Q4 Chicago Multifamily Market Report
Market Overview
Chicago’s multifamily market is a dynamic and robust sector that continues to show promising signs. While certain regions across the country are experiencing slowing rent growth and a decline in absorption, the Chicago multifamily market has remained stable. This positive trend is expected to persist in the present and near future, indicating a solid and sustainable market condition. The resilience of the multifamily market can be attributed to the absence of new residential supply, particularly in the quiet neighborhoods and suburban areas. Investors are drawn to Chicago not for the pursuit of rapid population and rental growth but rather for the market’s overall stability as one of the largest metro areas in the nation.
Market Performance
The market continues to exhibit robust demand, adding another 7,800 units over the past 12 months. Every class in Chicago’s multifamily market has shown an increase in absorption over the same period. As of Q4 2023, Chicago’s year-over-year (YOY) (rent growth is about four times the national average at 2.5%. This marks the first instance in over a decade that Chicago has sustained a rent growth surpassing the national average. Among the top 10 areas with the largest inventory, Chicago, the sixth largest, boasts the highest rent growth. While several metro areas are having oversupply issues, Chicago’s inventory increased by a mere 2.3% in the last 12 months. This growth is less than half of the national average during H2 2023.
The current 12-month sales volume is $3.9 billion, and the market experienced the smallest YOY drop in multifamily sales volume among the 27 largest markets based on inventory.
By The Numbers | Last 12 Months | Source: CoStar Group
- Vacancy Rate: 5.6%
- Rent Growth: 2.7%
- Delivered Units: 9,903
- Absorbed Units: 7,839
- Sales Volume: $3.9B
To read a previous Chicago multifamily market report, click here.
