Downtown Chicago Apartment Deals May Be Harder to Find in 2021

The on-going pandemic has been tough on a variety of industries, but downtown landlords are feeling optimistic in 2021. For renters, that could likely mean downtown deals will be harder and harder to find.

Rents and occupancies in downtown took a nosedive last year, thanks in part to so many people working remotely from home. With bars and restaurants closed too, it led to some giving up their pricey downtown rentals.

After making it through a tough year, demand for downtown apartments has started to turn around again. Demand rebounded in late 2020, helping to begin stabilizing the market.

Some of the credit to the turnaround is likely tied to the great deals that were offered by landlords. Many buildings were offering deals too good to pass up, including two to three months of free rent just for signing a one-year lease. Some landlords went as far as offering up four months of free rent, along with other perks.

Some estimates put the downtown occupancy rate at about 86-percent in the fourth quarter of 2020. A year earlier, the rate was more than 93-percent. That was before the pandemic took a toll on the economy.

Experts are predicting the number will likely climb above 90-percent again by mid-summer. Downtown rents have stabilized some, although they are still down from the fourth quarter of 2019.

As demand for downtown apartments rises, we’re also seeing a slowing in supply growth. That will likely give landlords more control over pricing. Development has already slowed as investors pulled away from new project financing.

It’s likely the downtown apartment rental market will be heavily tied to how fast employers bring their remote workers back to the office. Even with more and more people being vaccinated, some aren’t predicting a full recovery in downtown rents for a couple of years.