I recently posted this article discussing the approximate costs to build a new single family on the north-side of Chicago. With that information in hand, is this North Center vacant lot a deal at only $250,000? Let’s take a look.
If we look at the data from my previous analysis, we see the median price of a teardown in North Center / Coonley is approximately $450k. 1801 W Cuyler is asking $200k below this, and the land is vacant, so a buyer would save an additional $20k in demolition costs. $220k cheaper than other lots? Sold! Not so fast. What is important to note here is that the $450k median price is for mostly standard-sized Chicago lots of 125 x 5, and 1801 W Cuyler is on a much narrower, 17.5ft-wide lot. That 7.5ft is significant as a buyer would either have to build a narrow home, or get variances from the city to build closer to the lot lines. Additionally, the house sits across the street from the Metra and a few houses down from the Brown line. On the flip side, the Metra noise is pretty nominal and the house is less than a one minute walk from the Irving Park Brown line station. Plus, you are directly across the street from Begyle Brewery, which is cool place to pop in and have a post-work beer.
Based on my analysis that states a new home should cost approximately $150-$175 / sq ft to build a new house, this suggests a 3,000 square foot home (the zoning of this property allows for approximately 2,000 sq ft above grade, but I am including basement since listings I chose for my previous analysis did as well, even though not technically correct to do so) should cost somewhere between $450,000 and $525,000 to build. Let’s take the midpoint of these two figures and say a buyer is all-in for $737,500 (I added $50k for carrying costs while house is being built). Is $737,500 a good price to be in at?
Assuming a buyer goes the route of getting a variance so the house isn’t excessively narrow, this would be a great deal, in my opinion. The house would ultimately end up only being around four feet narrower (between 15 and 16 feet wide total) than a house on a standard lot. I put together some renderings of what a house could potentially look like on the lot:
As you can see from the renderings, the house is narrower than ‘normal’, but by no means small or awkward. 1813 W Cuyler, a very nicely-updated, 3,100 square foot house three doors down, is under contract in less than two weeks after being listed for $1mm. Assuming it closes around that price, the buyer of 1801 W Cuyler would be in their house for $250k+ less, and have a 100% brand new house (and have less noise from the Brown line). Additionally, if we look at my recent analysis of home costs in the Coonely district, we see $1mm+ is what it takes to get a SFH in the area (that doesn’t require significant work). Is saving a quarter million dollars enough of an incentive for a buyer to live in a narrower, but brand new, home? The market will ultimately tell us, but I personally think this could be a great option for the right buyer.