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Chicago Tribune
30-06-2025
- Business
- Chicago Tribune
Column: Lake County homebuilding trying to meet demand
If Illinois is facing a severe housing shortage, Lake County is doing its fair share to make up some of the deficit. Construction of new apartments, condos and houses abounds in this corner of the region. A recent study asserts the Land of Lincoln has a shortage of about 142,000 housing units — that's about the size of everyman's Peoria. To keep pace with demand over the next five years, some 227,000 homes need to be built to keep pace with demand. The survey from the Illinois Economic Policy Institute and the Project for Middle Class Renewal at the University of Illinois Urbana-Champaign also found that the state has a more affordable housing market than New York City and Los Angeles. Yet, the housing shortage will cause the affordability index to rise in the coming years. Researchers mined U.S. Census Bureau data and determined the state's vacancy rate for rental and owner-occupied units has reached historic lows. Home values have gone up 37% in the state since 2019, the report found, with insurance and property taxes also rising. The median sale price for existing homes in the U.S. is about $438,466, according to real estate brokerage firm Redfin. Illinois, too, has a higher rate of homeownership compared to the national average. Gov. JB Pritzker, who announced he is running for a third gubernatorial term last week, has listed housing availability and affordability as a key concern of his administration, but has done little to make that happen, especially given the high property tax rates Illinoisans endure. In the past five years, the report found that new home listings in the state dropped by 64%; new housing construction permits fell by an average of 13%. The real estate market for used homes has seen a dip in inventory of stock because many senior citizens have decided to stay in their current houses. Also, higher mortgage rates and increased building costs, which may be aggravated by President Donald Trump's ongoing tariff wars, have affected the housing sector. For many, though, it is housing affordability that causes them to miss out on one of the American dreams, home ownership, causing them to rent longer. Another recent study, this one from an Austin, Texas-based real estate listings website, noted the typical American household needs to earn $114,000 in order to buy a median-priced home. That's an increase of $47,000 from 2019, according to A recent Gallup Poll found that only 36% of respondents are satisfied with affordable housing in their communities. According to the National Association of Realtors, the age of first-time homebuyers is 38. In the late 1980s, it was 27. That should tell policy planners that there's a disconnect among would-be homebuyers and current market conditions. Housing affordability, experts say, means that a mortgage payment, including insurance and taxes, should make up 30% or less of monthly income. Demand, however, appears to be fueling new housing construction across Lake County and other locations in the region. In Kane County, west of Elgin, a plan to build 900 housing units on a broad swath of what was once farmland near rural La Fox has been proposed. In Kendall County, a development with luxury apartments is underway in downtown Oswego. Waukegan, with an affordable and wide mix of housing stock, is seeing an uptick in building plans, including repurposing the old YMCA at County and Clayton streets downtown. A proposal, with the help of city funding, would turn three floors of the building into 19 upscale apartments, with the bottom floor reserved for commercial space. In Gurnee, three sizable apartment buildings off Milwaukee Avenue, overlooking Interstate 94, have been under construction for more than a year. Village officials, too, have to decide on what form the property along Washington Street, west of Milwaukee back to the tollway, will take. Libertyville has seen new townhomes on Peterson Road, west of Milwaukee, on property which once was the Iron Horse Par 3 golf course and Hitchin Post Motel and restaurant. Renters have moved into the apartment complexes straddling the Canadian National Railway line in downtown Mundelein, which is also seeing a new barbecue restaurant opening nearby at Park and Seymour avenues. Multi-family housing is also underway along Butterfield Road, just north of Allanson Road. The village has seen thousands of new housing units built since 2010, according to one reckoning. Mundelein is also home to the current development elephant in the county: The 700-acre Wirtz property on the village's western edge, dubbed Ivanhoe Village. The property has been in the Wirtz family, which owns the Chicago Blackhawks and is part-owner of the United Center, for more than 150 years. Initial proposals call for thousands of homes to be built on the property, phased in over a 25-year timeline. As construction continues and begins on these housing projects and more across the county, municipal officials need to consider making homes and apartments affordable for new and current residents. Uncertain times call for certainty when it comes to putting roofs over people's heads.
Miami Herald
24-06-2025
- Business
- Miami Herald
Illinois must build 227,000 units in 5 years to keep up with housing demand, report finds
Illinois has a shortage of about 142,000 housing units and must build 227,000 in the next five years to keep pace with demand, a number that would require recent annual production rates to double, according to a new economic study. The joint study published Tuesday by the Illinois Economic Policy Institute and the Project for Middle Class Renewal at the University of Illinois Urbana-Champaign found that although the rental and for-sale housing markets in Chicago and Illinois as a whole remain more affordable than many coastal cities, such as New York and Los Angeles, and some other states, Illinois still faces a severe housing shortage that is escalating affordability challenges. National housing shortage estimates are wide-ranging, with Freddie Mac citing 3.7 million and the National Association of Realtors reporting 5.5 million. "Prosperity and economic growth require people not only working, but then investing in their communities," said report co-author Robert Bruno, a professor of labor and employment relations at the U. of I. and director of the Project for Middle Class Renewal. "A key asset is having a place to live. And there are multiple ways that you can provide that housing … and Illinois could be doing a better job." The researchers, who analyzed U.S. Census Bureau data, found that housing demand in Illinois has been fueled by numerous factors, including rising incomes, robust employment and population growth and higher rates of homeownership compared to the national average. Meanwhile, in the past five years, the report found that new home listings dropped by 64%, new housing construction permits fell by an average of 13% and the state's vacancy rate for both rental and owner-occupied units reached historic lows. Home values have gone up 37% in the state since 2019, the report found, with insurance and property taxes also rising. Rent prices in Chicago show no signs of easing either. In May, rents in Chicago increased 2% compared with 0.4% nationally, which was the second-fastest month-over-month rent growth of the nation's largest 100 cities, according to Apartment List. The city's year-over-year rent growth stands at 5%, landing it in fourth place for fastest growth among the nation's 100 largest cities. The real estate market for for-sale homes has been experiencing significant housing inventory challenges in recent years because of higher mortgage rates, keeping prices elevated and would-be homebuyers renting for longer. The report also found that investors have been icing out everyday homebuyers by snatching up homes with all-cash offers in the Chicago area, with the investor-owned share of the housing market increasing from 8% in 2010 to 14% in 2023. Red tape, such as zoning laws and minimum parking requirements, have limited new construction as well. While Mayor Brandon Johnson and Gov. JB Pritzker have touted housing availability and affordability as key concerns and priorities of their administrations, the task to overcome the city and state housing shortages has become a heftier one. Land can be scarce; bureaucratic red tape that impedes construction can be abundant; building material costs are high and potentially are getting higher with President Donald Trump's constantly evolving trade wars; and local, state and federal funds available to subsidize the burgeoning development costs are getting more limited in some instances because of fiscal challenges, issues that are exacerbated by a federal government that is eager to use far-reaching powers to control state and institutional purse strings and is focused on axing spending. The report comes as Johnson has made significant investments in an effort to mitigate the shortage, while the state recently reduced the amount of budgetary funds that go toward housing for the 2026 fiscal year beginning July 1 by more than $26 million, a roughly 9% decrease. The reduction in funds hit as area housing groups who rely on city, state and federal dollars are already struggling to provide subsidized housing to some of the lowest income residents in the state as they are facing multimillion-dollar budget shortfalls. About a year ago, Johnson launched the Cut the Tape initiative which aims to reduce the bureaucratic red tape to speed up housing development and, in turn, reduce costs; affordable housing developers say they are still awaiting tangible changes resulting from this initiative. The Johnson administration recently created two new programs to build "green social housing" and "missing middle" housing as well. The former seeks to create mixed-income rental buildings that are built to certain energy efficiency and decarbonization standards and in which at least 30% of the units are affordable. The city would own a majority stake in the buildings, a first-of-its-kind role for Chicago. The latter allows investors to buy city-owned lots for $1 each and receive up to $150,000 per unit to subsidize construction costs. The goal of the missing middle program is to build low-cost, for-sale homes on the South and West sides, potentially reversing a decades-long population decline in disinvested communities. Johnson has said one of his top goals as mayor is to make Chicago the "safest, most affordable city in America," and has cited an uptick in tourism, downtown hotel occupancy and annual census numbers as proof of results. The green social housing program is expected to be seeded with $135 million and the missing middle program comes with $75 million, with the dollars coming from the city's $1.25 billion housing and economic development bond. "It is good to have the commitment, great to have the dollars invested," Bruno told the Tribune, "but then what knot do you have to untie … so that you can start really building more affordable housing?" An ordinance allowing for more accessory dwelling units, which are independent residential units on the same lot as a home, has stalled for over a year, with aldermen in the bungalow belts resisting because they are worried about density in their single-family home neighborhoods. How can Chicago and Illinois lawmakers address the housing shortage and affordability challenges? The authors suggest a variety of solutions, some of which Chicago officials and other state leaders are already working on, including easing zoning restrictions, quickening permitting processes, offering tax incentives to convert commercial buildings to residential units and increasing surtaxes on short-term rentals such as Airbnb. Aldermen recently took a step toward giving themselves the power to ban Airbnb and other short-term rentals from opening in their wards, a move that could potentially lead to an increase in housing supply. "While policymakers in Illinois cannot dictate national mortgage rates or tariffs on imported lumber and steel, they can take action to reduce barriers for prospective buyers, renters and developers," said report co-author Frank Manzo, an economist at the Illinois Economic Policy Institute, a La Grange-based nonpartisan research organization. "And the data certainly argues in favor of policy changes that boost supply in order to improve affordability." (Chicago Tribune's Alice Yin and Jake Sheridan contributed.) Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Chicago Tribune
24-06-2025
- Business
- Chicago Tribune
Illinois must build 227,000 units in 5 years to keep up with housing demand, report finds
Illinois has a shortage of about 142,000 housing units and must build 227,000 in the next five years to keep pace with demand, a number that would require recent annual production rates to double, according to a new economic study. The joint study published Tuesday by the Illinois Economic Policy Institute and the Project for Middle Class Renewal at the University of Illinois Urbana-Champaign found that although the rental and for-sale housing markets in Chicago and Illinois as a whole remain more affordable than many coastal cities, such as New York and Los Angeles, and some other states, Illinois still faces a severe housing shortage that is escalating affordability challenges. National housing shortage estimates are wide-ranging, with Freddie Mac citing 3.7 million and the National Association of Realtors citing 5.5 million. 'Prosperity and economic growth require people not only working, but then investing in their communities,' said report co-author Robert Bruno, a professor of labor and employment relations at the U. of I. and director of the Project for Middle Class Renewal. 'A key asset is having a place to live. And there are multiple ways that you can provide that housing … and Illinois could be doing a better job.' The researchers, who analyzed U.S. Census Bureau data, found that housing demand in Illinois has been fueled by numerous factors, including rising incomes, robust employment and population growth and higher rates of homeownership compared to the national average. Meanwhile, in the past five years, the report found that new home listings dropped by 64%, new housing construction permits fell by an average of 13% and the state's vacancy rate for both rental and owner-occupied units reached historic lows. Home values have gone up 37% in the state since 2019, the report found, with insurance and property taxes also rising. Rent prices in Chicago show no signs of easing either. In May, rents in Chicago increased 2% compared with 0.4% nationally, which was the second-fastest month-over-month rent growth of the nation's largest 100 cities, according to Apartment List. The city's year-over-year rent growth stands at 5%, landing it in fourth place for fastest growth among the nation's 100 largest cities. The real estate market for for-sale homes has been experiencing significant housing inventory challenges in recent years because of higher mortgage rates, keeping prices elevated and would-be homebuyers renting for longer. The report also found that investors have been icing out everyday homebuyers by snatching up homes with all-cash offers in the Chicago area, with the investor-owned share of the housing market increasing from 8% in 2010 to 14% in 2023. Red tape, such as zoning laws and minimum parking requirements, have limited new construction as well. While Mayor Brandon Johnson and Gov. JB Pritzker have touted housing availability and affordability as key concerns and priorities of their administrations, the task to overcome the city and state housing shortages has become a heftier one. Land can be scarce; bureaucratic red tape that impedes construction can be abundant; building material costs are high and potentially are getting higher with President Donald Trump's constantly evolving trade wars; and local, state and federal funds available to subsidize the burgeoning development costs are getting more limited in some instances because of fiscal challenges, issues that are exacerbated by a federal government that is eager to use far-reaching powers to control state and institutional purse strings and is focused on axing spending. The report comes as Johnson has made significant investments in an effort to mitigate the shortage, while the state recently reduced the amount of budgetary funds that go toward housing for the 2026 fiscal year beginning July 1 by more than $26 million, a roughly 9% decrease. The reduction in funds hit as area housing groups who rely on city, state and federal dollars are already struggling to provide subsidized housing to some of the lowest income residents in the state as they are facing multimillion-dollar budget shortfalls. About a year ago, Johnson launched the Cut the Tape initiative which aims to reduce the bureaucratic red tape to speed up housing development and, in turn, reduce costs; affordable housing developers say they are still awaiting tangible changes resulting from this initiative. The Johnson administration recently created two new programs to build 'green social housing' and 'missing middle' housing as well. The former seeks to create mixed-income rental buildings that are built to certain energy efficiency and decarbonization standards and in which at least 30% of the units are affordable. The city would own a majority stake in the buildings, a first-of-its-kind role for Chicago. The latter allows investors to buy city-owned lots for $1 each and receive up to $150,000 per unit to subsidize construction costs. The goal of the missing middle program is to build low-cost, for-sale homes on the South and West sides, potentially reversing a decades-long population decline in disinvested communities. Johnson has said one of his top goals as mayor is to make Chicago the 'safest, most affordable city in America,' and has cited an uptick in tourism, downtown hotel occupancy and annual census numbers as proof of results. The green social housing program is expected to be seeded with $135 million and the missing middle program comes with $75 million, with the dollars coming from the city's $1.25 billion housing and economic development bond. 'It is good to have the commitment, great to have the dollars invested,' Bruno told the Tribune, 'but then what knot do you have to untie … so that you can start really building more affordable housing?' An ordinance allowing for more accessory dwelling units, which are independent residential units on the same lot as a home, has stalled for over a year, with aldermen in the bungalow belts resisting because they are worried about density in their single-family home neighborhoods. How can Chicago and Illinois lawmakers address the housing shortage and affordability challenges? The authors suggest a variety of solutions, some of which Chicago officials and other state leaders are already working on, including easing zoning restrictions, quickening permitting processes, offering tax incentives to convert commercial buildings to residential units and increasing surtaxes on short-term rentals such as Airbnb. Aldermen recently took a step toward giving themselves the power to ban Airbnb and other short-term rentals from opening in their wards, a move that could potentially lead to an increase in housing supply. 'While policymakers in Illinois cannot dictate national mortgage rates or tariffs on imported lumber and steel, they can take action to reduce barriers for prospective buyers, renters and developers,' said report co-author Frank Manzo, an economist at the Illinois Economic Policy Institute, a La Grange-based nonpartisan research organization. 'And the data certainly argues in favor of policy changes that boost supply in order to improve affordability.' ekane@
