The number of condo units listed for rent at the end of each quarter has risen from roughly 300-600 in 2005-06 to 700+ units during 2007 and then escalated dramatically through 2008 to the current level of over 1,700 units. This is a 43 percent increase over the 4Q08 level.
The number of units leased increased from sub-700 levels before 2007 to 1,000+ units through summer 2008. A notable drop off occurred in 4Q08 that continued into 1Q09; however, the 2Q09 rentals set a record for the downtown market at 1,375 units which was eclipsed by the 1,507 units leased in 3Q09.
The 4Q09 level retreated to 900 units leased — following a pattern of decline in 4Q numbers due to the winter season.
Over the past 12 months, 4,483 units were leased downtown (the highest one year period since we began formally tracking the shadow market) via the MLS compared to the 3,449 units in the prior 12 month period.
We continue to see condo rentals as providing notable competition to the traditional rental market. Access to rental information is readily available on the Internet, creating a highly informed renter with regard to options in the market. Listings on Craigslist have increased notably over the past year for downtown units. Apartment owners and leasking brokers are also making extensive use of Craigslist for traditional rental buildings. Leasing agents are highlighting the inferior level of service in condo units compared to traditional rentals in addition to the risk of unit foreclosure; the trade offs however appear to be accepted by the market at this time.
Every Friday we record the number of condos listed for rent in 14 downtown ZIP in our Downtown Chicago Rentals spreadsheet. Check it every week to keep track of listing trends in neighborhoods like the Loop, South Loop, Streeterville, River North, and West Loop.