Do you want to know a question with a million different answers? Ask anyone in the Chicago tri-state area what “Chicagoland” is. You’ll get answers ranging from “basically just Bridgeport” to “everything from Kankakee to Madison.” But no matter how Chicagoland is defined, real estate investors need to understand the complexities of this market in order to make good investment decisions.
The pandemic shook this region, but the real estate market, like the people, showed a ton of resilience. Part of this is because of the diversity within the area. Regions that weren’t particularly fruitful for real estate investors were balanced out by areas that were.
Chicagoland real estate trends are as diverse as the region itself. Knowing what they are, and how to leverage the disparities in market possibility, you will set yourself up to answer the only question that really matters: how do I run my real estate investing business best?
Defining “Chicagoland” (and Why That Matters)
There are a lot of different interpretations of Chicagoland. The Census Bureau categorizes it as the “Chicago-Naperville-Elgin, IL-IN-WI Metropolitan Statistical Area (MSA)”. This region includes the four lake-adjacent counties in Indiana, as well as Kenosha County in Wisconsin. With a population of more than 9,000,000 people, it’s the third-largest MSA in the country.
People might be surprised that some of the far-flung counties—the ones outside the traditional “collar”—are considered part of Chicagoland. It is described as anywhere impacted by Chicago’s gravity. It makes sense. When people move out of the city, they typically go to Naperville, Schaumburg, Libertyville, Chain o Lakes, etc. They might jump across the border to Indiana and live in Merrillville. It’s easy to jump on the UP-N and get from Wisconsin to the Loop in about an hour.
Why does this matter to real estate investors? It matters because it shows how much what happens in one part of a region impacts another. Understanding those trends—and the interplay between them—will help determine your course of action in your real estate investing business.
5 Chicagoland Real Estate Trends
Obviously, the biggest aspect of the real estate market is the effect and aftereffects of the pandemic. Before, the hottest real estate markets in Illinois were outside the metro region; now, that might be changing.
Trend 1: The City Is Happening Again
At the beginning of the pandemic, we all wondered how the city would react. Would everything be shut down forever? Would all restaurants close? Would the market totally collapse? That turned out not to be the case. According to Redfin, in “Last year, Chicago home prices were up 16.4% compared to last year, selling for a median price of $355K.” That’s due to a smaller inventory than usual, which means being able to get leads in Chicago is super valuable right now.
Trend 2: More Neighborhoods Are Becoming Appealing
The hot neighborhoods—such as Logan Square and Wicker Park, for example—are always going to be hot. That in some ways isn’t opportune for investors. But what’s interesting is that there are a lot of other neighborhoods in the city that offer more interesting, less-known deals. Some of the best places to buy investment property in Chicago include neighborhoods like Avondale, Humboldt Park, and even Englewood. More people are moving out of those neighborhoods, increasing stock, just as their surrounding “hot” neighborhoods are filling up.
Trend 3: People Are Searching Across the Metro Area
Why are people leaving Avondale or Englewood? Because they can. They likely can work from anywhere. And that’s leading to newer markets having an opportunity. We see this across the region. Demand in the MSA far outstripped supply. Even with that, in the Chicago Metro Area, which comprises nine counties, the number of homes sold during the year rose by 8.8 percent to 120,256 sales. That’s the highest since 2012, according to the most recent Illinois Realtors market report. What does this show? People wanted to move around the region.
Trend 4: It’s a Better Renters’ Market in Other Areas
Typically, if someone was born and raised in the suburbs of Chicago, they would go off to college, come back and rent in a happening neighborhood for a few years, buy a condo in a less happening one after getting married, and then return to the suburbs with their family to buy a house. But as rent prices increased in Chicago, they stayed steady across the MSA. Indeed, even though the average rental in Chicago is around $1,900, it’s $1,600 in the MSA (with Chicago’s high price kicking that up). Post pandemic, people don’t mind living further out from the city. And that ties into the last, more ephemeral trend.
Trend 5: The MSA Has Stepped Up Its Game
When I was a kid, there was a Michelin-starred restaurant in Wheeling, and it seemed incongruous. Now, I wouldn’t blink an eye in disbelief; it’s normal. Suburbs, exurbs, and large towns with their own gravity (like Naperville) offer nearly everything that city living does. So they attract a lot of people who would traditionally stay in the city. This can expand your ability to successfully invest anywhere. There are growing markets across the MSA.
So what does it take to succeed? It takes dedication and hard work. It takes knowledge of the region. But more than anything, it takes leads.
The Best Way To Get Leads in Chicagoland
As you can tell, I love this region. I have always felt connected to it, and I love that as a real estate investor I can make a difference in the community. That feels good. Investing in an independently owned and operated HomeVestors® franchise has been the biggest difference in my business.
Why? It comes down to quality leads. From Kankakee to Kenosha, everyone has heard of the We Buy Ugly Houses® national marketing campaign from HomeVestors®. So when people need to sell a house fast for cash, they call HomeVestors®, and I can get the lead. If the market is right, and I can get a good price, I can close the deal.
I used to think that Chicagoland was only for people who knew the Empire Carpet jingle. But it’s not an area as much as a state of mind. And if your state of mind is to succeed in getting people into homes here, you need the best leads. Now you know how to get them.
If you’re considering investing in real estate in Chicagoland, request information about becoming a franchisee today.
Each franchise office is independently owned and operated.