Sue Fox, @Properties. Direct 773.816.1788
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Buyers often ask me for advice about a key question: Is it better to buy a smaller place in a nicer neighborhood, or a bigger home in a slightly less-desirable area? Real estate always involves a series of trade-offs (regarding price, location, size of the home, age of the home, amenities, school district, etc. etc. etc.) but this Location Vs. Size debate is one of the central decisions that buyers must make. In other words, is it a better investment to buy a 2-bedroom condo in, say, a stable, affluent area like Lincoln Park… or maybe a 3-bedroom condo a little further north, perhaps in Uptown or Edgewater?
These days, my vote would have to go with Location. That’s because we are now in Year 5 of a brutal and unrelenting real estate downturn, and I’ve watched homes in many fine North Side neighborhoods lose their value as buyers increasingly turned away from up-and-coming, less central areas in favor of those that were already quite popular. A bird in the hand is probably worth at least five in the bush in these uncertain times, and if you buy in an established, thriving community like Lincoln Park, you will likely come out ahead no matter what.
Consider the prices of condos and townhomes in Lincoln Park over the past two years. While other Chicago communities (and the city as a whole) saw home prices drop, the median sale price for Lincoln Park condos and townhomes increased 14.2% since June 2009, according to MLS data. And the climb has been relatively steady. Two years ago, the median sale price was $530,000. A year later, it was $557,500. And this June, it had jumped to $605,000.
Chicago home buyers are voting with their feet. Every day, they are choosing where to invest, live, and raise families — and they aren’t in a mood to gamble on a neighborhood that seems to be struggling or battered by foreclosures or lacking a strong commercial center or too far from the action. Lately I’m seeing more buyers opting for places like Lincoln Park, Lakeview, Bucktown, and the Gold Coast over areas like Logan Square, Irving Park, Albany Park, Uptown, Edgewater and Rogers Park — even if it means less space.
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