A few times throughout the year I look at the hottest Chicago neighborhoods for various types of real estate - e.g. new condo construction. However, the one statistic that neatly summarizes all aspects of real estate into a single hotness number that is most meaningful to home buyers and sellers is price appreciation. Although I provide monthly updates of the Case Shiller home price index similar data is not easy to come by at the neighborhood level. But fortunately the Depaul Institute For Housing Studies (IHS) produces a quarterly analysis of home price indices for 33 submarkets within Cook County and that can be quite enlightening. Just two weeks ago they updated their analysis through June 2019 so now is a good time for me to review what it's telling us about which Chicago neighborhoods have the hottest real estate.
I'll start by sharing this heat map they produce that summarizes the appreciation over the 12 months ending in June by submarket. By studying this you can see that the highest appreciating areas are more tightly focused than the last time I looked at this and Humboldt Park / Garfield Park is the top performer. There are also some areas on the south side that have higher than average appreciation.
IHS also maintains this interactive graph of historic price indices for all the submarkets in Cook County. When you roll over a line it tells you which submarket it is, what month you're at, and what the cumulative price appreciation has been from 2000 through that month. All the submarkets are indexed to 100 at the first quarter 2000 starting point although they actually have the underlying indices going back to the first quarter of 1997.
Here are some of the major takeaways from the data:
- West Town / Near West Side (which includes the West Loop) has had the greatest home price appreciation since 2000 - up a total of 181.2%.
- Logan Square / Avondale is right behind it with 166.8% growth.
- West Town / Near West Side and Logan Square / Avondale have both exceeded their bubble highs by larger percentages than any other neighborhoods - 19.7% and 16.5% respectively.
- However, only 6 neighborhoods in total have exceeded their bubble highs. The rest are still underwater.
- Humboldt Park / Garfield Park had the biggest run-up in home prices during the housing bubble, rising 192.8% in just over 7 years!
HumptyHumboldt Park / Garfield Park had the greatest fall from peak to bottom, losing 71.6% of it's value in just 5 years!
- Humboldt Park / Garfield Park had the largest recovery from the bottom, rising a total of 162.5% in just 7 years!
- Humboldt Park / Garfield Park has had the biggest increase in home prices for the last 12 months covered by this analysis with 16.3% appreciation!
- Yet, Humboldt Park / Garfield Park prices are still 25.4% below their bubble peak.
Do you notice a pattern there with one neighborhood showing up an awful lot? It's been on a real roller coaster.
- West Town / Near West Side prices have actually fallen slightly since the 1st quarter of 2018 but they have ticked up in the last 2 quarters
- Lincoln Square / North Center prices have been on a gradual decline since the 4th quarter of 2016
- Lake View / Lincoln Park prices never rose that much during the boom, didn't fall that much during the crash, and haven't really budged in the last 3 years.
- The 6 neighborhoods with the least appreciation since 2000 all experienced 5%+ growth in the last 12 months, which puts them in the top 11 neighborhoods for one year appreciation.
Gary Lucido is the President of Lucid Realty, the Chicago area's full service real estate brokerage that offers home buyer rebates and discount commissions. If you want to keep up to date on the Chicago real estate market or get an insider's view of the seamy underbelly of the real estate industry you can Subscribe to Getting Real by Email using the form below. Please be sure to verify your email address when you receive the verification notice.