Analysis - River North Condo Market - April 2023 | Hudson Parker

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River North | May 2023

Who doesn't love data? We certainly do, which is why we pay such close attention to the River North condo trends and the analysis that will be discussed below. It's impossible for us realtors to truly work in your very best interest without a deep understanding of the data that leads to real-world fluctuations in supply and demand. While the data below supports a macro or high-level look at the current state of River North's real estate market, it's even more critical to analyze similar data in the specific building you hope to buy or sell. While collecting individual building data is far too time-consuming for a monthly real estate blog, it is an essential part of the valuation process for anyone hoping to successfully buy or sell a condo unit in River North. We're happy to share our knowledge, experience, and our analytical skills with you. Contact us today if you have specific questions on River North real estate. Our team is here to assist.

River North Condo | Sales Activity

April's River North condo sales were down 37% when compared to the same period in 2022. Check out the graph below of monthly condo sales and note that we're using a 3-month rolling average (month-to-month data is too volatile and may not accurately represent current market trends). You can see the outlier effects of COVID between 2020 - 2022, where sales crashed in 2020 only to hit new highs when COVID eased in 2022. The headline 37% decrease in condo sales is less dramatic when you consider 2022 as an outlier year. As you will see in the data and commentary below, reduced demand, due to higher interest rates, is more than offset by historically low inventory levels (no one wants to sell and give up their 2% interest rates), resulting in stable pricing across much of the River North condo market.

River North sales are down 37% year-over-year, and trending back to the lows of the COVID years

River North Condo | Median Sales Price

River North condo pricing continues to recover from the brief COVID dip between 2020 - 2022. Where we go from here is difficult to predict. Will we see corporations again require employees to be in-office full-time? Or is the hybrid remote trend here to stay? I think the answer to this question will determine the direction of pricing on River North condos going forward - as it will for other areas that directly border the loop. With so many homeowners with historically low mortgage rates, we anticipate many will hold their condo units and decide to rent rather than sell. This will contribute to continued low inventory levels going forward, and will ultimately contribute to increases in valuations should demand once again return to more normalized levels.

River North valuations have recovered from the lows of 2020. Low inventory levels are offsetting decreased demand

River North Condo | Contract Activity & Month's Supply

Home contract activity, when combined with current inventory levels, is easily the most important data to analyze if you hope to fully understand the current state of the market. In addition, building-level analysis of this same data is essential in determining what price to list a property, or how high and aggressively to make an offer. April's headline number for River North shows a dramatic 33% decline in year-over-year contracts written for condos. While the number alone is eye-popping, it's less concerning when you consider inventory levels are also down 22% over the same period. Higher interest rates and lower inventory levels are the catalysts for reduced real estate transactions in River North, as well as across much of the country. The decrease in contracts written is not an indication of direction with valuation, but it does indicate that May closings will once again be well below historic norms.

Home contract activity is down 33% for the 3 months ended April 30, 2023

Month's Supply is up 7% from 2022 as higher mortgage rates have caused a reduction in demand

River North Condo | Inventory Levels

One of the best things we can say about the River North real estate market is that the inventory of homes for sale remains low relative to overall demand. Inventory levels are down 21.2% year-over-year and approaching lows not seen in over a decade. This is a positive for pricing and is the reason River North's valuations have recovered from the COVID lows of 2020. The graph below clearly shows that the inventory of River North condos is at the lower end of the historic range. As discussed above, we anticipate inventory levels to remain low for years to come.

Are you in the market to buy, sell, or rent a River North condo? Are you interested to see current data on a specific River North building? Contact us today and we will be happy to help make your next real estate transaction a complete success.