What's In Store for the Chicago Mortgage Market in 2024?

Posted By Megan Horn on Nov 15, 2023

iEmergent Blog - Chicago Market Analysis

For this month’s market analysis, we’re headed to the Midwest—Chicago to be specific. Cook County, Illinois—where Chicago is, to be even more specific. We’re going to be looking at mortgage opportunity forecasts (a.k.a., what’s expected to happen in the market) and how data informs lending strategies. 

The data and maps in this email all come from iEmergent’s proprietary forecasts, datasets, and analysis tools, which are available in Mortgage MarketSmart. Lenders partner with iEmergent to grow volume, find mortgage opportunity in their communities, target diverse lending initiatives, and so much more.
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A Look Ahead at Cook County Lending

While looking at national mortgage forecast numbers is interesting and relevant, there is no uniform U.S. mortgage market. There are 84,414 census tracts (CTs) and 387 Metropolitan Statistical Areas (MSAs) that make up the U.S.—and each one is unique. We forecast mortgage opportunity at the census tract level where lenders can use that data to make localized decisions.

Since 2010, iEmergent’s forecast has outperformed most predictive analytics from other industries, maintaining an accuracy rate of over 90%, and is backed by a money-back accuracy guarantee*. You can read more about the forecast here.

Having said that, let’s look at Cook County to see what 2024 is expected to bring. Here are our forecast numbers for the county as a whole:

iEmergent Chicago 2024 Forecast

And here’s our census tract-level forecast data for 2024 purchase dollars in Cook County visualized:
Chicago - All purchase dollars

In many markets, the heat maps for total loans and total dollars look very similar. However, Chicago is one market where the maps look significantly different. Sure, the highest volume areas (oranges and reds) line up for loans and dollars, but the census tracts in the middle (yellows and greens) have a lot of loan opportunity even though they don’t light up in the dollars category.

Chicago - All purchase loans

Look at the southern 1/4 of the county—you can see many census tracts that stand out as opportunity zones when we look at loans even though they don’t when we look at dollars. 

This is yet another example of why it’s important to understand what data you’re looking at—and to have access to data for your markets.

Shrinking Opportunity

Unfortunately for lenders in Chicago, Cook County isn’t expected to grow a lot over the next five years. It’s forecasted to grow only slightly (less than 3%) from 2023 to 2024, and then to contract through 2028. 

This is demonstrated in iEmergent’s Mortgage Velocity Index (MVI), which shows change in a market over the next five years. The Chicago-Naperville-Elgin, IL-IN-WI CBSA* is forecasted to shrink slightly compared to the overall U.S. market for the 5-year period starting in 2024. 

*Note the change in geography from county to CBSA. This is to better compare similar geographies in the next chart. Learn more about levels of geography in Mortgage MarketSmart.

To give you context, an MVI of 1 means a market is growing on pace with national market growth. So with an MVI of -.46, the Chicago CBSA is shrinking at about half of the pace the U.S. market is growing.

We can see Chicago’s MVI compared to other major markets in the U.S.:

iEmergent Chicago 2024 MVI

Whereas many other major metro areas are growing, the Chicago CBSA is shrinking (Cook County is, too, but we don’t want to compare Cook County to, for example, the whole LA CBSA). This means lenders in Chicago need to be even more strategic—and data-driven.

Setting Appropriate Goals

With a contracting market, lenders in Chicago need to plan their goals and strategies. 

For example, a lender in Chicago could choose to blindly set a 10% growth goal across the board for 2024 compared to 2023. Or, that lender could use forward-looking data to understand the realities of the market, set more realistic organizational goals, and use granular data to inform goals for individual mortgage loan officers (MLOs). 

Realistic, market-driven goals help keep MLOs motivated—knowing the goals are attainable, yet challenging, and backed by data. 

Finding Areas of Growth

For the next few years, Chicago will be a tough market for growth—unless you know where to look. With iEmergent’s data, lenders can uncover pockets of growth by geography, loan type, borrower segment, and more. Let’s look at a few areas that do offer opportunity for growth in Chicago in 2024 (and beyond). 

Diverse Borrower Segments

$123.1 million of the growth in Cook County from 2023 to 2024 will be to Asian, Hispanic, and Black borrowers. To find these loans, you have to know where to look. Here’s how loans to diverse borrowers are forecasted to be spread throughout Cook County in 2024.

Loans to Black Borrowers

If you know the Chicago market, this won’t surprise you—loans to Black borrowers are concentrated downtown and on the south side.

Chicago - black dollars

Loans to Asian Borrowers

Loans to Asian borrowers are also concentrated downtown as well as on the north side.

Chicago - Asian dollars

Loans to Hispanic Borrowers

Loans to Hispanic borrowers are spread throughout the county.

Chicago - hispanic dollars

Can you tell which census tract will be the highest volume for loan dollars to Hispanic borrowers?
See for Yourself

Our data also show that 37.6% of Cook County’s growth from 2023 to 2024 is forecasted to be in majority-minority census tracts (MMCTs).

iEmergent Chicago MMCT Opp

LMI and CRA Census Tracts

While LMI (low- to moderate-income) tracts, which are CRA eligible, are expected to grow $21.4 million from 2023 to 2024, non-LMI tracts are expected to shrink. 

Let’s look at LMI opportunity in LMI census tracts. 

In this map, we can see where loans to LMI borrowers are forecasted to be in 2024 in Cook County, IL.

Chicago - LMI Opp

Now let’s see the LMI census tracts in the county:

Chicago - CRA Eligible Tracts

Finally, we can overlay the two visualizations in Mortgage MarketSmart to cross-reference LMI opportunity in LMI census tracts. Here, we can quickly point out several census tracts in which reaching LMI borrowers could be a focus.

Chicago - LMI CT Detail

All of these insights show that while the Chicago market is forecasted to contract after growing slightly, there are areas of growth. You just have to know where to look—and have the data to show you the way.

Put Data and Insights to Work

Imagine having this data (and more!) for your markets. What kind of strategies could you plan? How would your 2024 look different? 

Forward-looking data—combined with historic, current data, and innovating analysis tools—set lenders apart. If you want to grow in 2024 (or hit your remaining 2023 goals), let’s talk.
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All maps and data in this email are from iEmergent’s proprietary forecasts and Mortgage MarketSmart’s suite of market intelligence tools.

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