When the coronavirus pandemic hit Illinois in March, long-time real estate broker Mary Summerville was scared.
“I thought I would have to file for unemployment,” Summerville told Evanston Now. “How do I get through this?” she worried.
That worry was justified. According to the North Shore-Barrington Association of Realtors, new listings of single family houses in the region dropped 60% in April versus the same month in 2019, as the economy basically shut down.
But home sales have come roaring back, and Evanston is one place where that roar is really loud.
“I can’t keep up with it,” Summerville said. Things are “selling like crazy.”
NSBAR CEO Jeff Lasky says that with mortgage rates “historically low””, (2.71% for a 30-year fixed mortgage), and with the housing inventory in Evanston so tight, “people snap up houses pretty quickly.”
According to NSBAR, the median price for a single family house in Evanston this year has jumped 15% over the 2019 level, to $587,250. That 15% price increase is higher than the increase in both the North Shore region (8%) and Cook County as a whole (10%).
But why did things go from so bad to so good so quickly? One reason is the low mortgage rate. But ironically, the pandemic may be another reason.
With so many people now working from home, Summerville said families who live in the City of Chicago started looking for more room. “The exodus from the city is hitting us” in Evanston, Summerville said. Remote school is also adding to the push for larger places to live, as children need additional space as well.
Of course, some families looking for space move to “bedroom communities” in suburbia, but for those wanting a more diverse location with urban amenities, “Evanston is the alternative,” Summerville said.
Even before the pandemic, real estate brokers were showing some homes virtually. So when that became almost mandatory due to the virus, brokers were ready. “We were doing virtual for quite awhile,” Lasky said. “Residential real estate adapted very quickly” to the new reality. Real estate was also declared an “essential business” by the governor, so sales did not have to stop.
As for potential buyers who wanted to see the property in person, Summerville said she left “COVID bags” at the house, boots, gloves and sanitizer.
There is a downside, however, to the market upside. Affordable housing, always hard to find in Evanston, is now squeezed even more.
Reba Place Development Corporation is a faith-based, non-profit organization that develops and manages affordable housing for low-income individuals. Keith Banks, of Reba Place, said there is a “huge shortage” of affordable housing in Evanston, and the pandemic is “making it tougher” to provide it.
“The demand is there, but the supply is not,” he said. For example, Reba Place was trying to buy a piece of land in order to build affordable housing. But, he said, a for-profit developer came in and “gobbled the property up” for luxury condominiums before Reba Place could arrange financing. Reba Place is now trying to raise funds to purchase a different piece of property. They have more than 70 people on their affordable housing waiting
“Affordable housing” has a different price tag in different communities. The federal government defines it as costing no more than 30% of a person’s annual income. But Connections for the Homeless, an agency in Evanston, believes the federal formula does not realistically take into account additional living expenses beyond housing.
Under the Connections computation, “affordable housing” in an expensive place like Evanston is for a family of four with an income of up to $91,000 a year. While $91,000 is a lot of money in many places, Sue Loellbach, of Connections, says a family of four in Evanston is “probably going to have a hard time” finding housing they can afford.
Loellbach says many low and moderate income families probably don’t even look in Evanston and the North Shore, and some already here, particularly Black families, “are leaving Evanston because of the high costs.”
But overall, even as the weather starts to get cold, the Evanston housing market remains hot, and Mary Summerville said it’s “not just in high end houses.”
Summerville said she had a couple of open houses recently, and “it looked like people waiting to get into Trader Joes. Couples were lined up down the block.”