If you are hunting for an affordable home, townhome or condominium on the North Side of Chicago this spring, shop the Far North Side, experts say.
Sales of affordably priced homes, townhomes and condos in West Ridge, Rogers Park, Edgewater, and Uptown out-paced transactions in wealthier neighborhoods during the first quarter of 2019, according to the North Side Market Report, a new quarterly survey prepared by The Wilcox Company.
“Fairly brisk sales activity took place in the northern-most neighborhoods—where existing home prices tend to be the lowest—while sales were slower in higher priced areas, such as the Near North Side and North Center,” said Mary Jo Nathan, a broker associate with The Wilcox Company who prepared the report. Visit: www.thewilcoxcompany.com.
“The shift in first-quarter sales activity toward the lower end of the market stems from a continued demand for moderately priced condos, while buyers’ interest in pricier condos, townhomes and single-family homes was somewhat muted,” Nathan said.
The North Side Market Report covers nine of Chicago’s 77 community areas: Edgewater, Lake View, Lincoln Park, Lincoln Square, Near North Side, North Center, Rogers Park, Uptown and West Ridge. North Side home, townhome and condo sales for the quarter totaled 1,712 units, a decline of 9.9% compared with the first quarter of 2018.
First-quarter sales increased in just two of those nine areas. Sales transactions skyrocketed 23.4% in Edgewater and 12.2% in Rogers Park. Sales in West Ridge were flat compared to 2018 results.
Elsewhere sales activity dipped. The number of transactions slipped 22.8% in North Center, 22.5% in Lincoln Square and 21% on the Near North Side. In Lake View transactions slipped 10.7%, while sales eased 6.5% in Lincoln Park, and fell 2.4% in Uptown.
According to The Wilcox Company, the median sales price rose in three communities during the first quarter—gaining 2.1% in Edgewater, 4.4% in Lincoln Park and 8.3% in West Ridge. Meanwhile, median prices slipped in six neighborhoods. The declines were 10.8% in Lake View, 6.8% in Lincoln Square, 8.8% in North Center, 11.1% in the Near North Side, 7.2% in Rogers Park and 4.8% in Uptown.
Experts say the first-quarter median price declines likely were caused by the Polar Vortex in Chicago and the sharp rise in mortgage rates at the end of 2018, which turned off many would-be buyers.
The North Side market is dominated by sales of attached homes, primarily condominium apartments, but also townhouses. Here is a breakdown of median condo, townhome and detached single-family home resale prices for the nine neighborhoods in the first quarter of 2019:
• West Ridge. The Far North Side neighborhood posted an extremely affordable median condo and townhome price of $140,000. Detached single-family homes in West Ridge sold for a median price of $352,500. (The median is a typical market price where half the homes sold for more and half sold for less.)
• Rogers Park. Condos and townhomes sold for median prices of $171,750 in Rogers Park. Detached homes in the lakefront neighborhood sold for a median price of $417,500.
• Edgewater. This lakefront neighborhood posted median condo and townhome prices of $224,700. Detached homes in Edgewater sold for a median price of $700,000.
• Uptown. Condos and townhomes sold for median prices of $255,550 in Uptown. Detached homes sold for a median price of $727,000.
• Lincoln Square. Median condo and townhome prices in Lincoln Square were $289,900. Detached homes sold for a median price of $740,000.
• Lake View. Condos and townhomes sold for median prices of $325,000 in Lake View. Detached homes sold for a hefty median price of $1.565 million.
• Near North Side. The neighborhood posted median condo and townhome prices of $371,000. Detached homes on the Near North Side, including the wealthy Gold Coast, sold for a whopping median price of $2.365 million.
• North Center. Median condo and townhome prices in North Center were $444,000. Detached homes sold for a median price of $1.16 million.
• Lincoln Park. Condos and townhomes sold for median prices of $505,000 in Lincoln Park. Detached homes sold for a hefty median price of $1,562,500.
Of the 1,712 homes sold during the quarter, only 10.2% were detached single-family homes. Condos and townhomes accounted for 1,537 units sold.
The sales data analyzed by The Wilcox Company was collected by Midwest Real Estate Data, LLC, the regional multiple listing service.
“Demand for affordably priced condos and townhomes is driven more by basic economic factors, such as mortgage interest rates and employment levels, both of which were at supportive levels in recent months,” Nathan said.
On April 25th, benchmark 30-year-fixed home loans averaged 4.2% nationwide, reported Freddie Mac’s Primary Mortgage Market Survey. A year ago, the 30-year-fixed mortgage average was 4.58%.
“After dropping dramatically in late March, mortgage rates have modestly increased since then,” noted Sam Khader, Freddie Mac’s chief economist. “While this week marks the fourth consecutive week of rises, purchase activity nationwide reached a nine-year high—indicative of a strong spring home buying season.”
Many buyers in the affordable segment of the market are first-time purchasers seeking the long-term stability offered by homeownership, Nathan observed.
“On the other hand, more expensive residences are typically purchased by buyers who already own but want something better suited to their current situation,” she said.
“However, a wide range of factors, from rising property taxes to the uncertainty surrounding the recent city elections, could encourage a delay in their buying decision,” Nathan said.
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.