CHICAGO | Politics and Current Events

[ardecila]

Originally Posted by the urban politician

Was reading an article about Daniel La Spata today and his ideas to make Logan Square more affordable.

It consists of.....allowing more housing....but wait, not too much housing.....and you have to make the housing big and affordable.....but wait, we can't have too much. And you need "inclusionary" development too, and single family homes, but not too expensive.....and access to transit, but that access should be for "everybody"......and....but the buildings are too tall even though I like them and....

While we're at it lets just follow the yellow brick road and meet the wizard and clap our heels together and hope to be back in Kansas!

That's what happens when you get populists voting in some 37 year old "community event planner" dude who's never had to run the numbers with a lender and justify an acquisition loan, and who's never had to put together a balance sheet for a business in his entire life, and probably never will. A bunch of gobbledy goo, and I'm 100% certain that his haphazard incompetence will do absolutely nothing to stop the rising cost of living throughout his ward.

Yes, La Spata has gotten the privilege of being able to complain constantly during his years at LSNA. But now he actually has to govern, which is a whole different thing. Moreno was a corrupt prick, but he understood how to work with developers and he got more affordable housing built in his ward than any other alderman in the city.

Rosa already went through the same rude awakening... and has basically zero new affordable units to show for his first term, while he is powerless to stop the displacement that results from deconversion - now running rampant in Logan Square.

I wouldn't get too disappointed by LaSpata's development plan, though - even experienced politicians will carefully word their statements so that there's something for everybody. It's probably a good sign even that his public statements aren't 100% socialist Che Guevara, it gives me hope that he might be more pragmatic and eventually evolve into a more traditional alderman.

[Vlajos]

Originally Posted by ardecila

Yes, La Spata has gotten the privilege of being able to complain constantly during his years at LSNA. But now he actually has to govern, which is a whole different thing.

Rosa already went through the same rude awakening... and has basically zero new affordable units to show for his first term, while he is powerless to stop the displacement process from deconversion.

Unfortunately, wards 33, 40 and 47 may soon have similar Aldermen. Rogers Park ousted Moore for this craziness, no runoff there.

[LouisVanDerWright]

Wouldn't be an election in Chicago without some good ole fashioned vote buying!

https://www.wbez.org/shows/wbez-news...7-316a6c8f832d


I have decided to whole heartedly welcome the imbecelic wholesale destruction of affordable housing on the NW side and elsewhere proposed by our lovely batch of mini Che's. I'm tired of resisting their horrible policy proposals when they will actually benefit me. Turn my entire block into $750k mini mansions IDGAF anymore. Just had our first 3/4 million sale and guess what, it was yet another smart home on a vacant lot that otherwise would have been a 3 or 4 flat if it weren't for downzoning.

Go right ahead, zone the entire city RS-1, make my day. Soon my shitty frame two flat will be worth $1.5 million like it would in Denver, SF, or LA...

[the urban politician]

Didn’t Willie Wilson do the same thing (vote buying)?

[Steely Dan]

Originally Posted by LouisVanDerWright

I have decided to whole heartedly welcome the imbecelic wholesale destruction of affordable housing on the NW side and elsewhere proposed by our lovely batch of mini Che's. I'm tired of resisting their horrible policy proposals when they will actually benefit me. Turn my entire block into $750k mini mansions IDGAF anymore. Just had our first 3/4 million sale and guess what, it was yet another smart home on a vacant lot that otherwise would have been a 3 or 4 flat if it weren't for downzoning.

Go right ahead, zone the entire city RS-1, make my day. Soon my shitty frame two flat will be worth $1.5 million like it would in Denver, SF, or LA...

and this is what i meant when i talked about the pendulum swinging back and forth. eventually, when median home prices in their wards surge 200+%, these alderman will figure it out.

but most people are thick-headed (on all sides of the political spectrum), so there will have to be some temporary short-term pain to make them realize that you don't make housing more affordable by restricting supply.

[Vlajos]

Originally Posted by Steely Dan

and this is what i meant when i talked about the pendulum swinging back and forth. eventually, when median home prices in their wards surge 200+%, these alderman will figure it out.

but most people are thick-headed (on all sides of the political spectrum), so there will have to be some temporary short-term pain to make them realize that you don't make housing more affordable by restricting supply.

But once the City creates the new rent protected class it will be very hard to correct the problem. It is very hard to take those protections away. Of course then Chicago will experience underinvestment in multi family and more deconversion making the problem worse.

[the urban politician]

Originally Posted by Steely Dan

and this is what i meant when i talked about the pendulum swinging back and forth. eventually, when median home prices in their wards surge 200+%, these alderman will figure it out.

but most people are thick-headed (on all sides of the political spectrum), so there will have to be some temporary short-term pain to make them realize that you don't make housing more affordable by restricting supply.

A cup half full perspective, I guess.

The pendulum has swung to the left for a good half a century (strict zoning, strict building code, constrained supply, anti-landlord policies) and has yet to swing back.

[Steely Dan]

Originally Posted by Vlajos

But once the City creates the new rent protected class it will be very hard to correct the problem. It is very hard to take those protections away. Of then Chicago will experience underinvestment in multi family and more deconversion making the problem worse.

perhaps rent control will happen. i hope it doesn't, but it's possible.

i'm glad i don't have an investment portfolio heavy on chicago rental properties.

if i did, i might be thinking about divesting myself of some those right about now.

[moorhosj]

Originally Posted by the urban politician

The pendulum has swung to the left for a good half a century (strict zoning, strict building code, constrained supply, anti-landlord policies) and has yet to swing back.

People on this blog are consistently arguing that there is no affordability crisis in the city. Chicago is often used an example of a large, dense city with affordable real estate.

If supply is constrained, landlords are targeted, zoning is strict and the building code makes development too expensive; why are prices so low compared to other cities?

[the urban politician]

Originally Posted by moorhosj

People on this blog are consistently arguing that there is no affordability crisis in the city. Chicago is often used an example of a large, dense city with affordable real estate.

If supply is constrained, landlords are targeted, zoning is strict and the building code makes development too expensive; why are prices so low compared to other cities?

Chicago has the worst of both worlds, in some ways:

It has the political environment of a high cost coastal city without the high cost of real estate and rents to sort of "make up" for it all.

So the margins are often very thin. You can spend $200,000 fixing up a property but, in many areas, that may not actually get you much rent.

We experienced what I would consider an anamalous golden period from about 2009-2015 where SO MUCH cheap inventory hit the market in Chicago after the 2008 crisis that there was enough to go around for everybody. It was easily justified to snap up a cheap north side property, spend tons of money rehabbing it, and given how many renters have flooded the market--raise rents enough to justify.

Fast forward to today, and the market has equilibrated (nearly) and tightened back up. This is definitely a good thing. Neighborhoods everywhere (north and south and west) have probably seen billions of dollars of investment in fixed up properties. But that tap is surely going to slow as the ROI is getting thinner and thinner.

[moorhosj]

Originally Posted by the urban politician

Fast forward to today, and the market has equilibrated (nearly) and tightened back up. This is definitely a good thing. Neighborhoods everywhere (north and south and west) have probably seen billions of dollars of investment in fixed up properties. But that tap is surely going to slow as the ROI is getting thinner and thinner.

Market tightening on the northside is exactly what this city needs. It should naturally force people to re-locate to other, under-invested neighborhoods. Anecdotally, I know a few young families who have moved to Portage Park and Jefferson Park, neighborhoods long known for housing city workers. I imagine that drives demand in places like Clearing, Garfield Ridge and Ashburn.

As long as educated, young professionals continue moving into the city, gentrification won't stop, it will simply move to different neighborhoods. Instead of Logan, Humboldt, Uptown and Pilsen we will talk about Hermosa, Little Village, McKinley Park, Bronzeville and Pullman.

[the urban politician]

Originally Posted by moorhosj

Market tightening on the northside is exactly what this city needs. It should naturally force people to re-locate to other, under-invested neighborhoods.

^ But what happens is that rent control would curb this.

A person living in a rent-controlled apartment in, say Logan Square, will stay put as their building slowly becomes more worn out, instead of moving west to, say Hermosa.

So the lower cost areas outside of the zone of gentrification will not get a flood of new residents "displaced" from gentrifying areas. These low cost areas suffer, in a way, because newer residents often pay slightly higher rents and thus justify further investment.

This is characterized as "evil" by the Rosas and Guzzardis of the world just to win votes, but actually Chicago kind of needs this process--badly--to stabilize parts of Chicago that are in bad shape.

[moorhosj]

Originally Posted by the urban politician

But what happens is that rent control would curb this.

Your point is valid, it's just based on the assumption that rent-control is enacted. I don't see that as very likely right now. It requires legislation at both the state and city level, which is always a tough road. On top of that, the current favorite, Lightfoot, doesn't support it.

EDIT:
Right on time, an article from Crain's showing the top 5 ZIP codes for house flipping are all on the South Side.

The Chicago-area ZIP codes with the most flips in 2018, according to Attom, were:

• 60628 in Roseland (where the 104th Place house is located), 107 flips
• 60629 in West Lawn, 87
• 60440 in Bolingbrook, 77
• 60652 in Ashburn, 74
• 60620 in Auburn Gresham, 73
• 60619 in Chatham, 73

[the urban politician]

In another speak of the devil sorta thing:

A Tribune editorial against rent control and what it would do to Chicago:

https://www.chicagotribune.com/news/...305-story.html

[Kenmore]

chicago absolutely has an affordability crisis, don't let anyone raising their kids in suburbs convince you otherwise

[Steely Dan]

Originally Posted by Kenmore

chicago absolutely has an affordability crisis,

it absolutely does not, not holistically anyway.

it may have an affordability issue in neighborhoods that don't have weekly shootings in the streets.

and FTR, i'm not raising my kids in the burbs.

[Vlajos]

Originally Posted by Steely Dan

it absolutely does not, not holistically anyway.

it may have an affordability issue in neighborhoods that don't have weekly shootings in the streets.

and FTR, i'm not raising my kids in the burbs.

Three kids being raised in the City here as well. Chicago is inexpensive for a large US City. You can find dirt cheap apartments and houses very easily. Of course, as you point out, they may not be in Lincoln Park or North Center in large quantities, but there are plenty of options.

[Vlajos]

According to the Census Bureau's most recent five-year estimate, median gross rent across the city (which includes utility and fuel costs) was around $1029. That requires a whopping $49,392 income assuming a 25% income to house expense.

In January 2019, the median sales price of homes sold in Chicago was $252,000. Assuming 10% down and a 5% interest rate, that's a monthly payment of 1217.51 plus PMI and homeowners insurance. Of course, that's before Toni Prekwinkle's County and Jesse Sharkey's CTU get their take.

[moorhosj]

Originally Posted by Kenmore

chicago absolutely has an affordability crisis, don't let anyone raising their kids in suburbs convince you otherwise

This is pretty easily proven wrong. I'll just show a couple neighborhoods on the northside.

Portage Park:

• 4 bed, 2 bath bungalow for $295k with good schools
• 4 bed, 3 bath ugly home for $298k with the same good schools

Norwood Park:

• 3 bed, 2 bath Georgian home for $295k with great schools
• 3 bed, 2 bath Queen Anne home for $199k with really good schools

[twister244]

Originally Posted by moorhosj

This is pretty easily proven wrong. I'll just show a couple neighborhoods on the northside.

Portage Park:

• 4 bed, 2 bath bungalow for $295k with good schools
• 4 bed, 3 bath ugly home for $298k with the same good schools

Norwood Park:

• 3 bed, 2 bath Georgian home for $295k with great schools
• 3 bed, 2 bath Queen Anne home for $199k with really good schools

I about shit a brick when I saw these. Those same houses would easily be north of $400k here in Denver, likely over $500k. It really perplexes me when I see folks in Chicago talking about an "affordability" crisis. People tend to think the grass is always greener on the other side, when in reality, you guys are getting a damn good bargain for what you pay for. A beautiful lake front (when it's not winter), amazing food, a top-notch US urban experience, and amazing architecture. Yes, taxes are still very high, but even after accounting for that, it's still a good deal. Come to Denver where our average rent is over $1500 a month......