Across much of the country, the number of homes for sale is on the rise with many markets reporting levels higher than in 2019. It’s a different story in Chicago where inventory levels remain frustratingly low.
Supply is down 21 percent from last September; the lowest level noted since early 2007 when the Chicago Association of Realtors started recording this figure.
Home prices are tracking at more than double the rate of inflation, up 8.3% from last year, and six times the rate of September’s national average increase of 1.3%.
With limited new offerings and two-thirds of homeowners with mortgages holding rates below 5 percent, nationwide, the squeeze isn’t likely to abate any time soon.
Here’s how the inventory gap is playing out in our city’s most highly sought neighborhood where young professionals, affluent families and right-sizing empty nesters are wrangling over the morsels.
First, a look at its composition: Approximately 85 percent of Lincoln Park’s residential market consists of condos and town homes. There were 1,081 closed sales in the past 12 months, ending September. The Single-Family Home market saw 173 closed sales during that same window.
If you have personally felt the pricing surge in the neighborhood, you are in good company. The median price of all condos and town homes in Lincoln Park is 40 percent higher today, at $720,000 in September, than five years ago. The jump in Lincoln Park’s Single-Family pricing is even sharper. Median prices have increased 50 percent since September 2021 from $1.718M to $2.575M, the highest median price across the metro area.
Remarkable price appreciation is not universal, however. Growth has largely occurred in condos priced near or under $1M and homes priced under $3M.
CONDOS
- ↑ 41% median price of three-bedroom+ condos
- ↑ 8% median price of $1M to $2M condos
- ↓ 12% median price of $2M-plus condos
As condo buyers have sought larger footprints with more bedrooms, median prices of three-bedroom-plus condos have soared 41 percent from $760,000 in September 2021 to $1,075,000 this year. Meanwhile, condos priced from $1M to $2M witnessed just an 8 percent increase to a median price of $1.3M in September from $1.2M five years ago. The neighborhood’s upper-tier $2M-plus market saw a 12 percent decline in the median price. (This is due to a lack of refined offerings, which composed a larger share of the market during The Orchard’s initial sales run in 2021 and 2022, less elegant resales and newer developer-grade supply filling the gap.)
SFH
- ↑ 5% median price of $3M-plus SFH
- ↓ 6% median price of $4M-plus SFH
The accounting is similar among Single Families where significant median pricing gains are limited to the sub $3M market. Over the past five years, the median price of homes above $3M grew 5 percent to $3.925M in September. The median price of a Single Family above $4M actually fell 6 percent to $4.4M.
While prices at the upper end of the market haven’t experienced the same increase, its overall share has grown in the past five years. The $1M-plus condo market represents 27 percent of Lincoln Park’s condo market, up from 10 percent five years ago. The $2M-plus condo market has doubled its share from 2 percent to 4 percent. For Single Families, $3M-plus homes claim one-third of the market, up from 15 percent in 2021. $4M-plus homes control a 14 percent stake, up from 6 percent five years prior.
Lincoln Park’s market, like any other, possesses contradictions and opportunities for sellers and buyers. Our job is to analyze the nuances to help each client define an approach that achieves their objectives. Regardless of price point, careful preparation and strategic planning remain your greatest advantage.
