Rising Home Values and Declining Ownership: North Chicago's Naval City Housing Trends
CATEGORY
Property Value
DATA
Percent Owner Occupied
Housing Prices
Median Rent
Population
DATA SOURCE
North Chicago, Illinois, located in Lake County, is a city known for hosting the Great Lakes Naval Training Center, which plays a significant role in the U.S. Navy's operations. Over the past decade, North Chicago has experienced notable shifts in its housing market, with homeownership rates declining and average home prices showing substantial growth.
The homeownership rate in North Chicago has seen a steady decline from 41% in 2013 to 34% in 2022. This downward trend coincides with a significant increase in average home prices, which rose from $47,269 in 2013 to $150,768 in 2022, representing a remarkable 219% increase over nine years. The inverse relationship between homeownership rates and average home prices suggests that rising property values may be making homeownership less attainable for many residents.
Federal interest rates have played a role in shaping homeownership trends in North Chicago. From 2013 to 2020, interest rates remained relatively low, ranging from 0.09% to 2.16%. Despite these favorable borrowing conditions, homeownership rates continued to decline, indicating that other factors, such as rapidly increasing home prices, may have outweighed the potential benefits of low interest rates for potential buyers.
As homeownership declined, the percentage of renters in North Chicago increased from 59% in 2013 to 66% in 2022. Average rent prices also showed an upward trend, rising from $1,075 in 2013 to $1,217 in 2022, an increase of about 13%. The growth in the renter population and rent prices, though not as dramatic as the rise in home prices, suggests a shift towards a more rental-oriented housing market in the city.
In 2023 and 2024, the housing market in North Chicago continued to evolve. The average home price reached $161,124 in 2023 and further increased to $174,350 in 2024, representing a 15.6% increase from 2022 to 2024. This growth occurred despite a significant rise in federal interest rates, which jumped to 5.02% in 2023 and 5.33% in 2024, potentially impacting affordability for prospective homebuyers.
Looking ahead, based on the historical data and current trends, we can project continued growth in both average home prices and rent prices over the next five years. Average home prices could potentially reach around $220,000 by 2029, assuming a similar growth rate to recent years. Average rent prices might increase to approximately $1,400 per month in the same timeframe, reflecting the ongoing demand for rental properties in the area.
In summary, North Chicago has experienced a significant shift in its housing market over the past decade. The decline in homeownership rates, coupled with substantial increases in average home prices, points to growing affordability challenges for potential buyers. The rise in the renter population and steady increase in average rent prices further underscore the changing dynamics of the city's housing landscape. As North Chicago continues to evolve, these trends are likely to shape the city's housing market and community composition in the coming years.
