories began to drop and and single family home market numbers have improved over the past few years. Fear of rising property taxes along with the perception of rising crime; however, are causing some luxury buyers to look to the suburbs.

No need to panic at this point - While the narrative above may seem somewhat ominous, the market appears to be leveling out rather than tanking. No one like negative indicators: however, after the post recession bubble that so heavily favored sellers, a correction leading to a more balanced market between buyers and sellers is inevitable .


HOME SALES

August YTD 2019 vs 2018 - Cumulative Home Sales - Down 9.7%

By Neighborhood

NEAR NORTH - Down 14.3%

LINCOLN PARK - Up 1.6%

LAKEVIEW - Down 13.4%

NORTH CENTER - Down 3.0%

By Price Point :

Over $1,000,000 - Down 3.0%

$500,000 to $1,000,000 - Down 13.9%

Under $500,000 - Down 9.0%

Noteworthy - Despite a cumulative drop of 9.7 % in sales for the past six months, Lincoln Park reported a 1.6% increase


HOMES UNDER CONTRACT

August YTD 2019 vs 2018 - Cumulative Homes Under Contract - Down 7.0%

By Neighborhood

NEAR NORTH - Down 12.9%

LINCOLN PARK - Up 4.7%

LAKEVIEW - Down 10.6%

NORTH CENTER - Up 2.0%

By Price Point :

Over $1,000,000 - Down 7.1%

$500,000 to $1,000,000 - Down 8.3%

Under $500,000 - Down 6.2%

Noteworthy : Most home sales that closed in August went under contract in a previous month. Units Under Contract can reflect a more accurate picture of the current month, although not every home that goes under contract closes.  


HOMES FOR SALE

August YTD 2019 vs 2018 - Cumulative Homes For Sale - Up 11.9%

By Neighborhood

NEAR NORTH - Up 9.5%

LINCOLN PARK - Up 17.7%

LAKEVIEW - Up 17.1%

NORTH CENTER - Down 3.5%

By Price Point :

Over $1,000,000 - Down 4.4%

$500,000 to $1,000,000 - Up 17.1%

Under $500,000 - Up 17.7%


MONTHS OF SUPPLY OF INVENTORY

August YTD 2019 vs 2018 - Cumulative MSI - Up 20.3% to 5.3 MSI

By Neighborhood

NEAR NORTH - Up 24.1% to 7.2 MSI

LINCOLN PARK - Up 25.6% to 5.4 MSI

LAKEVIEW - Up 26.5% to 4.3 MSI

NORTH CENTER - No Change at 4.3 MSI

By Price Point :

Over $1,000,000 - Up 8.0% to 9.5 MSI

$500,000 to $1,000,000 - Up 26.0% to 5.8 MSI

Under $500,000 - Up 30.0% to 3.9 MSI

Noteworthy: Traditionally, MSI over 6.0 designates a buyer’s market and under 6.0 a seller’s market. 


MEDIAN PRICING

August YTD 2019 vs 2018 - Cumulative Median Prices - Down 1.4%

By Neighborhood

NEAR NORTH - Down 5.0%

LINCOLN PARK - Up 1.7%

LAKEVIEW - Down 2.5%

NORTH CENTER - Down 1.0%

By Price Point :

Over $1,000,000 - Up 4.0%

$500,000 to $1,000,000 - No Change

Under $500,000 - Up 1.3%




DAYS ON THE MARKET

August YTD 2019 vs 2018 - Cumulative Market Time - Up 11.3% To 89 days

By Neighborhood

NEAR NORTH - Up 18.1% to 111 days

LINCOLN PARK - Up 7.7% to 84 days

LAKEVIEW - Up 18.2% to 78 days

NORTH CENTER - No Change at 81 Days

By Price Point :

Over $1,000,000 - Up 6.5% to 146 Days

$500,000 to $1,000,000 - Up 11.9% to 94 Days

Under $500,000 - Up 14.5% to 71 Days


YOUR HOME

A logical question would be “how does all of this 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.

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 use algorithms that are often wildly inaccurate, as are many market analyses from real estate agents that have not taken the time to personally tour the home.

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.