Chicago’s share of $1M plus listings creeps up, while other cities drop

Chicago’s share of home listings over $1 million has grown, even as the housing market trudges through a slowdown and stock at or above that benchmark in coastal cities dissipates.

The Windy City’s total number of sellers seeking at least $1 million is much smaller in some of the cities where such listings have fallen. Yet the fact such homes on the market have increased at all makes Chicago an outlier, with the slice of listings above that point rising to 3 percent as of January from 2.7 percent in January 2022, according to Redfin data.

While the rise was slight, it occurred as markets with a much larger market share of $1 million-plus homes experienced a fallout of such listings. In places like New York and San Francisco — where $1 million homes are standard — the segment of homes priced at or higher than that shrunk between six and three percentage points of market share in the same period. 

In San Francisco, 80.3 percent of listings are over $1 million, down six percentage points from 86.3 percent last year. In New York, 29.5 percent of listings are at or over $1 million, down three percentage points from 32.5 percent during the same time period last year. 

Chicago’s increase is likely due to tight inventory at and near the $1 million mark, giving sellers in the market confidence they can hit the price point due to the dearth of other options, said Jeff Lowe, a Compass broker who led The Real Deal’s Chicago residential brokerage ranking last year with $381 million in sales volume on 291 deals.

“I listed a house in Roscoe Village last week for $1.8 million and we had three offers over $1.9  million and it sold for $100,000 over list price, just because there’s a lack of inventory,” Lowe said. “These are small infill neighborhoods, whether it’s Bucktown or Wicker Park or Roscoe Village or Lincoln Park or Lakeview. They’re just not big geographic areas. And there haven’t been a lot of people listing their homes this year.”

People who could hypothetically sell are locked into low mortgage rates, putting further inventory strains on the city’s market.

“We’re not necessarily raising our prices aggressively right now — but we’re certainly not lowering them either. So it’s not like we’re seeing things that were $1.5 million go to $950,000. If anything $1.05 million is going to $1.075 million or $1.1 million,” Lowe said.

Meanwhile, Chicago’s higher tier of luxury homes — anything priced at or above $4 million — is a more nuanced market.

Condos and co-ops in that range have a lot more inventory, and may not be sell for as much or as quickly as single-family homes in the same high-end segment, which, Lowe added, has remained strong when the assets are priced correctly.

As the spring market gets underway, Lowe will be watching inventory, anticipating it continues to shrink through the second quarter, as well as time on market.

“I don’t imagine we’re gonna see a flood of inventory because February, March, April and May are the biggest listing months of the year for us,” he said. “I have more product coming to market, but it’s not like it’s enough for the buyer demand that’s out there.”