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The Home Front

(Above) Edgewater Beach Apartments, completed in 1928. (Click on image to view larger version.) Photo by 606 Vision.

Chicago home buyers were riding a teeter totter market in the last few months of 2023 with interest rates falling and prices rising.

8-Mar-24 – The North Side resale home market showed signs of strengthening as prices rose a solid 6 percent during the fourth quarter of 2023, according to Mary Jo Nathan of Baird & Warner’s North Center office.

In 2023, a total of 8,311 resale housing units were sold on the North Side, thanks in part to falling mortgage interest rates. Nonetheless, full-year results were depressed by the combined impact of a limited inventory of homes for sale and interest rates that approached 8 percent at their peak.

During the fourth quarter, North Side home sales totaled 1,546 units, down 5.6 percent from the same period in 2022, Nathan said. However, that’s an encouraging contrast to the whopping 23.6 percent sales decline recorded for the full year.

The Baird & Warner North Side Market Report tracks sales of single-family homes and attached units – mostly townhouses and condominiums – in nine neighborhoods: Edgewater, Lakeview, Lincoln Park, Lincoln Square, Near North Side, North Center, Rogers Park, Uptown, and West Ridge.

The median sales price of homes sold in the final quarter of 2023 rose 6 percent to $376,250. Over the full year, the median price slipped 0.3 percent to $389,000.

Mary Jo Nathan

“The lack of inventory remains a serious issue, and not just on the North Side,” noted Nathan (left). “In the seven-county Chicago metro area, year-end 2023 inventory was down 18.5 percent from the comparable number in 2022.”

It’s possible that the recent decline in interest rates will encourage more homeowners to consider moving and thus add to the inventory of properties for sale, Nathan said. However, lower rates will also boost interest in buying a home among current renters.

Attached units dominate market

The attached homes category – primarily townhouses and condominiums – continues to dominate the North Side market, accounting for 89.5 percent of all 2023 resale home activity.

In the fourth quarter, there were 1,383 sales of attached homes, a drop of 6.2 percent from the same quarter of 2022.

“The stronger number of deals indicate that sales were stabilizing after falling 23.2 percent for all of 2023,” Nathan said.

The median price of an attached North Side home rose 0.3 percent for the full year to $360,000, which is an all-time record. The median price in the fourth quarter jumped 7.7 percent to $350,000. The average time an attached listing took to find a buyer was 58 days in the final quarter and 65 days for the full year.

Attached sales rose in three of the nine North Side neighborhoods during the fourth quarter. Those gains were 3.7 percent in West Ridge, 4.1 percent in Uptown and, most importantly, 9.6 percent in Near North, which is by far Chicago’s largest market for townhouses and condos.

The median sales price for an attached home rose in five of the nine neighborhoods during the fourth quarter, including hefty gains of 29.1 percent in West Ridge, 20.1 percent in both Rogers Park and Lakeview, 19 percent in Edgewater, and 17.2 percent in Lincoln Park.

Adobe Stock

There were 163 detached single-family homes sold across the North Side in the fourth quarter, unchanged from the same period in 2022. The median sales price of $1.2 million represented an increase of 11.5 percent. Average market time was 56 days, up from 55 days a year earlier.

For all of 2023, sales of detached homes totaled 754 units, a decrease of 26.5 percent from 2022. The 2023 median sales price rose 0.2 percent to $1,252,500.

Fourth quarter detached home sales soared 42.1 percent in West Ridge, which was the only North Side neighborhood surveyed that posted sales gains in both the attached and detached categories.

Single-family home sales were also up 16.7 percent in Edgewater and 4.5 percent in Lakeview, while Lincoln Square sales were unchanged from a year ago.

Two other significant detached home market areas had modest declines – 5.3 percent in Lincoln Park and 10.3 percent in North Center. Near North, Rogers Park, and Uptown had fourth quarter detached sales in single digits, as they often do, making percentage comparisons less valuable.

Median detached home prices recorded some sharp gains across the North Side in the fourth quarter. Of note were increases of a whopping 28 percent in Lakeview, 20.5 percent in North Center, 18.5 percent in Lincoln Square, 17.1 percent in Edgewater, and 16.3 percent in Lincoln Park. Those five neighborhoods accounted for 74.1 percent of all detached sales on the North Side in 2023.