Northwest Suburban Chicago Rents Go Up
Investing in Chicago Real Estate
It's a side effect of the recent housing boom we've seen in several areas such as Las Vegas and now it appears to be hitting the Northwest Chicago Suburbs.
As more and more Chicago area developers converted apartments over to condominiums (condominium conversions) and focused more on building brand new Northwest Chicago condominiums and less on Apartments, vacancy percentages for landlords went down which has resulted in Landlords having the ability to raise rents.
According to Appraisal Research Counselors, rent in Northwest Cook County and Lake County had the biggest jumps and for the Suburban Chicago real estate rental market as a whole, rents went up 2% for the first quarter of 2007.
| SUBURBAN APARTMENT MARKET | |||
| Net rents for suburban apartments rose in the first quarter, matching a two-year high, while the vacancy rate edged down yet remained tight at 96%. Net rent factors in the value of concessions landlords give tenants, such as rent abatement. | |||
| Net rent per square foot | |||
| Selected submarkets | 1st quarter 2007 | 4th quarter 2006 | 1st quarter 2006 |
| Northwest Cook | $1.12 | $1.09 | $1.01 |
| DuPage County | $1.10 | $1.08 | $1.07 |
| Lake County | $1.20 | $1.11 | $1.10 |
| Naperville-Aurora | $1.06 | $1.04 | $1.03 |
| Waukegan-Gurnee | $0.96 | $1.00 | $1.14 |
| Total | $1.08 | $1.06 | $1.06 |
| Source: Appraisal Research Counselors | |||
It's also no surprise with all of the negativity in the media concerning the Chicago real estate market that potential home or condominium buyers are sitting on the sidelines to wait and see what happens with the real estate market.
Developers are backing off of converting apartments to condominiums with the lower housing demand and instead focusing on renovating existing buildings in order to raise rents. With occupancy percentages in the Chicago Suburbs reaching occupancy levels of 96%, it was only a matter of time before developers saw that they could make some improvements and raise rents.
Something else looming in the horizon that will make it even more lucrative for real estate investors: Rising Interest rates. If rates begin their upward trend as predicted by many in the Mortgage business, potential homeowners that have been waiting on the sidelines may suddenly find out that the rock bottom Chicago real estate prices they've been waiting for are going to be replaced with a higher mortgage payment due to higher interest rates.
Date: Wednesday, June, 13th 2007 @ 11:41:53 PM
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