Understanding the Implications of Pandemic House Price Gains in Chicago’s Communities of Color
This blog updates data on house price trends in City of Chicago neighborhoods based on the neighborhood’s race and ethnic composition. These indicators were originally released as part of IHS’s 2021 report Data and Research to Facilitate Equitable Homeownership in Chicago, a collaborative report with the Urban Institute. That report highlighted key data meant to inform the development and implementation of local strategies to expand access to homeownership and wealth-building opportunities for Black and Hispanic households, protect current homeowners of color, and preserve the existing affordable housing stock in Chicago.
The analysis uses data from IHS’s Cook County House Price Index, now updated through the second quarter of 2022, as well as data from the American Community Survey on the race and ethnic composition of census tracts. The IHS House Price Index tracks quarterly changes in house prices, benchmarking these changes to price levels in 2000 through the second quarter of 2022.
The new data show that single-family house prices increased dramatically after 2020, particularly in predominately Black and majority Hispanic/Latino neighborhoods. Rising prices during the pandemic have helped prices to finally recover from the decades-old impact of the Great Recession in Black communities where house prices fell 60.3 percent from 2007 to 2012 and were still 24 percent below pre-recession peaks at the end of 2020. In majority Hispanic/Latino and majority non-white communities, house prices have also grown and have seen the largest longer-term price gains in the city. For many community development practitioners, price gains in Chicago's communities of color are a welcomed and positive story and a response to substantial efforts to rebuild demand and stabilize communities that had been disproportionately devastated by the foreclosure crisis. Conversely, rapid price gains also raise questions about the importance of maintaining affordability, mitigating displacement pressures, and working to ensure that price gains build wealth for the community.