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Other factors affecting the market right now for developers are cost increases. Land, labor and materials are all going up and it all affects the feasibility of a project. Loewenberg says developers "estimate what the increases will be and pass it on to the buyer. You have to."

Lawton points out that Chicago is still very affordable in comparison to other cities, especially both coasts. Lev adds that a developer has to determine what kind of return you'll get from a project. "The product type is important. Townhomes often are lower risk because you can spread out the cost over a longer period of time. You can't do that with a high-rise." Laura Sherman, senior vice president, LR Development, says that the demographics for buyers have become much broader. "The appeal of living in the city has become much more widespread. Many suburbanites have decided to make a move."

One aspect of the rental arena that is hard to track is the shadow market. Lawton explained that there are some condominium properties that could be 40 to 50% rented out by investors who bought those units for that reason. "They use a different marketing strategy to rent out those units," he says.