Tenants across the Chicago metropolitan area could see a bit of relief as rent prices have started to slowly decrease, according to a newly released report.
The month-over-month rental price in Chicago fell by about 1% from August to September, and the year-over-year figure for the area has also declined about 2%, according to a report from Rent., a digital company that provides marketing services in the real estate industry and is a Redfin company.
The median monthly rental price for the Chicago area stands at $2,389, down from September 2022, when that figure reached $2,437, according to the company. The median rental price is calculated by taking into account a variety of rental property sizes, from studios to three-bedrooms, said Jon Leckie, a researcher with the company.
The Chicago area has been spared from larger increases in rent that other parts of the country have experienced, he said. In New York City, the median rental price is $4,449, and that figure for Los Angeles is $3,575, Leckie said.
Still, the area followed a similar pattern of decreasing rental prices during the early part of the pandemic, followed by a period of increases in rental prices. Rents in Chicago increased by 17% last summer but have started to drop.
“Chicago has kind of been on this wild ride, but it seems like prices have leveled out to sort of where they were before the pandemic,” Leckie said.
Across the country, rent prices dropped by about 2% in September for the first time in six months, the report found. However, prices are still slightly higher than they were around this time last year. The national median rent price is $2,011, according to the report.
Leckie said some of the dips could be attributed to lower demand among tenants, mixed with more new construction.
But at least one renter, Suleha Khan, said rent prices still seem too high in the Chicago area.
Khan, 26, of Skokie, is a single mother of a 4-year-old girl, and she’s been on the hunt for a new apartment. It’s been a struggle to find an affordable unit in a neighborhood close to her daughter’s school, she said.
She has looked at apartments ranging from $1,400 to $1,800 a month, but she hasn’t had luck in securing a new home.
“I really don’t believe that it’s decreasing,” Khan said. “I think it’s increasing every single time, and it’s so hard to get nowadays a property for rent because a lot of average people, we make like $3,000 a month.”
Jason Wagner, a member of the Chicago-based Neighborhood Building Owners Alliance’s issues and policy group, says they are continuing to see rent prices increase within the boundaries of Chicago. However, monthly rental prices won’t rise as quickly.
The rental boom that took place during the coronavirus pandemic led to higher than average growth rates of rental prices, Wagner said. The market’s current growth rate is about 3.5%, but the city had typically experienced rents growing by 1% to 2% year over year.
“Rents will still increase but at a slower rate and getting back down to that normalization point is between 1% to 2%,” Wagner said.
More tenants are sticking to the same apartment, which could be contributing to a lower vacancy rate in the city, Wagner said. And while the city has made progress in building more units, Wagner said Chicago needs more apartments to bring down rental prices.
“The only way for rent prices to come down is if we have a lot more inventory that comes to the market, and we have a leveling out of the supply and demand,” he said.
Leckie recommended that anyone looking for an apartment hold off on moving until the winter if possible. Although the pandemic upended rental trends, prices are starting to follow the seasonal trends that had typically been the norm.
“Winters are probably not ideal to move in Chicago, but that’s when you are going to get the lowest prices,” he said. “That’s when demand is the lowest, and even among the volatile swings that we’ve seen in Chicago, the bottoms of those swings have happened closer to the winter months than they have to the summer months.”
