By Ted Dabrowski and John Klingner
Chicago’s top-dollar real estate market is taking a beating. That’s the news from a new Wall Street Journal article detailing the extent to which wealthy Chicagoans are taking big losses on their city properties. Billionaire Ken Griffin was the feature of the story, taking a massive hit on the sale of one of his most valuable properties. Rampant crime, high taxes, poor schools… all are pushing wealthy Chicagoans to leave, and that’s depressing property values.
But for all the attention the luxury market is getting, it’s the long-term weakness of Chicagoland’s overall home market that matters more. The same core problems that concern Chicago’s wealthiest impact everyday residents even more, and that’s hurting housing demand. Case-Shiller data shows that, despite recent strength, Chicagoland has suffered the 3rd-worst home value growth among the 20 cities in the index since 2000. Values are up just 108%, with only Detroit and Cleveland performing worse.
In contrast, cities like Los Angeles, San Diego and Miami have all seen their home values more than quadruple in value over the past 24 years.
Look at the Case-Schiller index over time and it’s even more obvious that Chicago home values dramatically lag behind most major cities over the long term.
A look at home values over a shorter period tells the same story. The median value of a home in Chicago has only grown 30% since 2010 – the lowest by far among the nation’s 15 biggest cities according to U.S. Census data (2010 is the earliest year available from the Census ACS). That’s not even enough to keep up with inflation, which was up 40% over the same period.
Read more from Wirepoints:
- Chicago property taxes rise 3.5 times faster than inflation in last decade
- Chicago’s black hole: Pension debts jump even though taxpayers pour billions into city funds
- Only half of Chicago Public Schools’ $10 billion in yearly spending makes it to the classroom
- Don’t look now, but here come the tax hikes on Illinoisans
Audio and summary 
If this bill passes, say goodbye to local control over all Illinois parks and expect to see open drug and alcohol use, needles, no sanitation and fire hazards, but no ordinary park users.
Wow. That’s some great company. Detroit and Cleveland. No problem. Nobody in your hellhole city seems to care.
How many of these sellers incurring huge losses and high end real estate brokers voted for Lightfoot, Foxx, Pritzker and Johnson? How many are members of the Chicago Club, Economics Club, Civic Federation and other so called leadership organizations? How many are lifelong democrats who vote for identity politics rather than sound policies that deliver fiscal and personal responsibility, public safety and accountability in public education? How many blindly donate to and vote for the same people, party and policies that have created this declining market? That $15.250M sale? The property taxes are over $333,000 a year! Will that buyer… Read more »
Talking about education, I am sure the rural south is incredible at it. Useless garbage Christian indoctrination with public tax dollars. GTFO with your stupid take on education. Agree with corrupt idiots running Chicago though.
You obviously have no idea of the low level of education coming out of chiraq.
I’m not critiquing southern states education results. Why are you? I commented on the local issue of declining real estate values. When high taxes don’t deliver public safety, decent schools and other quality of life services, there’s a clear problem with the people in power. If you’re trying to defend or criticize the outcomes of Chicago public schools without acknowledging the communist CTU that runs the system, brah…you need to spend a little more time on this site.
Ex Chicagoan, now rural Southerner here. Our education system is much better than Chicago’s, there are no thugs shooting at our kids, we spend way less tax money and get better results, we graduate a fine bunch of kids here, and after they graduate, due to our booming economy across many high tech industries, these kids get well paying jobs. So yes, the rural South is as incredibly good at as many things as Chicago is incredibly bad at. Y’all please enjoy paying your high taxes to the corrupt idiots. Too bad those politicians did not get indoctrinated properly to… Read more »
My late father lived in the Gold Coast. Founded a company with 77 offices around the globe. Was a member of the Chicago Club, Racquet Club, Chair of the Mid American Club when it was a viable club, and so on. He changed his voting patterns to Democrat figuring he had to go along to get along. I think he regretted doing that, but he was close with the Daley (junior) administration for whatever it’s worth. I did not have a relationship with him as he abandoned the family in the 70’s and my brother and I were on our… Read more »
Wow, thanks for sharing.
Mark – his wife attended Marian Catholic- that was the school that mattered in terms of her future.
Ooh, this is like the 20 Questions game! You’ve provided a great history test for Wirepoints readers to determine the identity of your father and grandfather! I confess I do not know without a little digging. If we answer correctly will you give us the name? Or at least answer clues as in 20 Questions?
My first question: Was International Harvester the company your grandfather was CEO of?
No not IH. A utility. He was Illinois Man of the Year in 1971. You mention IH. My mother’s family were servants for the McCormicks in Lake Forest. The McCormicks built a house for my mother’s family in appreciation which stands today across from the Bears headquarters. My mother loved working class people as a result and she was not pretentious. She was one herself. I do thank the McCormicks because that gift enabled me to go to great schools and lead a lucky life. By the way I was close to guys from the Southland. Bloom won the state… Read more »
Damn. With all those hints I should have it, but I don’t.
I disagree that high housing prices are a measure of success. It’s a good thing that Chicago’s housing prices remaining *relatively* affordable compared to other cities. But of course, there are awful reasons *why* Chicago’s growth is so anemic. Because high housing prices are a scourge on the economy. We are living in the super-bubble of all bubbles where the flow of the river of money washes over every tangible asset and artificially props up its value. This super bubble prevents new families and young people from buying homes and having children. The economy is some ways is just smoke… Read more »
I’ve wondered for years who in Chicago elects these feckless crooks with their bad policies. Guess I found one.
Sorry but 400K for a 1500 SF house is no bargain anywhere.
So, putting it another way, living in Chicago instead of some other U.S. cities cost many Chicagoans several hundred thousand dollars in net worth. Sounds about right.
That several hundred thousand dollars in net worth is predicated almost entirely on the ability of a Millennial or Zoomer to obtain a mortgage to purchase your home. When your net worth in some hot appreciating city is dependent on the finances of a debt-saddled generation, maybe it’s not such a good idea. I’ll have an easier time selling my house when i need to sell it in the future than the overpriced seller in some other state who overpaid himself. I lived through the 2007-2009 crash, and the five years of flat/declining prices afterwards.
I feel like prices never really retreated to where they should have after 08′. What in the world changed? I believe the answer to that is the value of the the dollar. If you look at a US home value chart over the last 100 years there is a nice steady conservative increase up to about 2000′, then everything is up and down like a yoyo from that point. It is all wall street driven from there on.
Here’s an article from Crain’s about the potential property tax bill Pritzker will get on in Chicago.
https://www.chicagobusiness.com/residential-real-estate/pritzkers-top-list-biggest-residential-property-tax-payers?utm-content=article1-headline
Time to take out the toilets!