Lake Forest, Illinois, a picturesque suburb north of Chicago, has long been synonymous with wealth, elegance, and sprawling estates. Its real estate market has experienced several booms over the years, shaped by historical events, economic shifts, and changing societal needs. From its origins as a planned community in the mid-19th century to its resurgence during the COVID-19 pandemic, Lake Forest’s real estate history is a fascinating tale of adaptation and allure. This blog post delves into the key periods of growth, the factors driving these booms, and the unique characteristics that continue to make Lake Forest a sought-after destination for homebuyers.
Early Beginnings: A Planned Suburban Oasis (1850s–1880s)
Lake Forest was founded in 1857 as a carefully designed suburban retreat for Chicago’s elite. The Lake Forest Association, formed by prominent businessmen, envisioned a community that combined natural beauty with accessibility to the city. The arrival of the Chicago and North Western Railway in 1859 was pivotal, enabling daily or weekly commutes to Chicago, though such travel was rare until after the Great Chicago Fire of 1871.
In its infancy, Lake Forest’s real estate development was modest and concentrated near the railroad station. The first properties, developed in 1859, were built within a block or two of the station, along streets like Deerpath and University (now Sheridan Road). These early estates, typically set on lots of two or more acres, featured large homes set back from the street, accompanied by carriage houses, greenhouses, or servants’ cottages. The town’s curvilinear street design, inspired by the picturesque suburban village ideal, ensured open lawns and gardens without fences, creating a distinctive aesthetic.
Initially, lakefront property along the Lake Michigan bluffs was considered undesirable, with only two families—William Mays and T. J. Kirks—building homes there by 1870. However, by the 1880s, the appeal of the bluffs became evident, and estates began to dot the shoreline, setting the stage for future development. The post-Chicago Fire era saw a gradual expansion of estates in a fan-shaped area from the railroad station to the cemetery in the north and the female academy in the south.
The Gilded Age Boom: Chicago’s Elite Arrive (1890s–1917)
The late 19th and early 20th centuries marked Lake Forest’s first significant real estate boom, as it became the premier suburb for Chicago’s wealthy seeking second homes or permanent residences. By the mid-1890s, the town’s reputation for spacious estates and natural beauty attracted notable figures, including industrialists and architects. In 1890, Chicago architect Henry Ives Cobb pioneered development west of Green Bay Road, building a large estate that inspired others, such as William Smith and David Jones, to follow suit with Cobb-designed homes.
This period established several developmental patterns that defined Lake Forest’s real estate market for decades. Wealthy buyers purchased existing estates, particularly along the desirable lake bluffs, demolished older structures, and rebuilt grander homes. Others, like William Smith in 1894 and Edward Ryerson in 1915, relocated within Lake Forest, selling one estate to build another in a more prestigious location. Subdivision of large estates also became common, either to accommodate family members or to create space for new buyers as prime land grew scarce.
The Gilded Age boom solidified Lake Forest’s status as a haven for Chicago’s elite, with estates reflecting the era’s opulence. The town’s low property tax rate—5.3%, the lowest in Lake or Cook County—further enhanced its appeal. These early estates, often spanning multiple acres, set a precedent for the large, traditional homes that would characterize Lake Forest’s housing market for generations.
Mid-20th Century: A Quiet Evolution (1920s–1960s)
While Lake Forest’s real estate market remained stable through the early 20th century, the 1920s and 1930s were marked by broader economic volatility, including the Florida Land Boom and the Great Depression. Unlike speculative markets in Florida, where prices soared and crashed dramatically, Lake Forest’s real estate was insulated by its established wealth and limited inventory. The town’s focus on large estates and its resistance to speculative development preserved its exclusivity.
The 1950s brought a national housing boom, fueled by post-World War II prosperity, the GI Bill, and the growth of the middle class. Suburban Chicago saw rapid expansion, with many suburbs doubling in size between 1950 and 1960. Lake Forest, however, grew more modestly, by about 30%, as the community resisted becoming a middle-class suburb. The town’s preference for traditional architecture also led to the rejection of modern housing styles, with many mid-century homes built during this period later demolished in favor of more classic designs.
Despite this resistance, the 1950s introduced subtle changes to Lake Forest’s homes. The rise of the family room, often added to the back of houses with direct backyard access, reflected a shift toward informal living. Innovations like the home freezer, developed by local inventor Willard Morrison, and the widespread adoption of televisions transformed domestic life, influencing home design and layout. These adaptations laid the groundwork for Lake Forest’s ability to balance tradition with evolving lifestyle needs.
The Pandemic-Driven Boom: A Modern Resurgence (2020–2021)
Lake Forest’s most recent and dramatic real estate boom occurred during the COVID-19 pandemic, particularly in 2020–2021. As urban dwellers sought refuge from city life, the suburb’s large homes, expansive properties, and low taxes became irresistible. Historically low interest rates further empowered buyers, making high-end homes more accessible.
Before the pandemic, Lake Forest’s real estate market had been sluggish. In 2017, officials launched a “Welcome Home” campaign to attract families concerned about Chicago’s rising crime rates, emphasizing the suburb’s safety and spacious properties. By 2020, the definition of safety had shifted. Buyers sought homes where they could work, school, and recreate without leaving their property, and Lake Forest’s inventory of large homes on multi-acre lots perfectly met this demand.
The market transformed almost overnight. In the six months ending October 25, 2020, 367 homes sold, surpassing annual sales averages of 320 from the previous four years. August 2020 saw sales double from the previous year, and September 2020 sales surged by 130%, with 60 homes sold compared to 26 in September 2019. Inventory plummeted from a 14-month supply to just three months, signaling a seller’s market.
Buyers, many from Chicago’s Lincoln Park and other urban neighborhoods, were drawn to properties like the $4 million, 10,800-square-foot colonial revival on Westminster Avenue, which offered ample space for home offices, schooling, and recreation, including an outdoor pool. The proximity to Lake Forest’s Market Square, the Metra station, and the town beach added to the appeal. Agents noted that buyers valued the ability to maintain city homes for weekends while using Lake Forest as a primary residence or retreat, reflecting a hybrid lifestyle enabled by remote work.
Current Trends and Future Outlook (2025)
As of March 2025, Lake Forest’s real estate market remains robust but has cooled slightly from its pandemic peak. The median home price is $1,075,000, up 10.8% from the previous year, with 118 homes for sale, a 25.5% increase from February 2025. Homes spend an average of 33 days on the market, down 41% from the prior year, indicating continued demand. The market is somewhat competitive, with some homes selling above asking price, particularly “hot” properties that go pending in about 32 days.
Migration patterns show that 84% of Lake Forest homebuyers are local, staying within the metropolitan area, while 16% look to move out, with destinations like Cape Coral, Phoenix, and Sarasota gaining popularity. Interest from outside metros, such as Peoria, New York, and Springfield, underscores Lake Forest’s broad appeal.
Looking ahead, Lake Forest faces challenges like rising temperatures, with projections of 14 days above 98ºF in 30 years, which could influence home design and infrastructure. However, the suburb’s enduring strengths—low taxes, large properties, and proximity to Chicago—position it well for future growth. The shift toward remote and hybrid work may continue to drive demand for spacious homes, while the town’s commitment to preserving its historic charm ensures its timeless allure.
Conclusion
Lake Forest’s real estate booms reflect its ability to adapt to changing times while maintaining its identity as an exclusive, elegant suburb. From its planned origins in the 1850s to the Gilded Age influx of Chicago’s elite, the mid-20th-century evolution, and the pandemic-driven surge, each boom has been driven by unique economic and social forces. Today, Lake Forest continues to attract buyers seeking space, safety, and sophistication, cementing its place as one of America’s most desirable suburbs. Whether driven by railroads, wealth, or remote work, the history of Lake Forest’s real estate is a testament to its enduring appeal.
