Illinois REALTORS® and the Chicago Association of REALTORS® are submitting testimony for the record to the Chicago City Council Housing and Real Estate Committee regarding the “Bring Chicago Home” transfer tax proposal.

“REALTORS® recognize the importance of having a place to call “home” and the stability that it provides to the individual, the community and our city. In many ways we agree with the overall purpose of “Bring Chicago Home,” however this proposal is not the solution to that issue.

We believe the best solution to homelessness is a comprehensive and creative approach, but without imposing a greater burden on homeowners.”

Here is a copy of the full testimony:

Illinois REALTORS® and the Chicago Association of REALTORS® appreciate the opportunity to provide comments regarding the “Bring Chicago Home” proposal. REALTORS® recognize the importance of having a place to call “home” and the stability that it provides to the individual, the community and our city.

In many ways we agree with the overall purpose of “Bring Chicago Home,” however this proposal is not the solution to that issue.

We believe the best solution to homelessness is a comprehensive and creative approach, but without imposing a greater burden on homeowners.

REALTORS® have a long history of supporting legislation to provide solutions for those with no home that also would ease our state’s dire housing supply shortage. Our most recent efforts include supporting the work of Governor Pritzker’s Homelessness Task Force and HOME Illinois program, while also advocating for zoning reform and affordable housing development.

At this point in time, Chicago’s housing market is struggling. High interest rates, low supply, and a nightmarish property tax system have slowed a historically active and healthy real estate market. In June alone, housing sales were down year-over-year by over 25% and the supply of homes compared to a year ago is down over 30%. Adding to the concern is the increasing number of commercial vacancies and office building defaults. Just here in Chicago the office vacancy rate has almost doubled since before the pandemic began.

Tripling the transfer tax, especially in these conditions, would be detrimental to not just the real estate market, but to the city’s entire economy.

We have met with proponents of the proposal to understand their plan for increasing revenue to bolster current services. While we respect the coalition’s efforts and understanding of the issue, we believe market realities and incentives require stronger consideration.

First and foremost, the proposal has a low floor at $1 million, which severely restricts community development. Plus, the plan does not account for long-term solutions like streamlining the process of repurposing vacant commercial buildings to housing or building middle-income housing to free up affordable housing units. To date, we have not heard consideration of a high-end cap, or phasing in the tax to allow Chicago’s bearish housing market time to rebound. Further, we have not discussed diverting the current transfer tax revenue going to the CTA to housing-related programs given the direct nexus

of real estate taxes and housing. Instead, the proposal is centered on many policies that are not solutions to the long-term sheltering of those in need, such as right-to-counsel.

REALTORS® believe in centering discussions around increasing housing supply and fostering a healthy, commercial real estate environment. The Chicago Department of Housing has claimed many times that there is a shortage of 120,000 housing units throughout the city. We welcome conversations about reforming zoning, building units at 120% of the area median income (AMI) and below, implementing tax relief for buyers and sellers of affordable housing, and holding the Chicago Housing Authority accountable for the alarming state of the Housing Choice Voucher program and public housing waitlist.

These are just a few long-term, sustainable solutions to housing instability, but we need to have these conversations.

Again, REALTORS® understand, and in many ways agree with, the overall goals of the “Bring Chicago Home” proposal. We would like to continue working with the coalition to find a comprehensive solution to homelessness as well as available and affordable housing in our fair city.