New construction hit hardest as '08 sales fall 21 percent

Total home sales in Chicago dropped 21 percent in 2008 and new condominium sales reverted to pre-2002 levels, according to an analysis by Lakeshore Analytics of all Chicago residential home sales in the last seven years.

Even traditional preserves of Lakeview, Lincoln Park, and Near North were not spared by the drop in sales in 2008. The only neighborhood to post a significant gain in sales was the Near South Side.

Even as the number of home sales fell in almost every neighborhood, the median price of a condo or townhome also declined in 64 of 77 neighborhoods and the median price of a detached home declined in 69 neighborhoods. Many of the neighborhoods that saw the steepest falls in median prices are also those that sell for the lowest amount.

But the real damage was felt in new construction, as buyers pulled back from the new products offered throughout the city. In 2007, developers sold over 7,500 new condominium or townhome units: in 2008, that plummeted 75 percent to just 2,500. New single family homes were over 1,700 in 2007 and just over 750 in 2008.

The report, called “The Neighborhoods 2009” (http://www.lakeshoreanalytics.com/services) was released early this month and is the most complete analysis of residential real estate transactions in Chicago. It details median sale prices, number of sales, new construction trends, and loan-to-value ratios for all 77 Chicago neighborhoods.

A summary, called “Market Trends 2008” is available as a free download from the Lakeshore Analytics web site.

Chicago Sales Trends 02-15-2009 Charts (pdf)

Jeff Baird
Founder, Lakeshore Analytics
jeff@lakeshoreanalytics.com
www.lakeshoreanalytics.com