As a realtor, I am regularly asked about the general state of the market in Chicago, and the impact of current and rising interest rates on home values.
According to realtor.com 2019 forecast, interest rates are predicted to rise to just below 5.5% in 2019, and home sales are expected to slow nationwide. The number of home sales in the Chicago area will fall 7.4% in 2019, and the median sales price will be down 1.9%.
While Chicago may experience a slowdown in the market, Streeterville values remain stable and continue to appreciate with the exception of the $1M+ 3 bedroom/3 bathroom condos which have had a slight decrease in value in 2018.
Home Values in Streeterville
Streeterville is one of the fastest growing areas in Chicago. Home values have remained stable over the past three years with a 7.2% increase in December 2018 from December 2017. Sellers who price their homes competitively are able to receive 95-97% of original asking price with an average of 4 months market time.
Buyers seeking a one bedroom/one bathroom 1000+ sq. condo, can expect to pay approximately $450,000 to live in a full-amenity luxury building like 530 Lake Shore Drive or 505 N McClurg Ct. A completely renovated one bedroom/one bathroom 850 sq. ft. home can be purchased for a minimum of $300,000 at 260 E Chestnut, a well-maintained full amenity building. For $650,000 a buyer can purchase a two bedroom/two bathroom 1000+ sq. ft. condo in full amenity buildings like 240 E Illinois. For $835,000 to just under $900,000 a buyer can purchase a two bedroom/two bathroom 1600+ sq. ft. home with balcony and lake views at 600 N Lake Shore Drive.
A Closer Look at Streeterville Homes
In Streeterville, as of December 2018, 722 homes were sold, a 6% decrease from the previous year. The median sales price of all homes sold was $430,000, a 7% increase from 2017. In 2018, there were 439 homes for sale, a 15% increase from the previous year and a total of 1839 new listings, a 10.5% increase from the previous year. Overall market time is 125 days and sellers are receiving 95.1% of asking price. As one and two bedroom homes have appreciated in 2018, the larger three-four bedroom $1M+ homes have seen a 10% decrease in prices and amount of homes sold.
1 Bedroom/1 Bath 850-1000 sq. ft.
Median sales price is $254,000 just a slight 3.7% increase from the previous year. Sellers received 95.4% of original asking price. A total of 210 homes sold, a 5% decrease from the previous year.
1 bedroom/1 bath 1000+ sq. ft.
Median sales price is $440,000, a 2.3% increase from the previous year. Sellers received 96.8% percent of original asking. A total of 59 homes sold, a 16.9% decrease from the previous year.
2 bedroom/2 bath, 1000-2000 sq. ft.
Median sales price is $580,000 a 3.1% increase from the previous year. Sellers received 95.8% of original asking price. Average market time was up 121 days from 91 days the previous year. A total of 160 homes, sold a 14% decrease from the previous year.
3 bedroom/2 bath, 1000-2000 sq. ft.
Median sales price is $710,000, a 2.1% decrease from the previous year. A total of 41 homes sold, a 51.9% increase from the previous year. Market time was 119 days, down by 11.9% from 2017 and sellers received 94.3% of asking a 3.1% increase from the previous year.
3 bedroom/3 bath, 2000-3000 sq. ft.
Median Sales price is $1,302,500, a 10.9% decrease from the previous year. There were 34 homes sold as compared to 36 from the previous year. Average market time is 107 days and sellers received 94.9% of asking price.
The Bottom Line
Streeterville is one of the hottest and fastest growing markets in the city of Chicago. Good news for sellers is that demand is high for homes in this area. Home values continue to appreciate and the market is stable. Many out of town buyers looking to relocate to Chicago, choose Streeterville as their destination, and are able to pay cash.
Rising interest rates may cause a slight slowdown affecting buyer affordability; therefore, sellers need to respond to market competition and set realistic prices. Above median-sales priced sellers, may experience longer market time, and may want to offer price or other incentives to buyers.
Buyers who remain in this market will experience less competition as more buyers are priced out; however, may feel increased pressure to close before interest rates rise any further.
The nature of the market is cyclical and will continue to fluctuate, so buyers need to focus on the long term investment and appreciation in value. While we cannot predict what is going to happen in the market 6 months from now, we think Streeterville is a great opportunity for both buyers and sellers.
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Real Estate Brokers with Coldwell Banker - Chicago