Year End Homes Sales Plummet On Chicago's North Side (But Don't Panic)

Despite 12 consecutive months of sales decreases and inventory increases, It was surprising to see sales plummet an additional 35% in December 2018 vs 2017.

As you look at the end of year numbers below, don’t panic!

What Is Happening ?

The decrease in sales and increase in inventory levels over the past year point to a wind down from the incredible rebound of the 2008 recession that began in 2012 / 2013.

We are entering a “new normal”, where the playing field between buyers and sellers is leveling out.

Increasing inventory levels are strengthening the position of buyers, but there are also still some great opportunities for sellers.

In short, we have moved away from the recession rebound bubble and into a more balanced market

Although December sales plummeted, 2018 cumulative home sales dropped only 7.8 % vs 2017.

The cumulative Months Of Supply Of Inventory is 3.7 MSI. While this is up from last year, it still favors sellers (see MSI below).

Market activity is not as dramatic as in the past few years, but it is still very healthy.

Why Is This Happening ?

We have worked through the pent up buyer demand from the post recession years and now the market is facing some additional changes and challenges.

City & state financial instability, the perception of rising crime, rising interest rates and a flood of new construction of luxury rental properties are all having an affect on home sales.

In addition, many current sellers have not adjusted to the “new normal” and are not re-evaluating their pricing. As a result, these older over priced listings accumulate market time and contribute to rising inventory levels.

Outlook for 2019

  • The election of a new mayor and governor will hopefully give buyers and sellers confidence that the government financial problems will be addressed and not by raising property taxes alone.

  • The perception of rising crime is just that, perception.

    In reality, 2018 crime rates in Chicago have dropped in 7 of the 8 reported categories, including a 15% drop in murders and shootings (which still remains unacceptably high).

    The city needs to continue to aggressively fight crime and the inaccurate perception that crime is rising.

  • Interest rates, while rising, are still relatively low in comparison to past markets.

    It is unlikely that rising interest rates will prevent buyers from purchasing homes; however, it may force some to buy smaller homes, as their buying power could be reduced.

  • Higher inventory levels will give buyers more leverage in the 2019 market.

    For sellers, new listings that are priced competitively are selling well and in many cases at higher prices than last year.

    Homes that have accumulated significant market time are one of the major causes of rising inventory levels.

    Sellers should re- evaluate both price and presentation and adjust to current market conditions.

  • The flood of high end new construction rental buildings will impact home sales for some time.

    It is too early to predict how much of an impact these new rental buildings will have in the long term, but some first time home buyers may chose to rent rather than buy.


December 2018 vs 2017 – Cumulative Home Sales dropped 35.2%

NEAR NORTH - Down 37.2%

LINCOLN PARK -Down 48.5%

LAKEVIEW - Down 21.8%

NORTH CENTER - Down 24.4%

Noteworthy :

Sales of luxury homes (priced over $1,000,000) decreased 47.5%

Sales of homes priced from $500,000 to $1,000,000 increased 30.6%

Sales of homes priced under $500,000 decreased 32.7%



December 2018 vs 2017 –  Cumulative Homes Under Contract decreased 20.7%

NEAR NORTH - Down 29.9%

LINCOLN PARK -Down 26.7%

LAKEVIEW - Down 8.9%


Noteworthy – Most home sales that closed in December 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.  



December 2018 vs 2017 – Cumulative Inventories of homes rose 12.5%

NEAR NORTH - Up 11.2%

LINCOLN PARK -  Up 20.1%

LAKEVIEW - Up 11.9%


Noteworthy :

Luxury home inventories (priced over $1,000,000) decreased 1.9%

Inventories of homes priced between $500,000 to $1,000,000 rose 10.6%

Homes priced under $500,000 saw inventory levels increase by 27.4%



December 2018 vs 2017 – Cumulative Months of Supply of Inventories rose 23.3% to 3.7 MSI

NEAR NORTH - Up 19.5% to 4.9 MSI

LINCOLN PARK - Up 31.0% to 3.8 MSI

LAKEVIEW - Up 20.8% to 2.9 MSI

NORTH CENTER - Up 14.8% to 3.1 MSI

Noteworthy :

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

MSI of luxury homes priced over $1,000,000 rose 4.8% to 6.6 MSI

MSI of homes priced between $500,000 and $1,000,000 increased 11.8% to 3.8 MSI 

MSI of homes priced under $500,000 rose 40.0% to 2.8 MSI


December 2018 vs 2017 – Cumulative Median Prices decreased by 4.8%

NEAR NORTH - Down 7.8%

LINCOLN PARK - Down 7.5%

LAKEVIEW - Down 1.3%

NORTH CENTER - Down 0.8%

Noteworthy :

Median prices of luxury homes priced over $1,000,000 decreased 6.3%

Median prices of homes priced from $500,000 to $1,000,000 decreased 1.5%

Homes priced under $500,000 decreased 3.0%



December 2018 vs 2017 – Cumulative Average Days On The Market remained at 102 days

NEAR NORTH - Up 6.4% to 116 days

LINCOLN PARK - Down 2.9% to 100 days

LAKEVIEW - Up 13.9% to 82 days

NORTH CENTER - Down 9.1% to 110 days

Noteworthy :

Market time for luxury homes priced over $1,000,000 decreased 24.2% to 119 days

Homes priced between $500,000 and $1,000,000 posted market time increased 35.6% to 118 days

Market times for homes priced under $500,000 decreased 6.6% to 84 days