Ten years ago, home prices across the nation were ascendant and Chicago was no exception. For a hot second all seemed well – until the worst financial crisis since the Great Depression.
By most accounts, the housing market in Chicago has largely recovered. No, it’s not perfect – price growth is slow compared other cities tracked by S&P/Case-Shiller, foreclosure rates for Chicagoland counties aren’t great (Illinois is fifth-worst in the nation) and disparity in home prices and quality from neighborhood to neighborhood is still distressing.
On the other hand, there are positives: inventory is ticking up, builders are building and foreign investment is at an all-time high. We’ve gone from an unqualified disaster to a mixed bag. So if you bought in one of the trendy neighborhoods in and around the Loop in 2006, where would your investment be?
In River North and Streeterville, buyers are substantially ahead. Because housing prices didn’t trough until 2011, buying in early 2006 wasn’t a disaster at all. In the Gold Coast, early 2006 buyers have at least got a positive return.
The Loop hasn’t recovered, despite reports of it becoming a more desirable place to live. For current buyers, the lower prices might appeal. Perhaps the neighborhood was just substantially overvalued at the beginning of 2006 and is now priced more appropriately.
And the South Loop, the center of so much building frenzy and enthusiasm during the bubble, has mostly recovered. While there’s nothing inspiring in the Sloop’s recovery, that hasn’t stopped a second wave of enthusiastic construction. Only this time, builders are focusing as much on rentals as condos – a shift from the earlier frenzy.
