Yes. Whether you’re planning to go for traditional real estate investing or Airbnb, we highly encourage you to consider Chicago real estate investing. Do not fear it and simply assume that it is too expensive for you to afford. Check out the reasons why we recommend it and thank us later…
Prices are a bargain right now
Chicago’s population has risen at about half of the national rate for many years now. This has caused prices to go down significantly below income level. This is good news for Chicago real estate investing–so good news for you! But, studies show that in the next few years, there will be an increase of approximately 4% in home prices.
And because prices are expected to go up, mortgages are now having below average risk. So, there’s really a bargain on properties in Chicago right now. It’s a nice opportunity window that might close soon. Keep reading for more reasons and for suggestions on which neighborhoods to check out.
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Young Demographic
The median age in Chicago is 34, with the majority of the population (18% to be exact) are between the ages of 20 and 29; while, 17% of the population lie in the age range of 30 to 39. This young demographic means that a large number of the population is single or has a small family. For Chicago real estate investing, this means that the population will mostly likely rent, rather than purchase homes. And it specifically tells you that there’s a need for small homes or apartments.
Job Cuts
There are some job cuts to be expected, especially in manufacturing industries. This is terrible news for most, but not for you if you’re interested in Chicago real estate investing. These job cuts translate into people not being able to afford the expected increases in home prices. With less people able to afford buying new homes, they will be looking to rent.
Number of housing starts are over the roof
Housing starts are homes that are being under construction. Data shows that the number of housing starts will have reached 6,250 by the end of this year. This is a huge number! In fact, this means that there has been an increase of 5.6% in Chicago’s housing starts. This is the highest number for Chicago in seven years. It is also good news for Chicago real estate investing. Housing starts are one of the important indicators that show an area’s economic growth. There’s a huge interest in the area and individuals are interested in being there.
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Visitors (tourists and work travelers) numbers are also over the roof
Of course there’s great news for Airbnb Chicago real estate investing as well. Chicago is one of the United States’ most popular, beloved states. So, it comes as no surprise that last year, in 2015, the total visitation added up to 52.8 million. This number showed a 5.1% increase over 2014! But with the growth of Airbnb and other cheaper forms of lodging, demand for hotel rooms have declined. People really do prefer Airbnb. It’s cheaper and more convenient for most visitors.
If you decide to reside in your Airbnb, you’ll have a bonus with the International tourists. They usually like to use Airbnb because in addition to exploring a foreign country, they’ll like to be immersed with the culture by connecting with a local family. But, if you decide not to reside in you property and turn into an Airbnb real estate investing property, you can even begin to host businesses. Businesses also like the alternative lodging ideas and have begun to use Airbnb. So, you can market you Airbnb in a way that allows businesses to jump on the band wagon. Chicago is such a important city, so you will not run out of work travelers!
Now that we told you why you should go for Chicago real estate investing, here are some recommendations on where to start looking…
1. Here are the top five neighborhoods with the highest Airbnb occupancy rate, to narrow down your Chicago real estate investing search:
- Old Town Triangle: 67.5$
- Goose Island: 66.7%
- Lakeview: 65.6%
- Gold Coast: 65.3%
- Near north: 64%
Related Article: Airbnb Reviews: Top Influencers Affecting Your Occupancy Rate
2. Check out these five neighborhoods with highest average traditional rental income:
- Gold Coast: $2952/ mo
- Near East Side: $2,733/mo
- Near North: $2,647/mo
- Cabrini Green: $2,426.50/ mo
- West Loop Gate: $2,334/ mo
3. If you like the idea of Airbnb Chicago real estate investing, then here are neighborhoods with the highest average Airbnb rental income:
- West Loop Gate: $3,418.5/mo
- Cabrini Green: $3,162.5/mo
- Gold Coast: $3,234.4/mo
- Near North: $3,099/mo
- Old Town Triangle: $3,051.7/mo
4. And here are the neighborhoods with the lowest average median home prices:
- Lake View: $294,500
- Near East Side: $379,950
- Cabrini Green: $402,000
- West Loop Gate: $450,00
- Chicago Loop: $475,000
Just a final word…
Based on our thorough analysis, we recommend that you consider Chicago real estate investing. There’s a lot of potential to the city in terms of economic growth, demography, and housing market, just like the other major cities cities in the United States; and yet, the properties are listed at much cheaper prices.
Don’t waste your time and start looking at Mashvisor now to look for your perfect real estate property.