Chicago Q4 Multifamily Market Report: Minimal New Construction Easing Supply-Side Pressures
Highlights:
- Operating conditions softened in the Chicago multifamily market in 2020, but a recovery is likely to begin to take shape in 2021. The local labor market will likely begin to transition more fully into expansion mode in the second half of 2021, which should spark renter demand.
- Apartment vacancy in Chicago rose 70 basis points in 2020, ending the year at 5.9 percent. Conditions began to steady late in the year; the rate inched up just 10 basis points during the fourth quarter.
- After several consecutive years of strong growth, rents contracted in 2020. Asking rents fell 3.3 percent for the year, ending the fourth quarter at $1,476 per month.
- Apartment construction slowed, with developers delivering approximately 4,900 units in 2020. Projects totaling nearly 7,800 units are under construction.
- Sales of multifamily properties slowed in 2020, with the greatest drops in activity occurring in larger, newer assets.
