According to the Chicago Tribune, a construction boom has nearly doubled the supply of luxury apartments in Chicago since 2015 and apartment building in the suburbs is on track to break records. Despite the surge, doubts remain about the future. “We have a change in the governor, change in the mayor, change in the assessor,” said Integra Realty resources senior managing director Ron DeVries, “There’s just a lot of uncertainty out there right now.”
Expected property tax increases, potential changes to affordable housing requirements and the specter of some form of rent control could potentially push down the profitability of existing apartment buildings and new developments. A slowdown in apartment construction likely would push up rents for downtown residents. “We could be seeing a shortage of units in two to three years. Hard to believe that, right?” DeVries said.
But renters continue to fill new apartments downtown, and the number of units completed is expected to slow to 3,500 in 2020 and 2021.“The market’s going to tighten up,” DeVries said. “You’re going to see increased occupancy and (landlords) trying to drive rents (up) through that period.”