2026 Chicago Housing Market Forecast: What Buyers & Sellers Need to Know

The Chicago housing market is entering 2026 with a renewed sense of momentum. After several years defined by affordability challenges, tight inventory, and interest-rate realities, this year’s forecast signals price growth, stronger sales activity, and opportunities for both buyers and sellers alike. Whether you’re planning to buy your first home, sell and upgrade, or invest in Chicagoland real estate, understanding the latest data and trends is crucial.

Below, we break down the key predictions for 2026 — from pricing trends and sales forecasts to what factors will shape decisions in the year ahead.

Chicago Market Predictions: Sales & Price Growth

According to the Illinois REALTORS® 2026 Annual Forecast, the Chicago metropolitan area is projected to see:

• A 5.1% increase in closed home sales compared with 2025, signaling a stronger and more active market next year.

• Median home prices in the Chicago metro area are expected to grow by nearly 5% year-over-year in 2026.

These forecasts show that demand remains healthy, even in an environment where affordability and inventory have challenged buyers. Rising sales activity suggests that Chicago may finally see a more sustained balance between supply and demand.

What This Means for Chicago Buyers

For homebuyers in 2026:

• Moderate Price Increases, But Still Growth

  Chicago’s median home prices are forecast to increase, though not at the extreme rates seen in earlier post-pandemic years. A nearly 5% median price rise reflects steady demand and the limited supply of homes — especially in desirable neighborhoods.

• More Inventory and Market Options

  Markets are showing signs of inventory improvement, giving buyers more choice than recent years. While supply remains tighter than pre-pandemic norms, modest gains can help alleviate some of the previous competitive pressures on buyers.

• Affordability Remains a Key Factor

  Though interest rates remain elevated compared to historical lows, many industry forecasters — including national economists — expect a slight easing in mortgage rates in 2026, improving affordability for buyers entering the market.

  Pro Tip: Work closely with a mortgage professional early in your search to lock in favorable terms and understand your purchasing power before you start house hunting.

What Sellers Should Expect in 2026

For sellers, 2026 presents a positive climate — especially for those in well-priced and move-in-ready homes.

• Steady Demand Keeps Prices Up

  With prices forecast to rise and sales activity increasing, sellers can expect continued interest, especially in popular metro neighborhoods and desirable suburbs.

• Less Pressure Than Peak Seller Markets

  Unlike the frenzy of 2020–2021, 2026 isn’t expected to be a “seller’s market” driven by record inventory shortages. Instead, it’s shaping up to be balanced — letting sellers get strong offers while still giving buyers choices.

• Pricing Strategy Is Key

  Because price growth isn’t expected to skyrocket, smart pricing strategies — backed by data and local comps — are crucial. Sellers who correctly position their homes can capture competitive offers without stretching pricing beyond what buyers are willing to pay.

Market Trends Shaping 2026

• Interest Rates and Affordability

  Industry forecasts indicate that mortgage rates could trend lower in 2026, settling around the low-to-mid 6% range — making homebuying more accessible than the past few years.

• Return to “Normal” Market Conditions

  Experts see 2026 as a year of normalization following the pandemic’s volatility. This means more balanced negotiations, realistic buyer expectations, and a healthier pace of sales, inventory turnover, and price growth.

• Regional Resilience

  Chicago’s market fundamentals — strong job markets, stable demand, and continued population growth in key suburbs — help support price stability and buyer interest compared to other U.S. metros.

Bottom Line: Chicago Real Estate in 2026

In 2026, the Chicago housing market is forecast to strengthen — with notable gains in home sales, continued price appreciation, and more balanced conditions that benefit both buyers and sellers. While affordability challenges persist, many buyers will find improved inventory and slightly better financing conditions compared to recent years.

Whether you’re thinking about selling a long-loved property or searching for your next home in Chicago, staying informed with data-backed insights will be your greatest advantage.

Ready to Make Your Move in 2026?

For expert guidance on pricing, negotiating, and timing your real estate strategy, connect with a local Chicago market specialist today.

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Ranked as a top 1% team in the Chicagoland market, Cory Tanzer and the Cory Tanzer Group specialize in the Chicago, North Shore, and Western Suburbs real estate market. With deep local market expertise and a proven track record, Cory and his team help clients buy and sell with clarity, confidence, and results.