City home values only glimmer in bleak Cook property value report
Thursday, August 14, 2014
by Brian Slodysko
Chicago homeowners saw their property values inch up a bit in recent years.
But they didn’t have much company.
Property values across Cook County — residential, commercial and industrial — continued to slide, and are one indicator the area remains in the grips of a poor economy.
Those are the findings of a report released Thursday by the Civic Federation, which found real estate values dropped to a 10-year low in 2012, the most recent year for which data was available.
“It’s a really troubling trend in terms of loss of value. All of the gains that took place in the run-up to 2006 have been reversed,” said Civic Federation president Laurence Msall, who added that the report shows a reversal of long-term trends. Prior to 2006 there had been “a steady increase going back at least 10 to 15 years,” Msall said.
Experts had been optimistic that Cook County was on the rebound, after data for 2011 suggested property values had begun to stabilize. But in a one-year period values again plunged, dropping 6.4 percent across the county, according to the report.
Industrial properties sunk the lowest, losing 35 percent of their value since 2003. Commercial properties lost 23 percent of their value during the same period, according to the report. Residential properties fared better, losing only about 8 percent of their value during the period.
Chicago fared better overall when compared to Cook County suburbs. Home values in the city actually increased by about 5 percent. Meanwhile, industrial and commercial properties in the city faced a bloodbath, with industrial property values plunging 51 percent. Commercial values dropped about 29 percent during that period, the report shows.
Properties in the northwest suburbs lost about 17 percent of their value since 2003. The southwest suburbs fared similarly. The report does not break out data for the upscale north suburbs, or the county’s south suburbs, many of which are impoverished.
So what are the implications?
Government bodies that rely on property taxes are going to have to squeeze revenue from property values that are worth less, Msall said.
“It is very likely that there will be many property owners who will see the value of their property decline, but see their local tax demand increase,” Msall said. “It’s going to come at a greater cost because there’s a less to be spread around.”