As we wait (and wait) for the Chicago housing sector to experience a rebound, it’s worthwhile to look at the larger Illinois economy for some clues. And the economic growth data released by the U.S. government this month shows that the Illinois economy contracted more sharply than the U.S. average in the recession and has grown more slowly in the recovery.
Further, it has grown more slowly, or contracted more sharply, than the U.S. average for each of the last 12 years. Last year, it trailed every other Midwestern state except Missouri. (Indiana led the region in growth from 2009 to 2010; see more at my Lakeshore Analytics blog.
A report from the American Legislative Exchange Council (pdf link) ranked Illinois 47th of 50 states in prospects for growth in the future. While the criteria looking forward are subjective, there’s no doubting a backward-looking measure, which ranks states based on a combination of population growth, income growth, and employment. On that measure, Illinois ranked 48th of 50 states.
There will always be pockets of prosperity in real estate, but widespread growth in housing requires people working, getting raises, and choosing to move to our area. On economic measures important to housing, our state ranks well below its potential
Jeff Baird is a real estate valuation consultant based in Chicago. He founded Lakeshore Analytics to bring comprehensive, understandable housing data and analysis to Chicago-area readers. The site features a blog with free market news and charts, summary data on 20 top neighborhoods, and quarterly data subscriptions.