Chicago Housing market
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Chicago, located in Northeastern Illinois, is the most populous city in the State of Illinois and the third largest city in the United States. With a population currently sitting at over 2.7 million, The Windy City comes in third only to New York and Los Angeles. However, while most other major cities in the nation are enjoying population growth, Chicago’s population has actually been in decline for a few consecutive years. In fact, between 2016 and 2017, the metro area saw a loss of about 13,000 people. Nevertheless, with a population of over 9.5 million, the Chicago metro area is not suffering from this loss.

While a current or future Chicago real estate investor might take this as a bad sign of the market’s health, it’s important to look at the demographic makeup of the existing population in the city. Chicago, along with the Midwestern cities of Columbus, Indianapolis, and Madison, beats the entire nation when it comes to having a population in the age range of 25-44, which is considered the “prime worker” years. So the current loss of population is not hurting the economy nor the Chicago housing market as the residents staying behind make up a key part of the workforce in the city. And it’s important to note that buying a rental property in Chicago will mean having an abundant tenant pool as about 57% of the population rents a home rather than own one according to NeighborhoodScout.

Beyond the large workforce in the city, Chicago also has an emerging economy owing to the steady job growth. At the end of 2018, the Chicago-Naperville-Elgin metro area saw a growth rate of 1%, which was only slightly below the national rate of 1.6%. The Chicago real estate market also enjoys the environment of a diversified economy thanks to the city’s central location, making it more accessible than other major metro areas in the US. One of the leading industries in Chicago is manufacturing, specifically of food. Chicago is known as the “Candy Capital” of the nation as a large concentration of candy manufacturing companies call Chicago home. Other major industries include transportation, information technology, health services and technology, printing and publishing, finance, and insurance.

The Chicago housing market is one of the top five markets in the Midwest real estate market according to the annual PWC real estate report. Property investors from all over the nation are showing interest in buying Chicago investment properties as it’s one of the more affordable gateway markets in the US.

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Chicago  Real Estate Investment Performance
Facts and Market Trends in Chicago
Homes For Sale
4,459
Airbnb Properties
1,146
Rental Properties
19,971
Traditional Vacancy rate
5.90%
Airbnb Occupancy Rate
58.67%
Mashmeter
69.83%
Median Price
$440,943
Median Rent Price
$1,904
Price/sqft
$260
Median Days on Market
65
Price to Rent Ratio
18.3
Average Cap Rate
Airbnb
1.67%
Traditional
0.92%
Average Rental Income
Airbnb
$2,801
Traditional
$2,002
 
Median Household Income
$55,295
Population
2,716,450
Transportation in Chicago
78 / 100
Very Walkable
65 / 100
Good Transit
72 / 100
Very Bikeable
Chicago  Rent Prices
RENTAL STRATEGY STUDIOS 1 ROOM 2 ROOMS 3 ROOMS 4 ROOMS
Airbnb$1,840$1,727$2,047$2,485$2,680
Traditional$1,043$1,037$1,352$1,799$2,275
Chicago, IL - Homes for Sale - Newly Listed
Investment Properties for Sale
$180,000
MLS 10519026
1819 West TOUHY Avenue #5
Chicago, IL 60626
Rogers Park
Condo/Coop
2 beds2 baths0 sq.ft.
CAP RATE
Trad. -0.48%Airbnb 1.37%
Investment Properties for Sale
$149,000
MLS 10518310
7203 South St Lawrence Avenue
Chicago, IL 60619
Park Manor
Townhouse
3 beds3 baths1,968 sq.ft.
CAP RATE
Trad. 1.40%Airbnb 0.91%
Investment Properties for Sale
$299,999
MLS 10518312
1524 South Sangamon Street #401
Chicago, IL 60608
East Pilsen
Condo/Coop
2 beds2 baths1,250 sq.ft.
CAP RATE
Trad. 0.77%Airbnb 0.79%
Investment Properties for Sale
$159,900
MLS 10517174
4315 West Jackson Boulevard
Chicago, IL 60624
West Garfield Park
Single Family Residential
3 beds2 baths1,094 sq.ft.
CAP RATE
Trad. 2.15%Airbnb 2.35%
Top Performing Chicago Properties
Investment Properties for Sale
$157,500
MLS 10320747
5330 South Prairie Avenue #3S
Chicago, IL 60615
Washington Park
Condo/Coop
3 beds2 baths1,750 sq.ft.
CAP RATE
Trad. 1.94%Airbnb 7.99%
Investment Properties for Sale
$279,000
MLS 10475401
8 West MONROE Street #2002
Chicago, IL 60603
Chicago Loop
Condo/Coop
2 beds2 baths1,100 sq.ft.
CAP RATE
Trad. 1.46%Airbnb 7.94%
Investment Properties for Sale
$129,875
MLS 10465184
7443 South Crandon Avenue
Chicago, IL 60649
South Shore
Single Family Residential
4 beds2 baths1,310 sq.ft.
CAP RATE
Trad. 3.75%Airbnb 7.90%
Investment Properties for Sale
$79,000
MLS 10515778
817 North Parkside Avenue
Chicago, IL 60651
South Austin
Single Family Residential
2 beds2 baths1,590 sq.ft.
CAP RATE
Trad. 6.22%Airbnb 7.85%
Recently Sold Homes in Chicago, IL
Investment Properties for Sale
$129,900
MLS 10414859
2153 North Long Avenue
Chicago, IL 60639
Hanson Park
Multi Family
4 beds0 baths2,368 sq.ft.
CAP RATE
Trad. N/AAirbnb N/A
Investment Properties for Sale
$149,000
MLS 10462455
5205 South Wood Street
Chicago, IL 60609
Back of the Yards
Multi Family
4 beds0 baths1,680 sq.ft.
CAP RATE
Trad. N/AAirbnb N/A
Investment Properties for Sale
$750,000
MLS 10514632
1221 West Addison Street
Chicago, IL 60613
Wrigleyville
Multi Family
6 beds0 baths0 sq.ft.
CAP RATE
Trad. N/AAirbnb N/A
Investment Properties for Sale
$450,000
MLS 10513129
6235 North Harlem Avenue
Chicago, IL 60631
Norwood Park West
Multi Family
3 beds0 baths0 sq.ft.
CAP RATE
Trad. N/AAirbnb N/A
Property Value Changes and Real Estate Appreciation in the Chicago Housing Market

The Chicago real estate market has not historically experienced major property appreciation when compared to other large metro areas but beats most other cities in Illinois. Since Q1 of 2000, Chicago properties have experienced a total appreciation of 51.53%, at an annual average growth rate of 2.24% (according to NeighborhoodScout). Although real estate appreciation was minor in 2018 (Zillow reports 0.7% in 2018), it is on the rise in 2019 with a forecasted increase of 1.6%. This positive appreciation still makes the Chicago housing market a good place to buy investment property.

Currently, however, the city comprises a hot seller’s market. This is mostly due to the housing inventory shortage which most markets across the US are experiencing.

Chicago, IL Top Multi Family Homes
Investment Properties for Sale
$79,900
MLS 10077800
8559 South BUFFALO Avenue
Chicago, IL 60617
The Bush
Multi Family
5 beds0 baths0 sq.ft.
CAP RATE
Trad. 7.51%Airbnb N/A
Investment Properties for Sale
$90,000
MLS 10478510
9919 South Oglesby Avenue
Chicago, IL 60617
South Deering
Multi Family
4 beds3 baths1,631 sq.ft.
CAP RATE
Trad. 7.50%Airbnb N/A
Investment Properties for Sale
$90,000
MLS 10434598
2034 East 93rd Street
Chicago, IL 60617
Pill Hill
Multi Family
2 beds2 baths936 sq.ft.
CAP RATE
Trad. 7.22%Airbnb N/A
Investment Properties for Sale
$89,000
MLS 10438936
11356 South Prairie Avenue
Chicago, IL 60628
Pullman
Multi Family
6 beds0 baths0 sq.ft.
CAP RATE
Trad. 6.85%Airbnb N/A
Homes Below Median Price in the Chicago, IL Real Estate Market
Investment Properties for Sale
$157,500
MLS 10320747
5330 South Prairie Avenue #3S
Chicago, IL 60615
Washington Park
Condo/Coop
3 beds2 baths1,750 sq.ft.
CAP RATE
Trad. 1.94%Airbnb 7.99%
Investment Properties for Sale
$279,000
MLS 10475401
8 West MONROE Street #2002
Chicago, IL 60603
Chicago Loop
Condo/Coop
2 beds2 baths1,100 sq.ft.
CAP RATE
Trad. 1.46%Airbnb 7.94%
Investment Properties for Sale
$129,875
MLS 10465184
7443 South Crandon Avenue
Chicago, IL 60649
South Shore
Single Family Residential
4 beds2 baths1,310 sq.ft.
CAP RATE
Trad. 3.75%Airbnb 7.90%
Investment Properties for Sale
$79,000
MLS 10515778
817 North Parkside Avenue
Chicago, IL 60651
South Austin
Single Family Residential
2 beds2 baths1,590 sq.ft.
CAP RATE
Trad. 6.22%Airbnb 7.85%
Chicago Airbnb Growth and Regulations

In early 2016, the Chicago real estate market was one of the most popular Airbnb destinations and the fifth largest market for the vacation rental industry. The short-term rental market was set for serious growth. Nonetheless, in the last two years, Airbnb growth has slowed down with only a 3.9% increase in listings. This is because of the introduction of strict and costly Airbnb regulations in 2017, forcing the Airbnb Chicago market down to twelfth place for largest markets.

For Airbnb investors in Chicago, renting out a non-owner occupied single family home or multi family home with 2-4 units is illegal as these types of short-term rental properties are limited to primary residences only by law. However, an Airbnb investment property that has 5 units or more can operate legally as long as no more than 1 quarter of the units or up to 6 units (whichever applies) are rented out on a vacation rental website.

In order to operate within the bounds of the Airbnb Chicago laws, you must first identify which category of short-term rental your unit falls under - a shared housing unit (if it’s listed on sites deemed as “intermediaries” by law like Airbnb) or a vacation rental (if it’s listed on sites deemed as “advertising platforms” like HomeAway). Shared housing units are required to register with the city, while vacation rentals are required to obtain a licence.

Besides this, there are also large taxes in place for Airbnb rental owners as well as fees for the appropriate licences and registrations. Any listing found illegally operating will suffer heavy fines of up to $1,500-$3,000 a day.

Chicago, IL Top Airbnb Homes
Chicago Airbnb
$103 per night
Entire home/apt · 1 bed
Spacious Studio, Amazing Location!
589
Chicago Airbnb
$93 per night
Entire home/apt · 2 beds
Large, Private Logan Square Studio
574
Chicago Airbnb
$103 per night
Entire home/apt · 1 bed
Lincoln Park Studio, Great Value!
491
Chicago Airbnb
$45 per night
Chicago, IL Homes for Rent
Investment Properties for Sale
$2,625
MLS 10518854
1255 South STATE Street #1802
Chicago, IL
Dearborn Park
Single Family
2 beds2 baths1,100 sq.ft.
Investment Properties for Sale
$1,000
MLS 10519182
11236 South Vernon Avenue
Chicago, IL
Pullman
Single Family
2 beds1 baths820 sq.ft.
Investment Properties for Sale
$1,495
MLS 10519272
5100 North Marine Drive #25H
Chicago, IL
Margate Park
Single Family
1 beds1 baths750 sq.ft.
Investment Properties for Sale
$4,000
MLS 10518804
367 West Locust Street #204
Chicago, IL
Cabrini Green
Single Family
2 beds2 baths1,197 sq.ft.
Chicago, IL Open Houses
Investment Properties for Sale
Open 11 AM to 2 PM
$498,000
MLS 10518647
5 North Wabash Avenue #1101
Chicago, IL 60602
Chicago Loop
Condo/Coop
3 beds2 baths1,616 sq.ft.
CAP RATE
Trad. 1.04%Airbnb 6.88%
Investment Properties for Sale
Open 12 PM to 2 PM
$325,000
MLS 10516701
4309 North Damen Avenue #1
Chicago, IL 60618
South East Ravenswood
Condo/Coop
2 beds1 baths1,200 sq.ft.
CAP RATE
Trad. 2.33%Airbnb 3.40%
Investment Properties for Sale
Open 12 PM to 2 PM
$375,000
MLS 10517090
1917 West CHASE Avenue
Chicago, IL 60626
Rogers Park
Single Family Residential
3 beds2 baths1,450 sq.ft.
CAP RATE
Trad. -0.16%Airbnb 0.64%
Investment Properties for Sale
Open 11 AM to 1 PM
$869,000
MLS 10516742
1961 West Balmoral Avenue
Chicago, IL 60640
Bowmanville
Single Family Residential
4 beds4 baths3,800 sq.ft.
CAP RATE
Trad. -0.10%Airbnb 1.56%
Best Chicago Neighborhoods for Buying Investment Property
83%
Mashmeter
property price
$509,000
Median
cap rate
6.75%
Traditional
11.49%
Airbnb
rental income
$2,865
Traditional
$4,875
Airbnb
homes for sale
58
occupancy rate
66%
Airbnb
83%
Mashmeter
property price
$498,000
Median
cap rate
11.05%
Traditional
12.06%
Airbnb
rental income
$4,587
Traditional
$5,005
Airbnb
homes for sale
177
occupancy rate
67%
Airbnb
83%
Mashmeter
property price
$299,900
Median
cap rate
14.36%
Traditional
18.28%
Airbnb
rental income
$3,590
Traditional
$4,569
Airbnb
homes for sale
34
occupancy rate
65%
Airbnb
70%
Mashmeter
property price
$449,888
Median
cap rate
12.24%
Traditional
13.30%
Airbnb
rental income
$4,587
Traditional
$4,986
Airbnb
homes for sale
79
occupancy rate
65%
Airbnb
83%
Mashmeter
property price
$412,500
Median
cap rate
9.99%
Traditional
13.55%
Airbnb
rental income
$3,435
Traditional
$4,657
Airbnb
homes for sale
27
occupancy rate
67%
Airbnb
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