June 2016

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Page 34 of 97 | Mobility 31 T he northeastern Illinois market is made up of Cook County, which contains the city of Chicago, and the five surrounding "collar counties" of Lake, McHenry, DuPage, Kane, and Will. The city of Chicago, with a population of around 2.7 million, is the area's primary economic engine. This report focuses on Cook and DuPage counties, as they are the most populous counties and see the greatest amount of relocation activity. These two counties contain more than 6 million residents and account for around 80 percent of the population in the northeastern Illinois market. LOOKING BACK Housing prices in the northeastern Illinois market increased from 1997 through 2007. Some areas saw market peaks in 2007, while others continued to see appreciation through the third quarter of 2008. The Great Recession hit in earnest in September 2008 and brought value declines to all markets. However, the magnitude of the decline varied sig - nificantly. The greatest percentage losses were typi- cally seen in communities that entered the recession with a median home value that was below average for the region. Some communities began to see values move upward in 2012. However, the most severely impacted areas did not see an upward trend in value until early 2014. The rate of recovery in Cook County for detached home values varies dramatically from one area to another. High-demand areas in the city of Chicago have seen the strongest recovery. For example, the Lincoln Park neighborhood had a median detached home value of $1,425,000 in 2007. The median value in this neighborhood dropped 11 percent by 2011. However, by 2015 the median value was more than 11 percent above the prior peak in 2007. Median detached home values above the prior peak in 2007 can also be seen in other areas of the city of Chicago, such as West Town and Lincoln Square. These locations all have strong transportation links to the central business district, and residents have rising levels of disposable income. The availability of vacant land in the high-demand areas of the city of Chicago has kept additions to the detached home supply at a relatively low level, and most building is on an infill basis. The city of Chicago is seeing the greatest competition from new construction in the upper end of the market (homes priced above $1.5 million). None of the suburban areas of Cook County have seen median home values push back up to the prior peak levels. The highest-demand areas in suburban Chicago Market By Kevin P. Maloney MARKET SUMMARY

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