Will the luxury market beat last year’s? It’s coming down to the wire

Despite strong showing, time runs out for 2022 to match last year's banner pace

Tribune Tower (Illustration by The Real Deal with Getty, Google Maps)
Tribune Tower (Illustration by The Real Deal with Getty, Google Maps)

Chicagoland’s banner year for luxury real estate is proving hard to replicate.

The city’s residential transactions over $4 million are slowing as the year closes out, meaning it may be a challenge to match the previous year’s frenetic pace of deals.

Transactions have started to slow for properties over $4 million, which is the benchmark used by the Chicago Realtors’ Association as well as The Real Deal to mark the high end of the city’s luxury market. A slow winter market is common, but means it’s unlikely this year will have enough deals to close the gap with 2021.

The most recent transaction in that price range is a $4.5 million sale at Tribune Tower that closed Dec. 9 and was published on the MLS Tuesday. The public listing doesn’t have any information on when the three-bedroom, four-bathroom condo went under contract, but the deal has likely been in the works for months, like many others within the redevelopment of Tribune Tower.

Prior to that sale, none had been posted in the same range since Dec. 1.

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Within city limits, 66 sales closed at $4 million or more last year, according to the Chicago Association of Realtors. So far this year through Tuesday, 57 such sales have taken place in 2022, putting 2022 slightly behind last year’s pace, according to publicly disclosed sales. That doesn’t include any of many luxury sales outside of city limits and any off-market deals that haven’t been recorded in Cook County property records.

Despite rising interest rates, this year far exceeds pre-pandemic luxury sale levels. In 2020 only 26 sales were in the same category, and in 2019, which offers the last full year of data before the health crisis, only 38 sales were at or above the $4 million rung.

While high-end residential properties posted a strong overall performance in deal volume, their prices, especially in the city’s condo market, lagged throughout 2022. Plenty of the city’s richest home sales included steep cuts from their listing prices, meaning many sellers had to shave millions off their initial asks to get a deal done.

This year’s priciest deals, including the $20 million Trump Tower Chicago penthouse sale that was cut from a $30 million list price, have undergone substantial shaves. In the Gold Coast, a 10,000-square-foot Beaux-Arts style mansion sold for $7 million, almost half the $13.5 million asking price when it was listed two years ago.

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