Chicago Trends & Statistics 2018-2019

With higher real estate prices and lower-than-average job and population growth, the Windy City may not seem like a “good” place to invest in real estate. That being said, it is one of the few cities in the nation where housing prices still haven’t risen above their 2006 levels. When focusing on finding the highest capital growth and cash flow, you’ll find some Chicago neighborhoods offer homes at $108,000-$130,000 with rents at 1.17% of the purchase price every month.

All of this is good news for investors looking for under market value properties, with tremendous monthly cash flow, and poised for steady appreciation. Explore Chicago’s housing market, population, and employment trends in the next tabs to learn more.

Data Sources:

• https://www.zillow.com/chicago-naperville-elgin-metro-il_r394463/home-values/
• Real Wealth Network Affiliate Data
• https://factfinder.census.gov/
• https://www.deptofnumbers.com/employment/illinois/chicago/    

Chicago Real Estate Prices are Still Affordable

• In January 2018 the median purchase price of 3 bedroom single family homes in the Chicago metro area was $196,000.
• This is 3% less than the national average of $202,000 for 3 bedroom homes.
• In the neighborhoods where RWN members invest, the median purchase price was only $128,000 in January 2018, which is 37% more affordable than the national average.
• This shows us that real estate in Chicago is still more affordable than many other areas in the United States today. In the neighborhoods where Real Wealth Network members are investing property values are even more affordable.

Chicago Rental Income is Strong

• In January 2018 the median monthly rent 3 bedroom homes in Chicago was $1,542, which is 0.79% of the purchase price of $202,000. This is higher than the national purchase-to-rent ratio of 0.74%.
• In the neighborhoods where RWN members invest 3 bedroom homes rent for a median $1,479 per month, which is 1.17% of the $128,000 median purchase price.
• This shows us that Chicago offers investors a strong opportunity to generate cash flow at a significantly higher rent-to-purchase ratio than many cities across the nation today.

Chicago Offers Steady Equity Growth Potential

• In January 2012 median price of 3 bedroom homes in Chicago was $149,000. This means that, in the last 6 years (Jan 2012 to Jan 2018), 3 bedroom homes in Chicago have appreciated by just under 24%. During the same period, 3 bedroom home values appreciated by 41% nationwide.
• This shows us that Chicago home prices have been rising more slowly than other U.S. cities, but what’s important is that they have been increasing. This is a good indicator that Chicago’s real estate market is more stable than quickly appreciating/ depreciating markets.

Chicago Rents Have Been Rising Consistently

• Over the last 6 years (Jan 2012 to Jan 2018), the median monthly rent for 3 bedroom homes in Chicago has increased by 12%. During the same period, rents for 3 bedroom homes increased by 17% nationally.
• Although Chicago rents have risen more slowly than other U.S. cities over the last 6 years, they have increased substantially. This is a good sign that Chicago offers investors a good opportunity to make more passive monthly income over the next few years.

Chicago is Not Experiencing Significant Population Growth

• Between 2010 and 2017, Chicago’s population increased by 0.65%. During the same period the national population grew by 5.29%.
• This shows us that Chicago’s growth is declining — in fact, growth is declining in the entire state of Illinois.  According to U.S. census data, Illinois lost more residents than any other state in 2016, for the third year in a row. The state’s population is now at the lowest it has been in nearly a decade.
• The Chicago Tribune recently surveyed dozens of former Illinois residents, who have left the area within the last five years. They all offered their own list of reasons for doing so. At the top of the list were high taxes, the state budget stalemate, crime, the unemployment rate and the weather.

Chicago Job Creation is Lower Than Other U.S. Cities

• In the past year, Chicago added 31,400 new jobs to their economy – an annual growth rate of 0.67%. This is 61% below the U.S. annual job growth rate of 1.73%.
• According to Michael Lucci, vice president of policy at the right-leaning Illinois Policy Institute, neighboring states offer stronger job and business opportunities than Illinois today. This is especially true for younger, working-age adults, who make up some of the largest groups leaving the state.

Chicago is Still Affordable

• In the Chicago neighborhoods where RWN members invest, the median purchase price was only $128,000 in January 2018, which is 37% more affordable than the national average.
• This shows us that real estate in Chicago is still more affordable than many other areas in the United States today. In the neighborhoods where Real Wealth Network members are investing property values are even more affordable.

Chicago Rents are Strong

• In the neighborhoods where RWN members invest, 3 bedroom homes rent for a median $1,479 per month, which is 1.17% of the $128,000 median purchase price. This is 64% higher than the national average.
• This shows us that, in some Chicago neighborhoods, there is a strong opportunity to generate cash flow at a significantly higher rent-to-purchase ratio than many cities across the nation today.

Chicago Offers Some Equity Growth Potential

• Over the last 6 years (Jan 2012 to Jan 2018) the median price of 3 bedroom homes in Chicago has appreciated by 24% (compared to 41% nationally) and rents have increased by 12% (compared to 17% nationally).
• This shows us that Chicago home prices and rents have been appreciating more slowly than many other U.S. cities. They have been rising, however, which is a good indicator that Chicago’s real estate market is more stable than quickly appreciating/ depreciating markets.

Chicago is Not Growing as Much as Other U.S. Cities

• Between 2010 and 2017, Chicago’s population increased by 0.65%. During the same period the national population grew by 5.29%.
• In the past year Chicago added 31,400 new jobs to their economy – an annual growth rate of 0.67%. This is 61% below the U.S. annual job growth rate of 1.73%.