2026 Chicagoland real estate sales predictions

by Chicago Agent

December 01, 2025

Featuring the perspectives of:

Jennifer Ames and Karen Arenson
Private Office Advisor and License Partner, Engel & Völkers Chicago

Melissa Archer-Wirtz
CEO, CENTURY 21 Circle

Steve Baird
President and CEO, Baird & Warner

David Bracy
Vice President and Designated Managing Broker, Berkshire Hathaway HomeServices Chicago

Fran Broude
Regional Vice President, Compass

Janice Corley
Chairman and CEO, RE/MAX Premier

How do you think buyer and seller expectations will evolve in 2026 compared to what we’ve seen over the past few years?

Jennifer Ames and Karen Arenson: In 2026, buyer and seller expectations are likely to shift in response to a calmer but still supply-constrained market. By 2026, many buyers will expect slightly improved affordability as rates ease, and most will have accepted that the ultra-low 2% to 5% rates are not returning. As a result, they will enter the market with more realistic financing expectations and a willingness to act decisively when the right home appears.

Seller expectations will evolve differently. While buyers will hope for greater affordability, sellers will continue to expect strong pricing because inventory remains the defining challenge. Unless supply increases meaningfully, sellers will anticipate continued upward pressure on prices and, in some areas, competitive conditions like what we have seen in recent years.

Melissa Archer-Wirtz: Buyers are tired — not just of high rates, but of constantly shifting headlines. With home prices expected to rise by about 1% next year and mortgage rates likely holding around 6%, we’re entering a calmer, more predictable market. … Sellers who expect last year’s bidding wars will need to adjust, and buyers will need patience and a clear plan. It’s a ‘back to basics’ market — one where realistic expectations, solid data and good advice matter more than ever.

Steve Baird: Buyers will likely enter 2026 expecting interest rates to drop sharply, but we foresee more gradual improvements that will still enhance purchasing power. With more attractive rates and slightly more inventory, opportunities will increase for buyers who are ready to act decisively. At the same time, sellers will continue to achieve strong prices. Market appreciation has leveled off in some areas but remains solid across desirable locations where inventory is tight.

David Bracy: Buyers will expect more negotiation room and value-driven pricing. The first 30 days will remain critical for sellers to capture strong offers… but only if priced correctly. This said, sellers should continue to expect strong returns, again, only if a property is well-positioned within the market.

In the last couple of years, sellers have been listing their homes at elevated prices while trying to skip out on making improvements. But buyers are getting more selective — they’re tired of overpaying for homes that are just ‘OK.’ Though our spring markets are usually a catalyst for accelerated pricing and multiple offers, I believe buyers will continue to be more selective in 2026 and less likely to just accept properties in any condition.

Fran Broude: Buyers who’ve been on the sidelines may feel more confident if rates continue to ease, giving them increased purchasing power and more negotiating leverage in city markets where prices have softened. At the same time, sellers in suburban and luxury markets, where inventory remains tight, will likely continue to hold firm on pricing.

Janice Corley: The expectations of buyers and sellers will increase in terms of customer satisfaction. Buyers and sellers will expect one-stop shopping and all the answers to come through the services of their agent. Response time must be immediate and provide as much information as possible to the clients. Buyers want a turnkey property at the right price. Sellers want direction from agents on what it will take to get the property sold in the shortest amount of time.

What role do you see AI, data analytics and emerging tech playing in how agents serve clients and run their businesses by 2026?

Ames and Arenson: AI and data analytics will automate the administrative and data-heavy tasks that traditionally consume an agent’s time. This will allow agents to scale their high-touch services and increase the amount of time they spend on client relationships, negotiation strategy, and market interpretation. Agents will rely on advanced analytics to forecast trends, identify opportunities for buyers and sellers, and create highly tailored marketing strategies.

Archer-Wirtz: AI has moved from novelty to necessity. Advanced CRMs and machine-learning tools now help agents predict where demand is shifting and tailor pricing strategies with greater precision. As HousingWire noted earlier this year, agents who lean into real-time analytics are outperforming their peers. But the differentiator isn’t the tech itself — it’s how you use it. The best agents pair data with empathy, letting automation handle speed and scale while they focus on insight, trust and timing — the human elements technology can’t replicate.

Baird: Advances in AI and data analytics are helping agents and consumers digest information more easily, analyze market trends more effectively and make smarter decisions faster. We see technology as an enabler, not a replacement, for the relationships our agents build every day.

Bracy: AI and data analytics are becoming essential to agent success and leading to an industry-wide increase in professionalism. They will help brokers develop better messaging, clearer communication, drive efficiency, enhance client experience and reinforce strategic value. Technology will streamline client processes, reporting and enable predictive insights into hyperlocal trends such as days on market and seasonal pricing. Additionally, AI will automate prospecting, lead generation and social media content creation. All of these efficiencies, when used well, will allow agents more time for ‘human’ interaction which is paramount in this business.

Broude: Agents are relying more than ever on real-time data and technology that saves time and money so they can focus on what matters most: serving their clients.

Corley: AI can be used to assist with data for the agent to service the client. AI is not able here to replace the agent.

What steps will the industry need to take in 2026 to strengthen consumer trust and reinforce the value of Realtor representation?

Ames and Arenson: In 2026, the industry will need to take several deliberate steps to strengthen consumer trust and reinforce the value of realtor representation. The newly released mission of the National Association of Realtors highlights three areas that will be essential: Transparency and Accountability, Data-Driven Specialty, and Modernized Operations. …Collectively, these steps will help the industry reestablish trust and highlight the meaningful role that professional representation continues to play in a changing real estate landscape.

Archer-Wirtz: The industry has to reclaim the narrative through education, transparency and consistency. After years defined by lawsuits and headlines, consumers are craving clarity — not spin. Rebuilding trust means leading with facts: what a home is truly worth, how a 6% rate fits into long-term affordability, and what clients should expect at every step. … It’s reported that nearly nine out of 10 consumers still choose an agent, but that trust has to be earned every day. Acting like experts — not salespeople — is how we protect both the transaction and our reputation.

Baird: We predict the real estate practitioner who handles only occasional transactions is becoming a thing of the past. Today’s market demands full-time, strategic agents who can navigate challenges, anticipate changes and deliver real value that justifies their commissions. The industry will continue to evolve toward a smaller but stronger group of professionals who are fully invested in their clients’ success.

Bracy: Our industry needs to maintain accountability for the consumer experience by enforcing the consistent use of representation agreements on all transactions. Real estate organizations need to take time to explore the right avenues to better explain changes in our industry to consumers. To build trust, the industry must educate consumers, share transparent local data and use technology to support — not replace — human insight.

Broude: In 2026, we’ll need to double down on transparency, education and data-driven communication. Agents should be equipped to explain what’s really happening in their hyperlocal markets, whether it’s why a certain condo building is adjusting pricing or why a suburban neighborhood is holding firm. The more we help consumers understand these dynamics, the more they’ll trust the value we bring.

Corley: The steps I believe the real estate community can take toward gaining more trust from consumers is to work with a high concentration on customer service, technology and providing as much information as possible for a transaction.

Do you anticipate more demand in the city or in surrounding suburbs? Why?

Ames and Arenson: In 2026, demand is likely to remain strong in both the city and the surrounding suburbs, but for different reasons. Families will continue to prioritize move-in-ready homes in high-performing school districts and near public transportation. Many buyers have outgrown their starter condos and do not have the time or desire to renovate, so they will be willing to pay a premium for turnkey properties. Financial support from parents or grandparents will play a growing role in making these moves possible.

Archer-Wirtz: The suburbs will continue to lead the story in 2026. Affordability pressures, coupled with a desire for space and stability, are pushing buyers toward areas that balance convenience and cost. We’re seeing more energy in suburban downtowns and secondary markets that offer the lifestyle of the city without the financial strain. Chicago’s core neighborhoods will always have appeal, but the majority of movement — especially among first-time and move-up buyers — is happening where they can get more for their money and still stay connected to the metro core.

Baird: We expect demand to stay consistent with what we have seen over the past few years. The reality is that inventory remains the driving force. Some city neighborhoods have more available homes, while others continue to experience tight supply. Suburban markets are facing similar dynamics. Communities with good schools, vibrant downtowns and convenient train access into the city continue to perform exceptionally well as buyers balance lifestyle and commute considerations.

Bracy: I anticipate more demand for buying homes due to younger millennials and Gen Z population growth who have less inventory of modern rental buildings with attractive amenities from which to choose. The more rental prices increase and interest rates decline, renters will consider buying a better option. Suburban communities along the commuter train lines are seeing strong buyer interest and continued price appreciation. These areas offer lifestyle appeal, highly ranked schools, parks and hybrid-work flexibility. While urban markets may regain some traction, suburbs with city-like amenities, boutique shops and restaurants will continue to perform well.

Broude: The city and urban condo markets have seen some price softening, which could attract more buyers back into those areas in 2026, especially as affordability improves. There’s real opportunity for value there. The suburban market remains very viable, with minimal price reductions and strong buyer interest, particularly from families or remote workers who prioritize space and schools. The luxury market, meanwhile, continues to be a bright spot across the board, driven by stable inventory and high demand.

Corley: I anticipate a balanced level of buyers going to the ‘burbs and ‘burbs and empty-nesters coming to the city. There will be an increase of empty-nesters who are interested in living in a condo with a one-level lifestyle in the city. There’s not enough product in the ‘burbs to supply this demand in the ‘burbs.

What are your expectations for inventory levels in 2026 compared to what we’ve seen this year?

Ames and Arenson: In 2026, we expect inventory levels to rise compared to this year. Older homeowners will begin to accept that interest rates are likely to remain higher than the historic lows of the past decade and will prioritize their health, lifestyle needs, and overall quality of life rather than stay in homes that no longer suit them. This shift will allow long-delayed move-up buyers to make transitions they have postponed, increasing the number of available homes across multiple price points.

Archer-Wirtz: Inventory will likely stay constrained. Nearly two-thirds of homeowners are holding mortgages under 4% — a powerful disincentive to move. When uncertainty rises, people stay put, and that inertia won’t unwind overnight. Even as rates normalize, sellers will hesitate to trade low payments for higher ones. In some Florida and Sun Belt markets, rising insurance costs and relocation patterns may release a bit of inventory, but across the Midwest, supply will stay tight.

Baird: After several years of historically low sales, there is a clear sense of pent-up demand in the market. As interest rates improve, more homeowners are going to feel confident about listing their properties and making a move. We are already seeing early signs of this. Pricing stabilization this fall has modestly increased available inventory, positioning us in a much better place heading into 2026 than we were a year ago.

Bracy: Over the past year, we have seen inventory levels come down from the previous year, unlike other parts of the country. Our spring market will likely bring more sellers and buyers to the table, rising moderately with local variability with some towns seeing slower absorption due to price softening. I do believe we will see a strong spring market based on the current number of conversations our brokers are having right now with sellers preparing to take advantage of the optimal selling season and projected lower mortgage rates, which will help to drive affordability. All indicators show us moving into a ‘normal’ market.

Broude: I’d expect a modest increase in active listings, maybe in that 5% to 10% range, as more homeowners with low-rate mortgages decide to move and builders finish projects that were delayed. That said, I don’t see a dramatic shift. The market will likely remain competitive, and inventory will continue to feel limited in most high-demand suburbs. The real story is how uneven that growth will be — some parts of the city may feel a lot more balanced, while others, especially the luxury tier, will continue to move quickly with tight supply and strong demand.

Corley: I believe inventory will increase in 2026. We are expecting lower interest rates, which will drive the sellers to list their properties and buy something else.