According to a recent Crain’s article, the Chicago rental apartment market is at a record-breaking high.
The average monthly rent for apartments in a Class A (or top tier) downtown rental building rose over $3 per square foot, which is a new high, and rent is up 2.3% over the first quarter of 2017. Despite the addition of 4,348 apartment units in 2017, demand and occupancy remain strong at 93.2% for the first three months of 2018. During that same period, the increase of occupied downtown units was 1,397, which is a record for the for the first quarter.
This downtown apartment boom began shortly after the condo market crashed, at which time many people who considered purchasing balked at the falling prices and opted to rent instead. Many of those same people opted to keep renting to avoid the risk and hassle of purchasing.
All of these stats are great news for landlords, but for tenants it means paying much more despite those significant increases in supply. As an example, the average rent for 1,000 square foot Class A apartment is now $3,080 per month, up 43% since early 2010 when the average unit of the same size would go for $2,160.
What does this mean for Chicago corporate housing? Suite Home and other providers are rental entities, so we have experienced a substantially increased rental cost burden. Because of the special long-term relationships we have cultivated with management companies and our bulk renting history, sometimes the rent increases will be slightly less significant than to private renters, but unfortunately generally speaking Chicago furnished apartments cost more right now.
Will this trend continue? 19 buildings with over 6,600 units are under construction right now, so at some point the market is likely to adjust, but it will take some time. Until then expect to pay more to rent in downtown Chicago. As Chicago experts we can vouch it’s worth it!
Source article: http://www.chicagobusiness.com/realestate/20180521/CRED02/180529991