Does anyone think we're entering another real estate bubble? (Chicago: credit, affordable houses)

[JTW2013]

Originally Posted by My Kind Of Town

The median household income for Elmhurst in 2012 was $91.5k. Adjusting for a 3% annual increase, it is safe to say the current median income is approx. $100k. This also includes the lesser neighborhoods within Elmhurst. I would guess that the nicer neighborhoods with great grade schools the median income is closer to $125k. If you are making the median income within this area (the "middle" relative to this suburb) and have enough saved for a 20% down payment you should be able to afford a home in the $450k - $500k range. OP said that their kids are approaching their teenage years so childcare costs shouldn't be a factor.

I don't think we're talking about the same thing. I think we all know that the people living in an upper middle class town like Elmhurst can afford to live in Elmhurst. What I was saying is that a middle class family in the Chicago area cannot afford to move to Elmhurst or Hinsdale, Wilmette or wherever.

What suburb can you afford if you earn between $50K and $70K a year?

WRT the expectations of middle income families expecting a good school district, I think there was a time when a middle income family would expect a good school district. I would guess that 30 years ago there were middle income families in Elmhurst and Hinsdale (not middle for Elmhurst but middle for the region).

What seems to be happening in the Chicago area is that the better suburbs are getting more and more expensive and the schools in the middle and lower suburbs are getting worse. That is very troubling.

[mr roboto]

Originally Posted by JTW2013

I don't think we're talking about the same thing. I think we all know that the people living in an upper middle class town like Elmhurst can afford to live in Elmhurst. What I was saying is that a middle class family in the Chicago area cannot afford to move to Elmhurst or Hinsdale, Wilmette or wherever.

What suburb can you afford if you earn between $50K and $70K a year?

WRT the expectations of middle income families expecting a good school district, I think there was a time when a middle income family would expect a good school district. I would guess that 30 years ago there were middle income families in Elmhurst and Hinsdale (not middle for Elmhurst but middle for the region).

What seems to be happening in the Chicago area is that the better suburbs are getting more and more expensive and the schools in the middle and lower suburbs are getting worse. That is very troubling.

This X 1,000. There are plenty of metros where HH income of 70,000 allows you to be in a very good district. Chicago area is increasingly harder for middle class.

[destination-unknown]

Originally Posted by mr roboto

This X 1,000. There are plenty of metros where HH income of 70,000 allows you to be in a very good district. Chicago area is increasingly harder for middle class.

Which metros specifically? Coming from the east coast a few years back and having friends currently living on the west coast I can tell you it's certainly not more affordable on either of those coasts.

[JTW2013]

Originally Posted by destination-unknown

You missed the point. Hope and expect are two different things. I get the impression that many in the middle class expect to be able to afford a nice, good sized home in an excellent district. There are ways for middle class folks to afford excellent school districts but it will take some type of sacrifice. Be it renting vs buying or buying a smaller, dated home. You can't expect to afford an updated 2000 SF home in an excellent district with a minimal down payment and modest income. That just doesn't align with the reality of the situation. Something's gotta give.

I'll return to this because I think it's interesting.

Why shouldn't a middle class family expect a decent home with good schools? Hasn't access to decent housing and good schools for the children defined a middle class lifestyle in this country for generations? If a middle class income no longer affords those things then how it is middle class anymore (except in the sense that it's in the middle of the income range)? If a middle class Chicago family cannot afford a decent house and access to a good school district then they're taken a big step backward and are essentially equal to a working class family of the past.

[My Kind Of Town]

Originally Posted by JTW2013

I don't think we're talking about the same thing. I think we all know that the people living in an upper middle class town like Elmhurst can afford to live in Elmhurst. What I was saying is that a middle class family in the Chicago area cannot afford to move to Elmhurst or Hinsdale, Wilmette or wherever.

What suburb can you afford if you earn between $50K and $70K a year?

WRT the expectations of middle income families expecting a good school district, I think there was a time when a middle income family would expect a good school district. I would guess that 30 years ago there were middle income families in Elmhurst and Hinsdale (not middle for Elmhurst but middle for the region).

What seems to be happening in the Chicago area is that the better suburbs are getting more and more expensive and the schools in the middle and lower suburbs are getting worse. That is very troubling.

I referenced Elmhurst because the original poster expressed their frustrations with affording a larger home in Elmhurst. As I mentioned in my post from yesterday, a middle income family CAN afford a home in a good school district.

[My Kind Of Town]

Originally Posted by JTW2013

I'll return to this because I think it's interesting.

Why shouldn't a middle class family expect a decent home with good schools? Hasn't access to decent housing and good schools for the children defined a middle class lifestyle in this country for generations? If a middle class income no longer affords those things then how it is middle class anymore (except in the sense that it's in the middle of the income range)? If a middle class Chicago family cannot afford a decent house and access to a good school district then they're taken a big step backward and are essentially equal to a working class family of the past.

I think there is a difference between "good" and "excellent" school districts. No one is saying a middle income family shouldn't expect to afford a home in a good school district (ie. darien, lemont, palos, etc) but to expect to afford a home in an excellent school district (ie. hinsdale, wilmette, western springs, etc) while having a relatively updated 2000sf plus home is a different matter altogether.

[JTW2013]

Originally Posted by My Kind Of Town

I referenced Elmhurst because the original poster expressed their frustrations with affording a larger home in Elmhurst. As I mentioned in my post from yesterday, a middle income family CAN afford a home in a good school district.

So they can afford the worst house in Elmhurst that requires lots of expensive repairs/upgrades that they probably won't be able to afford?

I think that's missing the point. A generation or so ago, a middle income family could afford a decent house in a good school district. No need to settle for the worst house in the neighborhood.

[JTW2013]

Originally Posted by My Kind Of Town

I think there is a difference between "good" and "excellent" school districts. No one is saying a middle income family shouldn't expect to afford a home in a good school district (ie. darien, lemont, palos, etc) but to expect to afford a home in an excellent school district (ie. hinsdale, wilmette, western springs, etc) while having a relatively updated 2000sf plus home is a different matter altogether.

That difference is part of the issue. A generation or so ago, there probably wasn't such a difference between "good" and "excellent" and a middle class district could afford to provide an equal education to an affluent district.

But again that's missing the point. 30 years ago, a middle class family could afford to buy into one of these "excellent" school districts. Now they can't. That is different and it should worry everyone.

Besides, these "excellent" school districts are public. They are not private and therefore only accessible by people who can afford the tuition. All of these schools are receiving some support from the state and therefore the taxes of everyone who can't afford to buy into Hinsdale.

[Mathguy]

Originally Posted by RogerMarrino

Whatever the root causes, Chicago's traditional working-class suburbs have fallen on hard times over the last few decades. What the original poster said about the average family not being able to afford a reasonable home in a great school district is so true it hurts. Many of them can't even afford a modest fixer-upper in a reasonably decent school district. Even if they could, the property taxes would murder them. This has less to do with a real estate bubble and more to do with the fact that the Chicagoland area is continuing its decades-long trend toward two distinct types of suburbs: upscale suburbs that are out of reach of 90% of the population and blighted suburbs that have seen better days. There's very little, if any, middle ground in this region of the country.

Sucks to be part of the Chicago school system now doesn't it.

Oh wait, they actually use magnet schools to pull out the kids from many schools and thus even further deplete the academic talent and focus and the other schools that are "left behind".

Well, at least you can change that by voting out the ...... oh wait, no you can't you live in an oligarchy.

Oh well, at least you can call for outside influence about racist policies....oh wait, no you can't....the party won't allow that and will reprimand any national figures that make them " look bad ".

Tough luck I guess.

But hey! At least you don't have to worry about those republicans running the city! Huzzzzzah! Victory!

[jonnynonos]

The economy has basically been a big series of bubbles since the 90s. The top 1 percent get richer and richer, almost everyone else gets poorer.

Every time the bubble bursts the wealthy are able to swoop in, scoop up assets at a fire sale price, and wait out the next bubble.

So it is not surprising that there are jaw dropping centers of wealth like Hillside while other more modest suburbs flounder.