Chicago, IL (PRWEB) September 25, 2014
The United States economy has seen a recovery fueled by steady growth since 2009. The recession led to low interest rates matched with low property values. The Federal Reserve provided lower rates for banks to borrow money that translated into lower interest rates for perspective homebuyers to take out loans. The Federal Reserve Annual Rate hit a low in 2011 at .1%, compared to the most recent high in 2007 at 5.02%. This rate continues to stay below .2% through 2014. Such rates provide loan interest rates for residential families as low as the 4% to 5% range, depending on the circumstances. The supply of homes in the housing market increased due to foreclosures and short sales. This provides perspective buyers opportunities to purchase homes at a discounted rate. However, fewer American families had funds available to buy homes because of the recession. Gradually, more and more investors and families have been able to raise enough funds to take advantage of the low interest rates and cheap property values. Therefore, the demand for homes has slightly increased over the past few years, providing a steady increase in home values.
Specifically, Chicago’s real estate market continues to grow steadily. Chicago and its surrounding suburbs saw home and condominium average sales per month stay over 8,000 for both 2013 and 2014. This demonstrates that the residential real estate market continues to stay strong.
Commercial real estate is a great indicator of future real estate growth as commercial real estate often begins growth before residential real estate. This is because commercial real estate investors have more funds available to begin a new project in a promising area and quickly respond to market trends. In Chicago, the following types of real estate have enjoyed percentage increases from 2013 to 2014 so far: hotels 301%, industrial 55%, and office space 37%. Comparatively, Chicago apartments have only seen an increase of 2.8% from 2013, a slower growth for the residential real estate market.
In part, commercial growth drives residential growth as well. New residents generally flock to areas with new developments. A few hot neighborhoods continue to benefit from new developments. Logan Square, in particular, will soon see its large flea market located on the 2500 block of Milwaukee Avenue transformed into a newly renovated mega mall. Additionally, the City of Chicago has unveiled plans to renovate Logan Square’s Illinois Centennial Roundabout Monument, and the Chicago Transit Authority continues to remodel and update the Blue Line along the Logan Square area. These projects prove promising to the up and coming neighborhood as new residents flock to Logan Square and its surrounding areas.
While some hot spot neighborhoods enjoy rapid growth, generally Chicago continues to see steady growth citywide. However, the market suggests that the low interest rates and property values will not last for long. Prospective homeowners may want to take advantage of the buyer’s market while it still lasts.
Lattas, Felton and Minkus, LLC is a full service real estate law firm. To find out more about Bob Lattas and the services his law firm, Lattas, Felton and Minkus, LLC offer visit their website at http://www.lfmlawgroup.com.