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Downtown Condo Prices Finally Return to Pre-Bust Levels: Report

By David Matthews | February 10, 2016 1:17pm | Updated on February 10, 2016 9:57pm
 Trump International Hotel & Tower and other Downtown condominium buildings.
Trump International Hotel & Tower and other Downtown condominium buildings.
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Flickr/mindfrieze

CHICAGO — Downtown condominiums are finally worth more than they were before the real estate crash began seven years ago, according to a new report.

Downtown condo sale prices in the second half of last year were 1.7 percent higher on average than their peak level in 2008, according to a survey released Tuesday by Chicago-based Appraisal Research Counselors. Downtown condos sold for an average of $421 per square foot in the second half of 2015, up from the previous high of $414 per foot in 2008. 

Appraisal Research Counselors, a consulting firm that follows Downtown real estate development and prices, surveyed 65 large, high-rise towers including more than 20,000 condos across all price points from North Avenue to Cermak Road. The survey only included resales in towers that have been sold out since 2007, and not developer sales in new projects. 

Prices in surveyed Loop towers rose the most, at seven percent compared to 2008. West Loop prices followed at five percent, with River North prices rising four percent and Gold Coast buildings posting a one percent increase. Surveyed South Loop buildings were still two percent lower than their 2008 peak on average, and Streeterville buildings were still down four percent. 

The firm attributed the rise in prices to slipping foreclosure activity Downtown, as well as a limited pipeline of new condos being built. The vast majority of new residential towers being built Downtown are apartment buildings. 

Speaking of apartments ...

Despite a record number of apartment towers being built Downtown, Appraisal Research Counselors expects rents will still rise, according to Crain's. Nearly 9,000 new apartments will be built Downtown by the end of 2017, increasing the area's rental stock by 28 percent, but Appraisal Research still forecasts rents to modestly rise amid the lack of condo options.

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