Chicago and the suburbs added few new homes in the past decade, according to the census. Here’s what that means for the region

The Chicago region added few new housing units in the past 10 years, new census data shows, and the effects of that might be playing out in the market today as buyers scramble to nab a limited supply of available homes.

The number of homes in the Chicago metro area grew by 3.9% between 2010 and 2020, census data made public Thursday shows. That was a slower growth rate than the nation overall, where the number of homes grew by 6.7%.

The slow housing growth was not surprising, as the region recovered from the 2008 housing and financial crisis.

“The region was slow to recover from 2008, for different reasons ... and we just got kind of stuck,” said Janet Smith, co-director of the Nathalie P. Vorhees Center for Neighborhood and Community Improvement at the University of Illinois at Chicago.

Among Cook and the collar counties, only Kendall County added homes at a higher rate than the nation: 11.6%. It added more homes than any county in the state, likely reflecting the county’s explosive growth in population over the past decade.

While the Chicago area posted slow housing growth, 72 of 102 Illinois counties lost housing units. Housing units statewide grew by 2.4%.

Tighter lending standards spurred by the Great Recession and the hesitancy it created in the market likely stifled some development of new homes over the past decade, said Michael Golden, co-CEO of @properties. Rising building costs and what he described as tight rules created by Chicago and some other municipalities might also have contributed, he said.

The low number of new homes that resulted is likely one of many factors contributing to low inventory and high prices in the housing market now, he said.

“There’s no housing crisis right now, but there’s definitely demand to be met for new housing,” he said.

But to urban planner and researcher Pete Saunders, the number of homes created in the past 10 years is about what should be expected given the state’s population trends, he said. It’s just that the homes may not necessarily have been built in places people want to move, or at affordable rates, he said.

The census housing data was released with population information that showed Chicago grew slightly, by about 50,000 people, in the past 10 years, as population growth in the suburbs slowed to a crawl. Illinois as a whole lost population, one of just three states nationally to lose residents over the last decade.

The Chicago area’s population growth could be good news for the housing market, inspiring investors and developers to take a deeper interest in the city, Smith said.

Specific information about the type of housing units added, their affordability, and the neighborhoods where they are located was not included in the most recent data release, making it difficult to draw conclusions about whether the available housing matches the needs of residents, or what it means for Chicago’s shortage of affordable homes, she said.

More detailed information about housing is expected in the coming months.

“In the region, we have seen a growth in population, we have seen a growth in housing units,” Smith said. “The rate of change is not as high as the U.S., probably because we had some surplus still and some challenges from the recession. And the big question mark is, if we’re going to use this data to add to or increase development, who is it going to be for?”