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Back of the Yards: Rising Home Values Amid Declining Ownership in Former Meatpacking Hub
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
Loading Content...
Property Value
Percent Owner Occupied
Housing Prices
Median Rent
Population
Back of the Yards, a historic Chicago neighborhood with an industrial legacy, has experienced significant changes in its housing market over the past decade. This analysis examines the trends in homeownership rates and housing prices from 2013 to 2024, reflecting broader economic shifts and local developments. The homeownership rate in Back of the Yards has shown a notable decline from 2013 to 2022. In 2013, 38% of residents owned their homes, but this figure dropped to 34% by 2022. Concurrently, there was a substantial increase in average home prices. The average home price in 2013 was $49,667, which more than tripled to $148,694 by 2022. This inverse relationship suggests that rising home prices may have made homeownership less accessible for many residents.
Federal interest rates have played a significant role in shaping homeownership trends in Back of the Yards. From 2013 to 2016, when interest rates were historically low (ranging from 0.11% to 0.4%), the homeownership rate remained relatively stable at around 35-37%. However, as interest rates began to rise more significantly from 2017 (1%) to 2019 (2.16%), homeownership rates declined to 33%. This trend aligns with the general principle that lower interest rates tend to encourage homeownership due to more affordable financing options.
The renter population in Back of the Yards has grown as homeownership has declined. In 2013, 62% of residents were renters, increasing to 66% by 2022. Average rent prices have remained relatively stable during this period, with some fluctuations. In 2013, the average rent was $820, and it rose slightly to $866 in 2021 before decreasing to $815 in 2022. This stability in rent prices, despite the increasing renter population, suggests that the rental market has been able to absorb the growing demand without significant price pressure.
In 2023 and 2024, the housing market in Back of the Yards continued to evolve. The average home price in 2023 was $149,590, showing a slight increase from 2022. In 2024, the average home price rose further to $160,933, indicating a continued upward trend in property values. Federal interest rates increased significantly during this period, reaching 5.02% in 2023 and 5.33% in 2024. These higher interest rates may impact future homeownership trends in the neighborhood.
Based on historical trends and current market conditions, projections suggest continued growth in average home prices in Back of the Yards over the next five years. Average home prices could reach approximately $185,000 to $200,000 by 2029. Rent prices are expected to follow a more moderate upward trend, potentially reaching an average of $900 to $950 per month by 2029. These projections are subject to various economic factors and local market conditions.
In summary, Back of the Yards has experienced a significant decrease in homeownership rates coupled with a substantial increase in average home prices over the past decade. The rental market has grown, with stable rent prices despite increased demand. Recent years have seen continued growth in home values alongside rising interest rates. These trends reflect the changing dynamics of the neighborhood's housing market and may have important implications for its residents and future development.
