A Forbes arcticle today cited Chicago as the city where home prices were improving the 4th most in the country, with a 1.7 percent increase this month after a 2.7 percent increase from June to July. I guess at this point any improvment puts you on the top 10, since #10, Seattle improved by just .1 percent.
But what does this say about Chicago as a real estate market? A lot of the other top 10s were places that had been slammed by recession (Detroit, Phoenix, Los Angeles) and may have had nowhere to go but up. Home values in Chicago may have dropped some, but not like some of these other cities.
Minneapolis is the strongest for improvement, helped along by manufacturing and stable financial institutions. We do still have some manufacturing near Chicago,but probably not enough to keep people here or increase home prices. D.C. is protected from drastic home price drops becaus so many people there are employed by the government.
So investing in the Midwest seems like a good idea right now. Markets change slowly and steadily, and I think Chicago will continue to attract intellectual capital and thereby jobs over the coming years. Plus, the housing stock is reasonably priced in comparison to some coastal cities.
2 Comments
Lucid Realty said:
If you look at the employment trends in Chicago you see that we are currently below where we were 10 years ago. Yet housing prices are substantially higher than 10 years ago. On the other hand our current home prices are below the long term trend in the area. The question is whether or not the trend can be sustained in an environment of zero job growth.
Maureen Wilkey said:
Agreed. It's hard to see how we can keep paying so much for housing if not everyone has jobs.
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