The very things holding the suburb back—big traditional homes far from the city—are now attractive during the pandemic.
By: Dennis Rodkin
In the fall of 2017, the real estate market in Lake Forest had been so slow for so long that officials launched an ad campaign that used such slogans as “Safety has found a home here.”
At the time, that line was meant to appeal to families who were worried about rising gun violence and other crime in Chicago, but three years later, there’s “a different kind of safety people are looking for,” says Deborah Fischer, a Berkshire Hathaway HomeServices Chicago agent who was part of the group that organized the “Welcome Home” campaign.
A safe place to live is now “a big house on big property where you can safely social distance,” Fischer says. “We have those.”
Widespread lifestyle changes prompted by the pandemic—working, schooling and getting recreation all at home—have lifted many real estate markets this year as people trade up to larger spaces, commuting worries behind them since working full time in an office again is an open question. Few markets in the Chicago area have felt the shift as sharply as Lake Forest, which turned almost overnight from a moribund housing market into one of the suburbs’ most dynamic.
More homes sold in the six months just ended than in each of the four 12-month periods before that. Midwest Real Estate data reports 367 homes sold in the six-month period ended Oct. 25. Yearly average sales volume has averaged 320.
Lake Forest was among the suburbs where Crain’s reported sales in August were double what they’d been a year before, and in September sales were up 130 percent: 60 homes sold, compared to 26 in September 2019.
A year ago, the inventory of homes on the market in Lake Forest could fuel 14 months of sales. Now there’s roughly three months’ inventory.
“It’s been crazy,” says Corky Peterson, another Berkshire agent in Lake Forest. “The number of people looking up here from the city has skyrocketed.”
“They’re coming from Chicago but from other suburbs, too,” says Andra O’Neill, an @properties agent. The draw is the same wherever they come from, she says: “bigger space, bigger property, good prices and lower taxes.” The predominant property tax rate in Lake Forest is 5.3 percent, the lowest of any municipality in Lake or Cook County.
Sales records don’t show where buyers come from. But Peterson and three other agents all say much, but not all, of the increased buying is by families moving from the city.
Peterson represented buyers from Lincoln Park who paid $4 million for a 19th-century colonial revival on Westminster Avenue in mid-October. He declines to name them, and county records don’t yet identify them, but Peterson says the 10,800-square-foot home suits their need for home offices and school space. The 2.6-acre property includes an outdoor pool, and it’s a few blocks west of the town beach and a few blocks east of the Metra station and Lake Forest’s gracious century-old Market Square downtown center.
The setting is reassuringly like Lincoln Park, with the lakefront, shopping, dining and CTA all close at hand.
While Lake Forest’s mansions used to feel too old, too big and priced too high, a lot has changed in the interim.
Too old? Not a problem. “When you’re working from home, you don’t want that open plan,” Fischer says. “You want libraries, double libraries for him and her.”
Too big? Space is the primary luxury in a year of shutdowns.
Priced too high? Asking prices have dropped after years of slow sales. Typical is the 10,000-square-footer on Circle Lane that came on the market in October 2015 at nearly $6.75 million and lingered for years, with occasional price cuts. In March 2020, the price came down again, to just under $3.7 million, and in August it landed a buyer. The sale closed in late October at the last asking price.
The median price of a home sold in Lake Forest in the first nine months of 2020 is about $740,000, up 0.7 percent or essentially flat with the same period last year, according to monthly statistics from the Chicago Association of Realtors and MRED.
Historically low interest rates, while not unique to Lake Forest, are also giving buyers more bang for their buck in house shopping.
With few people commuting now and the possibility that the five-days-in-office workday may be gone for good, “some say we are not as far from Chicago as previously thought,” says Mona Hellinga, a Berkshire Hathaway HomeServices Chicago agent.
Will the comeback in Lake Forest’s real estate market last? No one can say, but real estate agents are confident, in part because “people are finding the value we always knew was here,” Fischer says, and in part because more pandemics and shutdowns may lie ahead.
The $4 million buyers on Westminster, Peterson says, are keeping their Lincoln Park home for weekends. Down the line, they may move back there and make the Lake Forest house their weekender.
“People who lived in the city don’t want to give that up, but this year they want refuge,” says Kelly McInerney, an @properties agent. “I think some of the bigger Lake Forest homes that were bought this year will become second homes” when life returns to normal.
In that, she says, “it would be back to the old days,” when Lake Forest was a hub of country estates and gentlemen’s farms for the wealthy elite of Chicago.