Is Chicago a good place to invest in real estate? This is a popular question that a lot of people nowadays ask. As a result, we’ve written this article to assist you. Chicago is located on the southern shores of Lake Michigan, the world’s sixth-biggest freshwater lake. Chicago, sometimes known as the “Windy City,” is home to about 3 million people who live in 100 different neighborhoods.
Chicagoans are passionate about sports. There are eight professional sports clubs in the city, two of which are in Major League Baseball. If you’ve ever attended a sports event in Chicago, put on your foam finger and rally hat and prepare to have a wonderful time.
Sports aren’t the only thing the city has to offer. There are almost 200 theaters in Chicago and 250 live music venues, and dozens of yearly film festivals and parades. Chicago is often grouped alongside other major cities such as New York, Los Angeles, and San Francisco, and with good cause.
Each one is heavily inhabited, offers many career opportunities, and draws millions of visitors each year. In many aspects, Chicago resembles Los Angeles, New York City, or San Francisco. The one exception, which is particularly important for real estate investors, is that Chicago is reasonably priced.
An excellent property in Los Angeles will set you back more than half a million dollars. The cost of living in New York City is significantly higher. Meanwhile, the average house price in the greater Chicago region is lower than the national average.
For investors, the real estate market in Chicago offers an once-in-a-lifetime opportunity. It’s one of the country’s largest cities, yet it’s still reasonably priced.
Is Chicago a Good Place to Invest in Real Estate?
Yes! Everything you’ve heard regarding Chicago real estate is correct. You’ve probably considered various choices as an investor, ranging from bitcoin to stocks. Your investigation would have found that some provide significant capital gains, some offer tax advantages, and others provide a vital source of passive income.
Is there, however, a single asset that can provide all of these advantages at the same time? The solution, of course, is real estate. In the field of investing, real estate has shown to be in a class by itself.
Aside from the advantages listed above, further benefits of real estate investment include leverage, risk diversification, and inflation protection.
However, to get the total rewards of real estate investment, you must put your money into a robust market. We can affirm that Chicago is such a market, given the rising demand for rental units.
Reasons to Invest in Real Estate in Chicago
Many variables impact the Chicago real estate market, many of which contribute to the city’s prosperity. We’ve done our homework and assembled the most current and relevant information regarding Chicago’s real estate market!
A healthy and thriving economy
Chicago’s economy has developed into a regional powerhouse in the Midwest. Because of its geographic location, it is at the core of various economic activities. Traditional aspects such as agriculture, transportation, commerce, and industry are not excluded. This economic diversity is a strong suit for the city.
This has resulted in the relocation and development of regional headquarters for international corporations in the city. Amazon, IBM, Boeing, JLL, and Veolia Environmental Services are mentioned.
According to statistics, O’Hare International Airport in Chicago is one of the busiest airports in the region. Business people and investors are familiar sights at the airport, arriving to finalize transactions and enquire about Chicago’s business needs.
Number of people
The feasibility of an investment is the primary worry of an investor. While various elements influence the property’s performance, the population is one of the most essential. It affects demand, property value appreciation, and the achievement of a higher-than-average return on investment.
Many people get surprised to learn that Chicago is one of the most populated cities in the United States. Hundreds of thousands of new citizens have moved to the city throughout the years. This is due to its thriving and diverse economy.
The metropolitan area houses the majority of the population. The draw of suburban living has resulted in a population boom in Chicago’s northwest and south suburbs.
According to the Chicago Metropolitan Agency, the population of the Chicago metropolitan region will shortly reach ten million people. Given the long-term value of the real estate as an investment, this is good news for both present and prospective landlords.
It’s a Tenant’s Market
A renter’s market is one in which supply and demand ratios and general economic circumstances favor renting over owning property for a significant portion of the population. In recent years, property prices in Chicago have been growing, which is a compelling argument to invest in Chicago real estate. Since the cost of living has risen, more residents in the city are deciding to rent rather than buy.
The supply of housing is a significant factor in the present situation. Real estate is recognized for being a sluggish responder to market changes. As a result, new house construction is slow despite the growing population. This adds to the appeal of the available houses. A renter’s market is perfect for any landlord wishing to make a real estate investment.
It would help if you understood the relevance of quality of life as an investment aspect as an investor and potential landlord. For many areas of the economy, the Covid-19 epidemic has transformed the status quo.
When it comes to selecting a rental place, tenants today consider the quality of life one of the most significant aspects. This may get ascribed to changes in the social environment and legislation that allow people to work from home.
Chicago is much less expensive than cities of comparable or greater size regarding living costs. Tenants who have relocated from San Francisco and New York to take advantage of the lower living expenses are widespread.
There are diverse outdoor activities for families and people to enjoy, and the beautiful Lake Michigan and the Chicago River. Different municipal and county governments have also ensured that parks and leisure amenities are close.
Best Chicago Neighborhoods for Real Estate Investing
The housing market in Chicago is still rebounding from the 2008 Great Recession. It won’t be until 2021 that house prices finally recover. As a result, it is feasible to purchase an investment property in Chicago for a relatively low cost. Here are some of the top Chicago areas to invest in real estate, in no particular order:
Chicago’s Rogers Park
Rogers Park is about three miles from Evanston and ten miles from downtown Chicago. There have been several single-family residences and multi-family apartment complexes in this highly walkable neighborhood since the 1930s.
Furthermore, there are various beaches and parks in the area and easy access to various attractions. Loyola University, situated near Rogers Park, generates a lot of rental demand.
These are just a few of the numerous reasons why Rogers Park is one of Chicago’s most significant investment communities. Rogers Park has an average property price of $222,000 and a monthly rent of $1,199.
Chicago’s Edgewater neighborhood
Edgewater, located immediately south of Rogers Park, has seaside views of Lake Michigan. It’s simple to understand why the real estate market in this area has gotten increasingly competitive in recent years.
Edgewater’s typical house costs $250,000, and prices have increased by 32% in the previous three years. Edgewater’s development has made it one of Chicago’s most promising neighborhoods. Edgewood rents for roughly $1,700 per month on average.
Chicago’s Logan Square
Logan Square is one of Chicago’s most prominent neighborhoods. Palmer Square, a large eight-acre green park, is located here. Many residences are original greystones and bungalows, and the streets are lined with 100-year-old trees. Like most Northwest Side, Logan Square is recruiting a new generation of residents known as Millennials.
Thus, it has become one of the top singles neighborhoods in Chicago. The average price of a property in this community is roughly $450,000. Homes have increased by over 6% since 2019 and are predicted to climb by another 7% in the next year.
In this area, rental prices are likewise much higher. Logan Square’s average rent is $2,000 per month. Single-family houses or flats with three bedrooms rent for roughly $2,500 per month. High rents might justify investing in Logan Square if you can locate a good bargain on a home.
Chicago’s Pilsen neighborhood
On Chicago’s Lower West Side, Pilsen has a more suburban feel, which attracts families. Apartments, condominiums, and single-family houses make up the neighborhood. Students and professionals flock to the region because of the University of Illinois and the UIC Medical District.
Pilsen’s typical house costs roughly $350,000. The average monthly rent is $1,600. The three L stations in Pilsen make it simple to navigate throughout the city, and rental demand is strong.
Frequently Asked Questions
Is Chicago a good place to invest in real estate?
Yes. As highlighted above, Chicago is an excellent place to invest in real estate.
Is it a great time to purchase a home in Chicago right now?
Unless they have financial or personal reasons to delay, now is a perfect moment to invest in Chicago real estate. Buyers on the fence should act now, rising sales prices and low loan rates. The city of Chicago currently has a more significant inventory than the rest of the country.
Where should I stay away from in Chicago?
The following are Chicago’s most hazardous neighborhoods:
- West Garfield Park
- Washington Park
- East Garfield Park
- North Lawndale
Is it safe to reside in Chicago’s downtown area?
The Loop, or downtown Chicago, is considered a safe location in Chicago. Pickpocketing is the most common kind of crime locally. However, you should exercise caution and keep an eye on your surroundings while you’re there.
In conclusion, it’s challenging to find a better place than Chicago regarding real estate investment. Over the years, Chicago’s growing population, renter’s market, quality of life, and thriving economy have made it a target for investors. To this end, the above highlight on “is Chicago a good place to invest in real estate?” will aid you immensely.