Small Apartment Building Values Are Rising On The Hot North Side
Chicago is a city of neighborhoods, but not all residential enclaves are created equally. According to S&P Core Logic Case-Shiller Indices, Avondale’s average single-family home price rose 11.7% in 2017. In contrast, the average price of a single-family home in Englewood on the South Side in 2017 was $20,550, a decline of 6% from $22,000 in 2016.
“Three-flat and four-flat apartment values also are on the rise in the hot North Side neighborhoods of Old Town, Lincoln Park, Lakeview, Bucktown, Wicker Park, Ukrainian Village, Logan Square and Avondale,” noted Realtor Sara E. Benson, president of Benson Stanley Realty based in Chicago.
“Well located three-unit and four-unit income properties are highly attractive to small investors,” Benson said. “It’s about scarcity and demand. At any point in time, there typically are less than 3,000 small income properties listed for sale in Northern Illinois. At the same time there usually are about 40,000 single-family home listings and 15,000 condos for sale.”
X-Plus Real Estate, specialists in marketing two-unit to 12-unit properties, compiled the following analysis of 2017 three-unit and four-unit building sales by zip codes on Chicago’s North Side:
• 60614: In this zip code, encompassing Old Town and Lincoln Park, 21 three-unit properties were sold in 2017 for an average price of $1,014,952. Average market time was 118 days.
Fourteen four-flats in the 60614 zip code sold for an average price of $1,269,628 in 2017 with an average market time of 86 days.
• 60657: In Lakeview, 20 three-unit properties were sold in 2017 for an average price of $968,646. Average market time was 73 days. Fifteen four-flats in the 60657 zip code sold for an average price of $1,267,308 in 2017 with an average market time of only 56 days.
• 60622: This zip code includes Bucktown, Wicker Park and Ukrainian Village. Thirty-four three-unit properties were sold in 2017 for an average price of $750,956. Average market time was 74 days. Eighteen four-flats in the 60622 zip code sold for an average price of $978,993 in 2017 with an average market time of 64 days.
• 60647: In Logan Square, 46 three-unit properties were sold in 2017 for an average price of $582,050. Average market time was 83 days. Twenty-six four-flats in the 60647 zip code sold for an average price of $774,230 in 2017 with an average market time of only 50 days.
• 60618: This zip code includes West Roscoe Village, Avondale and Albany Park. Sixty-eight three-unit properties were sold in 2017 for an average price of $557,491. Average market time was 64 days. Twenty-three four-flats in the 60618 zip code sold for an average price of $693,768 in 2017 with an average market time of only 33 days.
Despite reports of strong investment-property sales in key North Side neighborhoods, all is not rosy in the Chicago-area market. S&P Core Logic Case-Shiller Indices indicate that Chicago ranks 20th among the nation’s biggest metropolitan areas with only a 2.6% rise in home values last year.
Chicago-area home appreciation is low because of lackluster job growth, soaring real estate taxes and an exodus of residents to other states, experts say.
Nationwide in 2017, home values rose 6.3%. The Seattle market led the nation with a 12.7% price rise, followed by Las Vegas with 11.1% gain in home value.
The Chicago area also leads the nation with 253,725 underwater homes—those on which the owner owes more on the mortgage than the property is worth, according to Zillow’s 2017 Q4 Negative Equity report. That total is more than all the underwater homes in both New York and Los Angeles combined.
For more housing news, visit www.dondebat.biz. Don DeBat is co-author of “Escaping Condo Jail,” the ultimate survival guide for condominium living. Visit www.escapingcondojail.com.
