As we approach 2025, the Chicago housing market is expected to remain competitive but with some key shifts that both buyers and sellers should keep in mind.

1. Mortgage Rates: The consensus among experts is that mortgage rates will decrease slightly in 2025 as inflation continues to ease and the Federal Reserve may cut interest rates further. This drop in rates will make homes more affordable, which could draw more buyers into the market
2. Home Prices: While home prices are still expected to rise, the increase will be moderate compared to previous years. Experts project a growth rate of about 2.6% nationally, but it may be slightly higher in cities like Chicago, where demand remains high. In 2024, Chicago saw higher-than-average price growth, but with increased supply expected in 2025, the growth rate will stabilize​
3. Inventory Levels: One of the main challenges for the Chicago market has been low housing inventory. However, 2025 may see an uptick in available homes as mortgage rates decline and more sellers feel comfortable listing their properties. New construction is also expected to increase slightly, particularly in multifamily housing​
4. Competition: The decreased mortgage rates and moderate price increases could lead to heightened competition among buyers. While some relief is expected, the market will likely remain challenging for first-time buyers and those looking for affordable housing​

In summary, while Chicago’s housing market will continue to present challenges in 2025, particularly in terms of affordability and inventory, buyers can expect more favorable conditions compared to the last few years. With strategic planning, both buyers and sellers can benefit from the evolving market dynamics.

data from ​Camille Canales Group​ Norada Real Estate Investments​Business Insider.