Busy Deeter, her husband, Charlie Deeter, and their yellow lab Lily are moving from their one-bedroom loft-style apartment in the South Loop to a three-bedroom apartment in Ravenswood after a roller-coaster ride through the rental market.
For about three weeks in March, Busy Deeter, 29, said she and her husband, 33, had no luck in their search for a new apartment. As Zillow alerts came to their phones, they would schedule showings for the following weekend, only to find the place was gone before they could see it.
“That’s where I think the frustration started,” she said.
As the spring rental market kicks into high gear, some prospective renters are finding they have to act fast to secure affordable units, as experts say inventory is low and average rent prices in Chicago continue to creep up.
As of early May, the median time rentals remained on the market was about 10 days, said Mike Opyd, a real estate broker in Chicago with RE/MAX Premier, citing data from the Multiple Listing Service.
“Rentals tend to be going pretty quickly,” Opyd said. “There’s definitely options out there for people, but they’re not out there for that long.”
The Deeters’ apartment hunt was particularly long and stressful this time around compared with their last move in 2021, when they relocated from Nashville to Chicago, Busy Deeter said.
They found their roughly 1,000-square-foot loft-style unit in the South Loop “by chance” on Zillow during their last night of a weekend visit to Chicago in July 2021. The couple went to see the place the next day along with two other potential renters. They applied immediately after the showing and were approved.
They moved in about two months later. Their rent was just about $1,600 a month for the top floor of an eight-floor red brick building. They had a balcony as well as in-unit laundry and a two-vanity bathroom, all qualities Busy Deeter said added to the desirability.
After finding out her husband’s job was moving from the West Loop to north suburban Evanston, the couple decided to move north to lighten the commute, Busy Deeter said. It was also a good time to get a bigger place, she said, as the couple was married in October and hopes to grow their family soon.
They were also looking for overall walkability and proximity to the Metra, Busy Deeter said. The couple decided the maximum they’d want to spend on rent was $2,600 because they want to save money for future home buying and retirement. The search was narrowed down to a seven-by-seven block area.
At the start of April, the couple saw a listing on Zillow and reached out to get the earliest showing possible, she said. They went to see it, along with a few other couples, and “fell in love” with the place. After getting approved, the couple was waiting for a move-in date from the landlord to sign the lease. Their South Loop home was listed in the meantime, and it was gone within 24 hours. The next tenant’s move-in date was set for June 1, but the new place’s landlord came back and said the Deeter’s move-in date wouldn’t be until July 31.
“We couldn’t be homeless for two months,” Busy Deeter said. “We went back and forth thinking of ways we could make it work. We finally got a place, but then you’re running into another issue. We decided not to sign that lease and felt defeated because then it was mid-April and we’re having to start the process all over again.”
Some days later, another Zillow alert for a new listing showed up and the couple raced to get in for the first showing. They applied, along with several other people, and after narrowing down the applicants, the landlord asked to FaceTime with each of the final three. Busy Deeter said they talked about themselves, their pets and more about the building.
They’re moving into the three-bedroom, one-bathroom apartment this month. The building has three units total with storage and shared laundry in the basement. For the 1,500-square-foot apartment, the couple is paying $2,100.
“It’s a steal of a place,” Busy Deeter said.
While the current average rent in Chicago varies from source to source, several data sources tracking the housing market report an uptick in rent compared with a year ago. According to Apartment List’s May 2024 Rent Report, the overall median rent in Chicago is $1,683. This average is up 1.6% from April compared with the national month-over-month increase of 0.5%. The current overall median rent in Chicago is also up 1.9% from a year ago, while the average overall rent over the last 12 months across the country has declined slightly.
Chicago’s month-over-month rent growth ranks third among the 100 largest cities in the country, according to Apartment List.
But the rent growth so far this year is still pacing slower than the same time last year, Apartment List said. Rents have gone up by nearly 3% from January to April, while the rent growth during the same four-month time frame in 2023 was nearly 4%.
Kate Terhune, director of brand for Rent, said one issue putting pressure on Chicago’s market is the lag in inventory. Across the country, there are about 50% more available units to rent this year than last spring. In Chicago, that increase sits at just over 11%, not enough to keep up with demand.
“We need to see more units come to the market for rent prices to really fall,” Terhune said. “And then even the house price crisis that’s happening right now where house pricing is really high, APRs, mortgage rates are really high. That also puts pressure on rent prices. More people in the renting market means prices are going to stay high.”
Rent, whose parent company is Redfin, is a network of rental property listing sites that’s based in Atlanta but has listings and clients all around the U.S.
Fluctuation in the market is expected, Terhune said, but the last six months or so have seen “a lot more fluctuation” than normal because of changes in the housing market.
Eric Scholl, owner and president of the Apartment People, said Chicago didn’t get “much of an offseason” as is usually the case for the rental market in the winter. Starting around mid-2023, Scholl said he noticed a shift as people “stepped up their need for an apartment,” likely due to the hurdles to get into the housing market.
According to U.S. Bank, the current 30-year-fixed mortgage rate is about 6.8% in Illinois with roughly 7% APR.
“I don’t think this is the standard for the future,” Scholl said. “Things will level out, but it’s definitely a better time to be a landlord today than it was a year ago.”
Sheila Byrne is the executive vice president of property management for Chicago-based Habitat Co., which has about 16,000 units under management in the Chicago area. The rental need in Chicago remains great, Byrne said, and demand continues to exceed the supply.
Current occupancy levels at the Habitat Co.’s properties are sitting right around 95%.
New development is not only based on availability of physical space but also what kind of demographic would be interested in living in that area. When it comes to building a property out, it’s no longer just about the units themselves.
“Renters today are clearly searching for a lifestyle, not just an apartment, focusing on qualities like top restaurants, entertainment, great amenities all within reach,” she said.
The development of new units is also driven by factors such as high taxes, insurance rates and construction costs, which makes it “hard for developers to develop.”
“There’s going to be less coming out into the market in the next couple of years,” she said. “Real estate is very cyclical like that. You see peaks and valleys.”
Still, a pipeline of new units provides some relief. Doug Ressler, manager of business intelligence with real estate data provider Yardi Matrix, said there’s a “tremendous amount of new supply coming on board” in the city, with over 4,000 units adding to the market this year.
Last year saw about 3,500 new rental units in Chicago, Ressler said. “There’s never too many listings,” he said.
Some more choice in the market, at least this year, also means renters could see more concessions being offered, Ressler said. New properties looking to fill their units are more likely to offer reduced rates or certain freebies, like a month or so without paying for rent or parking.
Shepherd Gill, 25, moved into The Thompson, a new apartment building in the Fulton Market area that opened in December, in mid-April from a roughly 500-square-foot studio apartment in Oak Park.
Gill and his dog, Stevie, a husky-German shepherd mix, are now adjusting to life downtown in the nearly 700-square-foot, convertible-style unit, which he said is like a one-bedroom but without a bedroom door. The rent is around $2,400.
He gave himself a rent budget of around $2,300 and said the building offered a concession of two months off of rent for signing within a certain time frame.
For Gill, the hunt for a new place was smooth. He worked with a leasing agent, which “made all the difference,” he said.
“It took a lot of the stress off of searching for apartments because I found in the past it takes a lot out of you to find places and getting in contact with the people doing tours and trying to ask the right questions,” Gill said.
He knew he wanted a bit more space and a good amount of natural light, and he was primarily interested in the West Loop and Old Town neighborhoods. He also wanted to be close to a dog park, a mix of grocery stores and his office, where he’ll be a few days a week.
Gill said he toured about 10 apartments across a few different buildings. He saw The Thompson at the end of March and signed the lease soon after.
“It felt very easy,” he said. “When I toured the building and saw this unit, it did check a lot of my boxes. I wanted to send them the application immediately.”
Anecdotally, Gill said he recommends starting the search early as he thinks there is less turnover of apartments right now, especially because of high costs in the home buying market.
“The way the housing market is right now, people are kind of staying where they’re at,” he said. “I’ve heard from so many friends that are renewing their leases where they’ve been at for a while because they have a relationship with the landlord and the rent is somewhat stabilized.”
Scholl, who works with landlords across the city through Apartment People, a unit of Compass Realty, has noticed the same thing.
“I’m seeing a lot of lease extensions,” he said.
