The Chicago, real estate market had its most productive month in over a decade in April of this year. According to data from Zillow and Pulsenomics, there were more Chicago home sales in April than in any other month since 2005. The combination of higher savings from the economic shutdown and work from home enabling white-collar workers to move away from dense urban centers has resulted in an explosion of opportunity as buyers scramble to purchase homes with more space and more rooms.
The Chicago Real Estate Market
According to Zillow and Pulsenomics, over 3500 real estate transaction contracts were inked during April, several hundred more than the previous peaks in 2017 and 2016. Moreover, April 2020 sales were 26.5% above home sales last year. Many of these sales were from condominiums which are up 39.4% rather than single-family homes because there is still a supply crunch. Overall, new home construction only added a few hundred additional units; therefore, most of the sales were from previously owned units.
Impact of the Pandemic on the Chicago Real Estate Market
The pandemic upended economic life and resulted in millions of business closures and furloughed employees. However, the pandemic also illustrated that the United States, and Chicago specifically, is a world of two economies. One economy was shut down, with people laid off and businesses closed. The other kept humming, employing millions of people without any ability to spend their money on restaurants, travel, and leisure activities. So, as the economy starts to open up, all the money those white-collar workers saved during the pandemic must go somewhere.
The pandemic and shutdown resulted in significantly pent-up economic demand for restaurants, cars, home improvement, weights, bicycles, cars, and houses. While millions of people lost their jobs, many millions also kept their jobs and saved thousands of dollars during the pandemic. They continued working and earning their regular salary and commissions in white-collar positions. The pandemic also changed how people work. Millions of employees work from home, which means there is a lot more flexibility to live and work. Housing markets all over the country and in Chicago are faced with a huge increase in demand and flexibility in options which is spreading out homebuyers away from dense urban cores.
