The Chicago Housing Market

2025 in Review — What It Means for 2026**

Chicago has never been a single housing market. It is a city of micro-markets, shaped by zoning, housing stock, transit access, and neighborhood momentum. In 2025, those differences became even more pronounced.

What follows is a clear look back at 2025, a neighborhood-by-neighborhood lens on where demand is concentrating, and what buyers, sellers, and investors should realistically expect in 2026.

📊 2025: A Market Defined by Scarcity, Not Weakness

The dominant story of 2025 was high prices paired with low sales volume—a market constrained not by demand, but by supply.

• Median Chicago Sale Price: $364,099
  Prices continued to rise, though still below the national median.
• Low Inventory & Sales Volume:
  Monthly sales averaged roughly 6,300 transactions, held back by a lack of listings rather than buyer interest.
• Year-End Momentum:
  December saw the strongest pace of existing-home sales in nearly three years, signaling pent-up demand finally releasing.
• Seller’s Market Conditions:
  With just 3.1 months of supply, Chicago remained firmly seller-leaning. Average market time hovered around 54 days, though this varied sharply by neighborhood.

The takeaway: Chicago never cooled— it compressed.

📍 Neighborhood Performance: Where the Market Diverged

West Loop & Fulton Market

These neighborhoods continue to behave like global urban markets, not just Chicago neighborhoods.

• Demand remains strongest for newer condos, boutique buildings, and townhomes
• Buyers are heavily motivated by walkability, dining, proximity to offices, and lifestyle amenities
• Inventory remains tight due to zoning limitations and high construction costs

Outlook: Prices remain resilient. Well-designed, well-located properties still sell quickly; mediocre product does not.

South Loop

South Loop quietly reasserted itself in 2025.

• A broad mix of condos at multiple price points
• Strong appeal to professionals seeking space, transit access, and value relative to West Loop
• Steady absorption of inventory, particularly near the lake and transit corridors

Outlook: Stable appreciation and renewed interest from buyers priced out of River North and West Loop.

Bronzeville

Bronzeville remains one of Chicago’s most watched neighborhoods.

• Strong single-family home demand
• Growing interest from buyers seeking historic housing stock and long-term upside
• Limited new construction keeps inventory constrained

Outlook: Long-term appreciation potential remains strong, particularly for renovated single-family homes and well-located multi-units.

United Center Area

Development momentum continues to reshape this area.

• New mixed-use and residential development driving attention
• Investors and owner-occupants watching closely
• Pricing still offers relative value compared to adjacent West Loop

Outlook: Transitional neighborhood with upside, especially as infrastructure and commercial investment continues.

Avondale & Old Irving

These neighborhoods benefit from a rare combination: transit access, traditional housing stock, and relative affordability.

• Strong demand for single-family homes and 2-flats
• Buyers include first-time homeowners, move-up buyers, and investors
• Limited new inventory preserves pricing pressure

Outlook: Consistent, steady growth rather than volatility. These remain “quiet winners.”

Pilsen

Pilsen continues to reflect Chicago’s housing tension.

• Strong demand driven by location and culture
• High concentration of 2-4 unit buildings
• Declining supply of entry-level multi-units citywide

Outlook: Values remain supported, but affordability pressures persist. Ownership opportunities are increasingly scarce.

Bridgeport & McKinley Park

These neighborhoods remain among the city’s most balanced markets.

• Strong owner-occupant presence
• Mix of single-family homes, condos, and multi-units
• Stable pricing without speculative swings

Outlook: Excellent long-term stability for homeowners and investors alike.

Garfield Ridge

Garfield Ridge continues to attract value-focused buyers.

• Predominantly single-family housing stock
• Strong appeal to buyers prioritizing space and affordability
• Less speculative pressure than trend-driven neighborhoods

Outlook: Steady, fundamentals-driven appreciation.

🏡 Suburban Spotlight: Naperville as a Case Study

The suburbs are not uniform—and Naperville illustrates why.

• Median Price: $665,000 (↑ 11% year-over-year)
• Market Time: ~44 days
• Roughly half of homes sold above asking, but with more price adjustments than in peak years

Takeaway: Competitive, but rational. Buyers are selective, not desperate.

🔮 2026 Outlook: A Gradual Reset, Not a Crash

Chicago enters 2026 positioned for a measured recalibration, not a downturn.

• Projected Sales Increase: ~5%
• Projected Median Price: ~$387,000
• Mortgage Rates: Expected to stabilize in the low-to-mid 6% range
• Inventory: Slowly rising, but still historically tight

The biggest constraint remains rate lock-in. Many homeowners with sub-4% mortgages are staying put, limiting supply.

Key 2026 Neighborhood Trends

• High-Demand, Walkable Areas (West Loop, Fulton Market, Old Town-adjacent neighborhoods) remain competitive
• Buyers Are Sharper: Pricing, presentation, and condition matter more than ever
• Luxury & Upper-Middle Markets ($1M–$3M) remain strong, driven by buyers less sensitive to rates
• Overpriced Listings Will Sit: The market will no longer correct seller mistakes

💡 Strategic Takeaways

For Buyers

Preparation wins. Pre-approval, clarity, and decisiveness matter more than timing interest rates.

For Sellers

Pricing accuracy and marketing quality are essential. The market will not save an overpriced listing.

For Homeowners & Investors

Chicago real estate—particularly in supply-constrained neighborhoods—remains a durable long-term asset. Understanding neighborhood-level housing composition is the key to predicting stability and growth.

Century 21 SGR Research Department