As millennials become one of the largest drivers of the housing market, agents and landlords are beginning to take note.
Today, millennials make up roughly 40 percent of the housing market, and more than 90 percent are renters. They’re also moving in droves to rent in Chicago, where rental apartments make up 30 percent of all housing. In fact, the city is home to seven of the country’s most populated ZIP codes for millennials.
But as the number of renters in Chicago continues to increase, where are millennial renters looking and finding deals to rent in a Chicago market that seems intent on pricing them out?
To find out, the team at RadPad took a deep-dive into listings that millennial renters on the RadPad rental marketplace were looking at in August of this year compared with in October of 2014. After all, 80 percent of RadPad users are millennials.
In total, data from 18,000+ listings was used to analyze how rental supply and demand has changed in the past year in Chicago, and how that is impacting housing costs.
Luckily, millennial renters living by the “L” in Chicago weren’t subjected to the kind of rental price explosions that cities like San Francisco, New York City, Los Angeles and Miami have seen over the last 10 months. For these renters who are saving money by shacking up near public transportation it’s a double-win!
While not everyone near the “L” was lucky enough to see prices drop, only 38 percent of median rent prices near the “L” line increased over the 10-month time period we looked at.
Old Town is cool for new renters
Much-coveted Old Town came in with the highest price spike since October, with a $306 increase in median rent price. Historically, this is one of the city’s most desirable neighborhoods and millennial renters are feeling the shortage in supply as well.
Hey, it’s home to one of the most unique streets in the United States — so maybe we shouldn’t count on demand reversing course there anytime soon.
Crime in Chatham drives down demand and rental prices
On the flip side of things, Chatham took one of the deepest dives in rental prices as crime continues to be a black eye on the neighborhood. From October of last year to August of this year, the median monthly rent for one-bedroom apartments in the area dropped by more than $250.
While overall crime has dipped slightly over the years, Chatham still ranks 14th out of 77 Chicago neighborhoods for violent crimes. This area is a safer bet to save money, but the drop in rent prices is clearly not a positive indicator.
Supply is up on the green line and millennials are moving in
After just 10 months, average median rent prices near the Douglas, Kenwood, Washington Park and Englewood stops on the Green Line all went down at least $150 since 2014. While prices remain at $1,563 per month, $1442 per month, $1,322 per month, and $984 per month respectively, the extensive decrease makes living in 2015-2016 look more and more promising.
South Siders can save some money on rent
While Cubs fans looking at one-bedrooms in Wrigleyville need to be prepared to spend $195 more now versus last October, White Sox fans are finding apartment deals sprinkled in with another losing season.
Prices for a one-bedroom near the red line’s White Sox stop stayed at $1,388. A winning season next year will no doubt raise the mood for Sox diehards, but it might also raise prices for those near U.S. Cellular Field. Be careful what you wish for.
Marketing to millennial renters in Chicago
So as millennial renters continue to look toward Old Town, along with deals on the green line, what types of rental properties should agents be marketing to them?
Previous data we’ve pulled on millennial renters’ interests found that patios and balconies are a top demand for young renters in Chicago. In fact, patios and balconies came in at no. 3 on the list of amenities millennial renters in Chicago are searching for, despite not ranking in the top ten of amenity demands nationally.
Although Chicago residents are about to hunker down for another long winter, it seems agents and landlords can stand out in the crowd by marketing rental properties that millennial renters can see themselves warming up in once the spring finally rolls around.
Finally, don’t forget to promote parking and a garage — as at least not all millennials have traded in their cars for car-sharing and bikes just yet!
Jessica Naziri is the strategic communications and content lead at RadPad.
