Quote:
Originally Posted by ardecila
Sure it does. More developable land means land is cheaper. The price of new housing is almost entirely the price of land + cost of construction.
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It matters relative to demand in certain ways, and that's the point. There's a reason why the same new construction home in Lincoln Park costs 50%+ more than in Irving Park, Avondale, etc even when there's not much developable land in those areas.
So the point is ultimately, that a lot of people ("luxury" or otherwise) are not willing to live in a lot of areas of Chicago due to various reasons (safety being a major one) but totally willing to live in other areas due to the same reasons (i.e. it being much safer, more walkable, etc). New construction wise, the parts of town on the north side, downtown, etc will continue to rise in COL because the demand is great for these areas, and there's still enough properties (current building or land) that are cheap enough for developers to buy up, knock down, and put something new on but usually less than 5 units in size. If you are a developer with the ability to invest $2M for some market rate housing, chances are that you aren't about to create some new housing in Englewood if you had the opportunity to do so in some north side neighborhood. At least until some other areas of town on the south side legitimately getting more demand - there's really only a few of those areas that have the ability right now to even take demand away from a lot of north side areas.
This will continue until the perceived safety threat in other areas (real or otherwise) goes down. Even areas like Bronzeville, which has ample new construction (and pretty nice looking interiors) in the last many years has that stigma still even though some areas on north/northwest side are similar in terms of safety statistically.