Chicago Property Prices Stagnate, Trail Even Crisis-Stricken Hong Kong – Wall Street Journal

Prices of office buildings, hotels, apartment properties, retail centers and other commercial real estate in Chicago fell by 4.1% over the past year, according to research firm Real Capital Analytics. That was the worst performance among major metropolitan areas analyzed by the company, behind even crisis-stricken Hong Kong, where prices fell 2.6%. “The primary reason that Chicago is struggling from an investment-sales perspective is the outlook for higher taxes in the future,” said Dave Bragg, a managing director at Green Street.
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Astonished
4 years ago

We “ain’t seen nuttin’ yet.” When the crisis arrives and the clowns running this circus try to tax their way out (and we all know they will), the entire real estate market in IL will simply freeze solid, with the only homes or properties changing hands doing so via “tax seizure” followed by “tax sale” for literally pennies on the dollar. Property tax rates aren’t set by distressed or tax-lien sales, so it’s entirely plausible that during the crash-and-burn phase, a $250,000 home could be assessed for $25,000/yr taxes and be unsellable at $25,000 (one tenth it’s pre-crisis value) ON… Read more »

debtsor
4 years ago
Reply to  Astonished

We are already here in some southern suburbs. I have a friend who owned a commercial property in the southern suburbs. The rents paid the taxes. If a tenant didn’t pay that month (which was frequent) the owner had to pay the taxes from his pocket. No profit at all, just taxes. The company eventually sold it for nothing – it had no mortgage to pay off – to a new owner, just so that it didn’t have to pay the real estate taxes ever 6 months. The resale value was literally zero – no bank would lend on it,… Read more »

Astonished
4 years ago
Reply to  debtsor

Wow. A friend also had some rental (Section 8) properties, but told me that finding tenants (who wouldn’t destroy the place) was so difficult that he considered letting the county seize them for tax foreclosure. He was losing money every month, after thinking (wrongly) that the cost of the houses was so low that his risk was minimal. I carry my house (paid off) in my head at zero value. It’s modest and my costs for upkeep and taxes are, for the time being, manageable. It’s my kids who I worry about. Two of them have much larger, more valuable… Read more »

Gemini
4 years ago

The “woke” crowd haw no interest in financial stability. Numbers gives them hives.

Their only concern is to keep minorities poor and angry, so they can be used as political pawns to maintain their own power base.

Astonished
4 years ago
Reply to  Gemini

Leftists would rather rule a cesspit than be just another Joe in a Garden of Eden.

Downstate cynic
4 years ago

Real estate value deflation is a wealth destroyer.
In addition to current and future tax burden there is no hope for any rational correction of the Chicago, Cook county and State financial issues.
If market value decline, assessments rise because government costs do not stop growing.
We will see how long the “woke” corporate CEOs, Boards and Northside liberals stick around.
The “unwoke” have figured it out and are already leaving.

debtsor
4 years ago

The ‘woke’ leave too and bring their despicable politics to the suburbs. Lake County has been destroyed along with DuPage too.

Astonished
4 years ago
Reply to  debtsor

Back in Europe’s Middle Ages rats carrying Bubonic Plague-infected fleas were the carriers of pestilence that wiped out a third of Europe’s population…twice, if I recall correctly.

Leftists (progressives, democrats, terms are unimportant) are the rats of our times, they move from place to place spreading their Bad Ideas like a plague. They destroy one place (California is a good example) and when they don’t like what their lunacy produces, they move to uninfected states and ruin them, too.

debtsor
4 years ago

“The primary reason that Chicago is struggling from an investment-sales perspective is the outlook for higher taxes in the future,”

layperson speak: Assessor Kaegi

translation: progressive values really screw up the markets!

joe strzalka
4 years ago

Lincoln Yards will fix it

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“We are not in good shape” Wirepoints’ Ted Dabrowski told ABC 20 Champaign during a segment on Illinois’ latest population losses. Illinois was one of just three states to shrink in the 2010-2020 period and has lost another 300,000 people since then. Ted says things need to change. “It’s too expensive to live here, there aren’t enough good jobs and nobody trusts the government anymore. There’s just other places to go where you can be more satisfied.”

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