So, you're curious about the current Chicago housing market trends? You're not alone! Whether you're looking to buy, sell, or just keep an eye on things, understanding the market is key. In short, while things have cooled off a bit from the crazy days of the pandemic, the Chicago market remains relatively stable. Home prices are still appreciating modestly, but inventory remains tight, creating a slightly competitive environment for buyers. Let's dive into the details and see what's really happening in the Chicago real estate scene.

Chicago Housing Market Trends: What's Happening Right Now?

Home Sales

One of the first things to look at when assessing the health of the market is the number of homes being sold.

• Chicago Metro Area: According to Illinois REALTORS®, in May 2025, we saw 8,689 closed sales, which is a 4.9% decrease compared to May 2024 (9,135). Year-to-date, the Chicago metro area has seen 33,662 closed sales, a 0.8% decrease from the same period last year (33,940).
• City of Chicago: The City of Chicago saw 12,674 closed sales in May 2025, a 4.7% decrease compared to May 2024 (13,300). Year-to-date, closed sales in the city are at 49,378, a 0.8% decrease from the same period last year (49,788).
• Illinois: Across the entire state, closed sales in May 2025 totaled 12,674, which is 4.7% less than the previous year’s sales (13,300). So far, in 2025 there have been 49,378 closed sales, a 0.8% decrease compared to the 49,788 sales during the same period last year.

What does this mean? Well, fewer sales could indicate a few things. It might be that fewer people are listing their homes, or perhaps buyers are being more cautious. Let's look at prices to get a clearer picture.

Chicago  Home Prices

Alright, let's talk about what everyone really wants to know: how much are homes going for?

• Chicago Metro Area: The median sales price in the Chicago metro area in May 2025 was $379,900, a 5.5% increase from $360,000 in May 2024.
• City of Chicago: In the City of Chicago, the median sales price in May 2025 was $315,000, a 5.0% increase from $300,000 in May 2024.
• Illinois: The median sales price across the entire state in May 2025 was $315,000, marking a 5.0% increase from $300,000 in May 2024.

Are Home Prices Dropping in Chicago?

No, not exactly. While sales are down slightly, prices are still going up. It's not the crazy double-digit growth we saw a couple of years ago, but it's still appreciation. This suggests that demand is still relatively strong, even with higher mortgage rates.

Housing Supply

Now, let's look at the inventory of homes available. This is a crucial factor in determining whether it's a buyer's or seller's market.

• Chicago Metro Area: In May 2025, there were 13,195 homes for sale in the Chicago metro area, which is a 3.4% increase compared to May 2024 (12,759).
• City of Chicago: The city had 19,890 homes on the market in May 2025, which is a 6.0% increase compared to May 2024 (18,758).

An increase in inventory is generally good news for buyers, giving them more options to choose from and potentially more leverage in negotiations.

Days on Market Until Sale

How long are homes sitting on the market before they sell? This is another important indicator.

• Chicago Metro Area: Homes in the Chicago metro area were on the market for an average of 29 days in May 2025, compared to 28 days in May 2024, a 3.6% increase.
• City of Chicago: In the City of Chicago, homes were on the market for an average of 33 days in May 2025, compared to 32 days in May 2024, a 3.1% increase.

A slight increase in the days on market suggests that the market is cooling down a bit. Homes aren't flying off the shelves as quickly as they were a year or two ago.

Is Chicago a Buyer's or Seller's Housing Market?

This is the million-dollar question! Based on the data, I'd say it's currently a balanced market, leaning slightly towards a seller's market. Here's why:

• Prices are still rising: Sellers are still getting more for their homes than they were a year ago.
• Inventory is increasing: But not dramatically. While there are more homes on the market, supply is still relatively constrained.
• Days on market are slightly up: But homes are still selling relatively quickly.

Market Trends

So, what are the overarching trends we're seeing in the Chicago housing market?

• Modest Price Appreciation: Prices are still going up, but at a more sustainable pace. We're not seeing the bidding wars and rapid escalation that characterized the market in 2021 and 2022.
• Slightly Increased Inventory: More homes are coming onto the market, giving buyers more choices.
• Longer Time on Market: Homes are taking a bit longer to sell, giving buyers more time to consider their options.
• Balanced Market: Overall, the market is relatively balanced, with neither buyers nor sellers having a significant advantage.

Here's a quick table summarizing the key data points:

Metric	Chicago Metro Area (May 2024)	Chicago Metro Area (May 2025)	Change (%)	City of Chicago (May 2024)	City of Chicago (May 2025)	Change (%)
Closed Sales	9,135	8,689	-4.9%	13,300	12,674	-4.7%
Median Sales Price	$360,000	$379,900	+5.5%	$300,000	$315,000	+5.0%
Inventory of Homes for Sale	12,759	13,195	+3.4%	18,758	19,890	+6.0%
Days on Market Until Sale	28	29	+3.6%	32	33	+3.1%

Impact of High Mortgage Rates

Of course, we can't talk about the housing market without mentioning mortgage rates. Currently, U.S. weekly averages as of 07/17/2025, the average 30-year fixed mortgage rate is around 6.75%, and the 15-Year FRM is about 5.92%, according to the Primary Mortgage Market Survey® by Freddie Mac. The 30-year fixed-rate mortgage inched up this week and continues to stay within a narrow range under 7%.

These rates are significantly higher than the sub-3% rates we saw during the pandemic, which has definitely impacted affordability. It makes it more expensive to borrow money, which can deter some buyers.

According to various forecasts, the 30-year FRM rate will end 2025 between 6.0 to 6.5 percent. Borrowers should find comfort in the stability of mortgage rates, which have only fluctuated within a narrow 15-basis point range since mid-April.

My Take on the Chicago Market

As someone who's been following the Chicago real estate market for years, I think we're in a period of adjustment. The frenzy of the past few years was unsustainable, and the current market is much more balanced and healthy in the long run.

I think that even though mortgage rates are at 6.75%, people will keep buying homes, especially if rates drop to between 6.0% and 6.5% by the end of 2025. While buying a home has become more difficult, stability in mortgage rates will encourage potential buyers. The market is also seeing a slight increase in inventory, meaning buyers have more choices and greater negotiating leverage.

For buyers, this means you have more time to shop around and negotiate. Don't feel pressured to make a snap decision. Take your time, do your research, and find the right property for you. I encourage buyers to focus on how much they can afford per month rather than obsessing over the interest rate and try to buy homes that fits their lifestyle in the long run.

For sellers, it means you need to be realistic about your pricing expectations. You can't expect to get the same prices that homes were fetching a year or two ago. Work with a knowledgeable real estate agent to price your home competitively and make sure it's in top condition.

The Bottom Line

The current Chicago housing market trends show a market that is stabilizing after a period of rapid growth. Prices are still appreciating, but at a more moderate pace. Inventory is increasing slightly, and homes are taking a bit longer to sell. While higher mortgage rates are impacting affordability, the market remains relatively balanced. Whether you're a buyer or a seller, understanding these trends is crucial for making informed decisions.

Chicago Housing Market Forecast 2025-2026: What's Coming Up?

Based on the latest data, the Chicago housing market forecast for 2025 looks promising. We can expect a modest level of sales increase and home prices are likely to continue to grow into next year too! The projected increase is nearly six percent compared to 2024! Keep reading to understand the reasoning behind this and the trends that cause these predictions

Let's break down what's been happening recently in the Chicago area housing market. According to the Institute for Housing Studies at DePaul University, here's a snapshot of May 2025:

• There were 8,689 closed sales of houses, townhomes, and condos in the entire Chicago metro area.
• Single-family home prices jumped 6.3% compared to May 2024.
• However, the number of single-family home sales actually went down 3.5% compared to last year.
• Here's a bit of good news for buyers: The number of houses for sale increased by 3.9% since last May.
• Homes are sitting on the market a little longer, about 5.3% (1 day) The market isn't seeing a drastic shift, just a normal fluctuation.

What I gather from these figures is that even though are a little bit highers on the market, the demand is still there, even though there are many reasons why people are hesitant to buy houses.

Chicago vs. the Suburbs: A Tale of Two Markets

It's important to look at how the city of Chicago compares to the rest of the metro area. Here's what's been going on within Chicago itself:

• In Chicago, there were 2,286 closed sales homes.
• House prices in the city soared 9.4% since May 2024. That's a big jump!
• The number of single-family home sales dropped 2.1%, similar to the overall metro trend.
• Here's where it gets interesting: the number of homes for sale in Chicago plunged nearly 16% compared to last year. That means there's a lot less to choose from, which could be driving up prices.
• It took a little longer to sell a house 5.1% (2 days)

It seems to me that the city is a hotter market than the suburbs right now, with prices rising faster and fewer homes available.

Condos and Townhomes: A Different Story?

Let's not forget about condos and townhomes in the city. Here's what's been happening with them:

• Prices for condos and townhomes in Chicago rose 4.4% since May 2024.
• The number of condo sales fell 10%.
• The number of condos for sale is down 11.4%.
• However, condos are selling faster – the time on the market went down 13.4% (3 days).

So, while condo prices are up, fewer people are buying them, and there are fewer available. But when they do sell, they're selling quicker!!

Short-Term Outlook: Summer Sales

What about the next few months? Here's what the Institute for Housing Studies predicts for the Chicago metro area:

• Sales of single-family homes will probably go up and down, peaking in June which will follow seasonal changes.
• The total sales for June, July, and August should be around 3.9% heigher than last year.
• Prices of houses in the Chicago Metropolitan Area are expected to increase slightly before declining throughout the summer months, with overall the price increase being similar to what it was during May.

For Chicago itself:

• Single-family home prices in Chicago are expected to increase slightly between May and August.

Condo prices are expected to decrease slightly between May and August. This is something to keep your eye on.

2026: Peering into the Crystal Ball

While it's tough to say for sure what 2026 will bring, I can offer some thoughts. If interest rates stay relatively stable or even decrease, this could make homes more affordable and boost sales. We might see a continued increase in home prices, but at a more moderate pace than what we've seen recently.

On the flip side, if the economy slows down significantly, it could put downward pressure on the housing market.* More people could be hesitant to buy. The economy really does dictate everything! I think the Chicago housing market is more than likely very healthy.

Based on current trends and expert forecasts, I believe the Chicago housing market will remain stable with continued price growth.

Is Chicago a Good Place for Real Estate Investment for 2025?

Population Growth and Trends

Chicago, known for its diverse neighborhoods and rich history, has been experiencing steady population growth over the years. The city's population growth is driven by factors such as employment opportunities, higher education institutions, and cultural attractions. The diverse demographic makeup of Chicago provides a broad tenant pool for real estate investors, making it an attractive market.

• Diverse Demographics: Chicago's diverse population ensures a wide range of tenant preferences and needs, reducing the risk of high vacancy rates.
• Steady Growth: The city's population growth indicates a consistent demand for housing, especially in well-located neighborhoods.

Rehabbed Homes Fix and Flip Opportunities

Chicago's real estate market offers lucrative opportunities for fix and flip investors. Many older properties in desirable neighborhoods are prime candidates for rehabilitation and resale. This segment of the market can yield significant profits for investors with the right skills and resources.

• Older Properties: Chicago has a substantial inventory of older homes that can be acquired at competitive prices and then renovated for profit.
• Increasing Demand: Renovated homes in sought-after neighborhoods are in high demand, allowing for premium pricing.

Economy and Jobs

The strength of the local economy plays a crucial role in real estate market stability. Chicago's diverse economy is bolstered by various industries, including finance, technology, manufacturing, and healthcare. The city offers a robust job market, which is attractive to both renters and potential buyers.

• Diverse Economy: A mix of industries reduces the risk associated with economic downturns in a specific sector.
• Job Opportunities: A strong job market ensures a constant influx of renters and potential homebuyers.

Livability and Other Factors

Chicago's livability is a key factor for real estate investors. The city's vibrant cultural scene, excellent public transportation, and diverse dining options contribute to its appeal. Additionally, the city's commitment to infrastructure and public services further enhances its livability.

• Cultural Attractions: Chicago offers world-class cultural experiences, attracting residents and tourists alike.
• Public Transportation: An extensive public transit system makes it convenient for residents to commute, reducing the importance of owning a car.

Chicago Rental Property Market Size and Growth

The size and growth of the Chicago rental property market are promising for investors. The city's diverse neighborhoods and housing options cater to a wide range of tenant preferences. This, coupled with population growth, ensures a robust and expanding rental market.

• Diverse Neighborhoods: Chicago's neighborhoods offer various housing options, from apartments to single-family homes, appealing to a wide range of renters.
• Growth Potential: With a growing population, the demand for rental properties is likely to continue to rise.

Other Factors Related to Real Estate Investing

When considering real estate investment in Chicago, it's essential to account for various other factors:

• Local Regulations: Familiarize yourself with Chicago's property regulations and tax laws to ensure compliance and maximize returns.
• Market Research: Thoroughly research neighborhoods and property types to identify areas with growth potential.
• Property Management: Whether you plan to manage properties yourself or hire a management company, effective property management is vital for success.

Investing in the Chicago real estate market offers numerous advantages. The city's population growth, diverse demographics, job opportunities, and livability make it an attractive destination for real estate investors. Additionally, the fix and flip opportunities, the size and growth of the rental market, and other related factors provide a solid foundation for potential returns on investment. However, it's crucial to conduct thorough research, stay informed about local regulations, and manage properties effectively to maximize the benefits of investing in Chicago's real estate market.

Highest Appreciating Chicago Neighborhoods

Chicago has witnessed significant changes in its neighborhoods since the year 2000. Here are the neighborhoods that have experienced the highest appreciation in terms of property values, according to Neighborhoodscout.

W Wabansia Ave / N Whipple St

Located in the heart of Chicago, the W Wabansia Ave / N Whipple St neighborhood has seen remarkable property value appreciation. This area's proximity to various amenities and its strong community appeal have contributed to its growth.

Humboldt Park Northeast

The Humboldt Park Northeast neighborhood has seen a steady increase in property values since 2000. The neighborhood's green spaces, cultural attractions, and improving infrastructure have made it an attractive destination for homebuyers and investors.

W Wabansia Ave / N Kimball Ave

This neighborhood, situated near W Wabansia Ave and N Kimball Ave, has experienced substantial property value appreciation. The presence of local businesses, parks, and good public transportation options has boosted its desirability among residents and investors.

Palmer Square East

Palmer Square East is another neighborhood that has seen significant appreciation in property values. Its charming streets, proximity to parks, and vibrant local scene have made it a sought-after area for both residents and real estate investors.

W Wabansia Ave / N Francisco Ave

The W Wabansia Ave / N Francisco Ave neighborhood has been on an upward trajectory in terms of property values. Its location and access to various amenities have attracted homebuyers and investors looking for long-term growth.

Logan Square Northwest

Logan Square Northwest is known for its thriving arts and dining scene. The neighborhood's cultural appeal, coupled with improved public services and transportation, has contributed to its property value appreciation.

W Cortland St / N Mozart St

W Cortland St / N Mozart St is a neighborhood that has experienced remarkable growth in property values. Its accessibility to urban conveniences and a sense of community have made it a desirable place to live and invest.

Palmer Square

Palmer Square, located in Chicago, has seen substantial property value appreciation. The neighborhood's green spaces, historic architecture, and community activities have made it a popular choice for homeowners and real estate investors.

Humboldt Park North

Humboldt Park North, with its green expanses and recreational opportunities, has seen a consistent increase in property values since 2000. The neighborhood's combination of natural beauty and urban amenities has attracted both residents and investors.

W Cortland St / N Albany Ave

W Cortland St / N Albany Ave is another Chicago neighborhood that has experienced substantial appreciation in property values. Its accessibility to city amenities and transportation options have bolstered its appeal to homebuyers and real estate investors.

These neighborhoods have not only appreciated in property values but also offer various amenities, community vibes, and urban conveniences, making them attractive options for both residents and real estate investors seeking long-term growth and value appreciation in Chicago.