Five Reasons Chicago is a Great Investment for Home Buyers
Legendary American author Mark Twain once famously quipped to a reporter that news of his death had been greatly exaggerated. Similarly, we Chicagoans frequently find ourselves in the position, these days, of having to remind others that our city is not only still alive, but is thriving in many ways.
While major cities throughout the greater Midwest struggle to reinvent themselves, Chicago has remained economically viable and vibrant despite a flurry of negative headlines. Tourism figures continue to break records, a revitalized downtown has drawn numerous new corporate headquarters and expansions, and the city’s vast housing stock remains quite affordable relative to other major metros – both nationally and internationally.
These exciting points of progress do come as Chicago grapples with a decline in population over the last few decades, and with underfunded public pension obligations that pose a serious threat to city and state finances. Nevertheless, there are a number of unique and integral features that put Chicagoans in a position to reap long-term benefits from living, working and owning real estate in the area.
Simply put, Chicago is a fantastic place to live, and there are numerous reasons why any home buyer can feel confident claiming a piece of the American Dream for themselves in the Windy City. Here are five integral factors that bolster the long-term prospects for Chicago’s housing market.
A Highly Educated Workforce
Chicago has one of the most highly educated workforces in the country, according to a 2017 analysis of U.S. census data performed by the Central Area Committee, and reported by Crain’s Chicago Business. Fueling the local brain gain is the Big 10, which funnels thousands of college grads into Chicago each year from top-ranked universities, including Illinois, Michigan, Wisconsin, Indiana and of course Northwestern. The latter along with the University of Chicago also make up two of the top 10 graduate business schools in the country. And colleges such as UIC, DePaul, Loyola and others further strengthen Chicago’s educational credentials. The result is that employers find a rich pool of talent that is generally less expensive than on the coasts, making Chicago a very attractive headquarters location.
A Great Lake
The Great Lakes region contains some of the largest freshwater bodies in the world. In fact, Lake Michigan often surprises first-time visitors to Chicago who discover they cannot see the opposite shore. Lake Michigan provides an almost coastal feel with miles of sandy beaches and numerous marinas. And the lake, along with the Chicago River, not only are crucial components to the city’s recreational offerings, they also play a meaningful role in regional commerce. Chicagoans also look to our lake for sustenance. And in an era where concern over the earth’s natural resources is continually growing, having direct access to, and control over, something as precious as fresh water is as good as gold in the 21st century.
There is no single industry that claims more than 12% of Chicago’s workforce. Such a diversified economy insulates the city and the housing market from both sector-specific and macro booms and busts. Economists often cite the fact that Chicago “lags the coasts,” and we’ve come to understand this as a positive. Yes, we miss out on the high highs of a Seattle, San Francisco or Miami, but, more importantly, we avoid the low lows. The last decade has seen numerous legacy corporations move back downtown from suburban campuses. Meanwhile, some of the biggest names in tech have opened or expanded regional offices here. There’s a reason why Chicago has led the nation in corporate relocations and expansions for six years in a row.
The Nation’s Transit Hub
At the beginning of the 20th century, an explosion of new jobs in manufacturing, finance, agriculture, and retail not only brought millions of people to the city, but also laid the groundwork for Chicago to become a vital transportation hub for both passengers and freight. Today, this reputation continues to be expressed through Chicago’s burgeoning logistics industry. The city also boasts two international airports, and a massive expansion currently underway at O’Hare will only ensure that Chicago remains competitive well into the 21st century. Not to be overlooked, Chicago’s public transit system, though aging, is one of the best in the world.
Affordable Housing Stock
Finally, no other major American city offers all of these attributes and benefits at a lower cost of living. Housing prices in coastal cities continue to climb at exponential rates, pricing out workers and small businesses. Meanwhile Chicago remains accessible to those who wish to purchase a single family home, condo, or multi-family building. Compare Chicago’s $275,000 median sale price to Miami’s $325,000, New York’s $600,000, L.A.’s $748,000, or San Francisco’s mind-blowing $1.47 million to illustrate the difference in housing costs. Of course, ultra luxury buyers have plenty of high-end options in the city’s upscale neighborhoods, but homeownership is not exclusive to the ultra-wealthy in Chicago.
While outsiders and pessimists are all too willing to focus on the negative issues that weigh on our city, Chicagoans have – over the past 180 years – come to understand, build upon, and leverage our inherently unique attributes in ways that create value for the city and the nation. It is these attributes that inspire a bullish view on Chicago’s economic future and our long-term outlook for real estate investment.
Very informative, thanks AJ! Chicago is awesome indeed.