One reason, Shakoor believes, is that, thanks to COVID and the anxiety of these times, “we feel a need to release. Let go of the past.” Another reason could be that people who’ve kept their jobs, watched their stock wealth swell and bought a home at a super-low mortgage rate feel comfortable spending to make the home just right.
Business has grown by about half in 2021 at Shakoor Interiors, based on 15th Street near UIC, its namesake says, “and I can already see it’s going up by 50% again in 2022,” with the jobs she already has booked. A two-person firm in 2020, it added a third this year and will add another next year, she said.
Home sales have been surging since the early months of the pandemic era. By the end of November, 2021 was already the Chicago metro area’s highest-volume year for home sales since 2006, with about 127,100 transactions and still with a month of sales to go. Recent months’ reports suggest at least 10,000 homes will sell in December. That means that unless the whole thing sputters out this month, at the end of the year home sales will have easily surpassed the all-time record year—2005—when about 133,300 homes sold, according to archived data from Illinois Realtors.
From June 2020, when the pandemic-driven boom first began registering as closed sales, through the end of this year, at least 220,000 homes will have sold in the nine-county metro area. Those sales will have about $81.8 million in economic impact in Illinois.
Crain’s arrived at that figure using the National Association of Realtors estimate that each home sold generates about $37,200 as additional spending by the homeowner, income for the real estate agents and other professionals involved, and the multiplier effect of those dollars circulating in the economy, (The NAR report includes an additional $37,900 for the purchase’s spur to new home construction, but on the advice of housing industry sources, Crain’s eliminated that.)
This might be a conservative estimate, given the indulgent spending that Shakoor and others describe.
One business you’d expect to be extra busy because so many people are changing addresses are moving companies, but leaders of a couple of local firms said their ability to take on extra business is severely hindered by the lack of workers who will take low-wage jobs now.
Whatever they’ve spent after the home purchase, homebuyers have likely considered it an investment in their family’s well-being, suggests Linda Tuncay Zayer, a professor of marketing and acting associate dean at Loyola University’s Quinlan School of Business.
“Home has always been a center of family life,” Zayer says, “but now we see a consumer mindset that home is a sanctuary—a safe, calm, comfortable place amidst all the chaos.”
With their spending on vacations, dining and other out-of-home entertainments curtailed, “spending money on your home feels like a safe bet,” Zayer says.
Even faced with supply chain shortages on furniture, appliances and other materials for home upgrades, Zayer says, “consumers have been willing to wait to get what they want,” because of the higher value they place on home.
“Clients have been very patient” about supply chain issues, says John Plunkett, who after shuttering his family’s chain of nine furniture stores opened an interiors business now based in Wilmette. “They know what’s going on out there. They understand why they have to wait.”
Clogs in the furniture supply chain have turned some shoppers’ attention to readily available antiques, but even so, says Mark Schumacher, CEO of the California-based Home Furnishings Association, buyers who go for new furniture are spending more.
“The average ticket is higher, much higher than before the pandemic,” Schumacher said, though he declined to cite specific figures. Some of the increase is due to inflation, he said, but some is because “people are excited to start with a blank canvas in their new home.”
Schumacher, Shakoor and Zayer all said a factor in the extra spending may be that there’s more to be done. With the inventory of homes for sale skin-tight, some buyers are having to make do with a house that’s “less than perfect for them,” Zayer said, and count on bringing it up to snuff. There’s also the increasing focus on having home offices, Schumacher and Shakoor said, rooms that often demand a build-out of technology and shelving that wouldn’t be needed if the space were just a guest bedroom.
“I’m busier than I’ve ever been in 30 years of doing this,” says Christine Mitchell Roman, head of the Loop-based renovation and interiors firm CMD Planning and Design. “I’m almost to the point where if the phone rings and I don’t recognize the number, I’m like, ‘Oh, do I even want to answer this?’ ”
It’s the opposite of what she initially expected when the pandemic overturned life as we knew it. “I thought people were going to be afraid to spend money on luxury,” she recalls, before laughing at her—and everyone’s—naivete about the changes the pandemic would deliver.
By summer 2020, she said, it was clear that “people aren’t going to be skimping.”
Roman’s experience with clean-slate clients echoes Shakoor’s: “People aren’t bringing a lot of their old furniture,” she says. “I think the pandemic put a bad taste in their mouth and they want to start from scratch.” That mindset fuels a trend Crain’s noted in the spring, where buyers started asking to buy homes fully or mostly furnished.
For Roman, the rub in this busier-than-ever phase is that another phenomenon of 2021 gets in the way. She’d like to expand her staff to accommodate more clients, but “good luck,” she says. “I can’t find people.”
Ken Miller has the same problem. Miller, who heads Wm. Meyers Movers, an Itasca firm founded by his grandfather a century ago, said that while the number of people who are moving to a new address may have risen, he’s limited to what his 18-person team can do.
“We haven’t had anybody, zero, apply for a job” in months, Miller says. It’s a relatively low-paying job, he says. His rate for labor is $48 an hour, which sounds good, but “they can go to an auto dealership, where the rate is probably $100 an hour” and the work doesn’t require heavy lifting.
Miller acknowledges he hasn’t aggressively hunted for new employees, in part because steady demand has kept the job board full for the people he has. “But if I had more people wanting to work,” he says, “I could do all the business I want.”
Jim Lalagos, president of Advanced Moving & Storage in Glendale Heights, concurs.
“The amount of business that a moving company can handle is based on the number of trucks they can staff,” Lalagos says, “and we have not been able to staff all our trucks, so unfortunately we’ve set a limit on how many jobs we can do.”
Lalagos says about 10 employees, or about 30% of what he had before the pandemic, have left and he hasn’t been able to replace them.
But people still need to move their stuff from one address to another. Lalagos says he tries “to get people to be flexible with their dates. Instead of moving on the 30th, move on the 29th.”
The benefit to Advanced and its employees of the home-buying surge, Lalagos says, is that while in normal years there are long stretches with little work, such as the first few months of a calendar year, in the housing boom, “we’ve kept working all the time.”