At the beginning of 2026, much of the housing market remains in a holding pattern from 2024. Interest rates have decreased slightly and inventory’s gone up, but prices remain relatively high, and the time homes spend on the market has increased in many locations.

While more new homes were built than in other post-pandemic years, construction became more expensive due to a combination of increased materials prices, supply chain breakdowns and the rising cost of labor. The 43-day government shutdown played a role in disrupting markets, as well.

Nationally, 4.13 million homes were sold in November, a 1% year-over-year decrease from 2024, according to the National Association of REALTORS®. The number of homes for sale was 1.43 million, up 7.5% from 2024, and the median sales price rose 1.2% year over year to $404,400.

Selma Hepp, senior vice president and chief economist at Cotality, characterized the 2025 housing market as one that “could be defined by resiliency,” but also by “significant headwinds” that included slowing consumer confidence, the impact of tariffs, fears of recession, elevated mortgage rates and worries about the job market. 

“The other thing that happened in 2025 that was maybe to the advantage of potential homebuyers was that we did see more inventory,” Hepp said. “Because of the increased inventory, that eased pressure on home prices, and because of that, home-price appreciation cooled significantly over the course of the year, and it’s only at about 1.2% at the moment. So, a swing from a very bustling market that we saw during the pandemic.” 

Chris Lim, chief growth officer at RE/MAX, referred to the 2025 market in the Chicagoland area as a “story of recalibration” after the interest rate increases and scarcity of recent years. To him, 2025 was a “clarifying” year. 

“I think that the market has kind of settled into a new, understandable rhythm,” he said. “I think we’re seeing mortgage rates start to come down from their highs and inventory starting to return, and I think that for buyers and sellers, the rationality which had somewhat escaped us has returned. While it wasn’t an exuberant year, I would classify it as a very clarifying year.” 

North Shore-Barrington Association of REALTORS® CEO Jeff Lasky sees reason for optimism in the 2025 market. Prices were still growing in Chicagoland, but not at the frenetic pace of previous years. He pointed out that NAR’s 2025 Profile of Home Buyers and Sellers showed that the number of first-time homebuyers fell to a historic low of 21%, while the typical age of a first-time buyer was 40, a sign that buyers took longer to save for their down payment than in previous years. 

“Construction starts have been low, so inventory has been pinched,” he said. “But we’re starting to see a little bit of an improvement. That’s something I’ve been keeping an eye on, as well as days on the market. The days of putting a house for sale on the market and it’s sold — that’s long gone. You’re not going to get 15 offers to choose from, but all the brokers we’re talking to and the metrics we’re seeing say it’s still a busy market. It’s just more reasonable.” 

Expectations for the 2026 market 

Hepp expects 2026 to be a “recovery year” from the low volumes of the last couple years, but not significantly better than where the market was before. 

“I would really describe it more as a gradual normalization than as some dramatic recovery or correction,” she said. “When you look at both forecasts for home sales and home prices, it is very slow improvement in the lower single digits for home prices and middle single digits for home sales. Slow, but gradually improving.” 

To Lasky, 2026 feels “like a bridge to an even better real estate world” characterized by moderate price growth. 

“We’re going to have growth and opportunities that are going to feel kind of new because we haven’t had them for a few years,” he said. “For decades, especially in new-member education classes, brokers have asked me what the secret to success in real estate is, and I’ve always said one word: ‘perseverance.’ So, I’m going to have to stay with it. The single greatest factor for success I’ve observed in all my years is length of time in the business. I think that those that can and do stay with it are going to reap the benefits that are soon to come.” 

Lim said that if 2025 was the year in which housing recentered itself, 2026 will be “the year that differentiates” the meaning of “home” for buyers. 

“It’s not going to be a question of whether someone can buy a home, but what kind of home and what kind of features,” he said. “I think that’s really the difference. We’re seeing these trends where people are focused on the quality of life, they’re focused on the walkability of the community. They’re focused on the design features.” 

Adjusting to the ruling 

In the year since the NAR commission settlement, Lim has viewed real estate landscape through three lenses: as a RE/MAX executive, as a practicing RE/MAX agent and as an individual interested in networks. 

“What I’m seeing firsthand is that good agents adapt,” Lim said, explaining that RE/MAX as a network provided agents and brokers with guidance and material to help them adjust. 

“In August 2024, when that ruling went into place and it became effective, I think there was a lot of concern and consternation,” Lim said. “I think one of the beauties of being part of the RE/MAX network is we really came together to educate and to help and to be there as a level of support. But in most areas, it’s been a nonissue.” 

Lasky’s association was able to prepare for the post-settlement changes well in advance, creating and delivering buyer-agent agreement training for members. 

“We continue to make that available, but there are other things that go along with that,” Lasky said. “The local associations are the conduit for information, from the [NAR] and from Illinois REALTORS®. We remain that conduit for members … Our contracts and forms remain valuable to members. … Obviously, we addressed those changes very quickly and made sure that our forms and contracts were suitable.” 

New tech in 2026 

Finding success in the new year likely will include embracing new technology tools, such as advanced micro-market analytics that mine consumer information. 

“We have enough data, and with enough data you can almost predict behavior on the nose,” NASBAR’s Lasky said. “I think we’re going to see improvements, augmentation to these property tours that are going to give people an even easier time to continue to shop for properties without necessarily having to go there right off the bat. It’s all AI-driven.” 

Lasky also touted AI as a way for agents to grow their networks in 2026. 

“There are so many ways that agents and brokers get leads, but the quality of the leads is an issue,” Lasky said. “Now, because of AI, and the algorithms out there, you’re going to get better-quality leads. Along with that, there’s all sorts of functionality which allows for automated follow-up with your connection.” 

Lim said RE/MAX is setting agents up for success in the new year by launching initiatives focusing on artificial intelligence, particularly generative AI, to provide highly qualified leads to their network. Agents who embrace the technology and use it to enlarge their networks will be positioned to do well. 

“I think the discussion has always been AI versus an agent,” Lim said. “AI operates at a level that really wasn’t possible before. We’re seeing that RE/MAX agents, with the use of the AI that we have, are more informed, they’re more strategic and they’re more focused. The part of the transaction they’re focused on is the part that can’t be replaced by technology. That’s the huge difference.” 

Looking ahead 

Hepp offered cautious optimism for 2026, based on a combination of data points — such as how many listings are being discounted and the months’ supply of available homes — to capture the balance between inventory and demand. 

“There are affordability challenges that will persist,” Hepp said. “But we have seen improvements. Wage growth is now outpacing home-price appreciation. We have more inventory. Rates are going to continue that gradual decline, so there are emerging opportunities that potential buyers can see in that moment. There is also some upside potential due to some tax changes. The SALT deduction increases next year, so that makes the homeownership calculation a little bit more favorable versus continuing to be a renter.” 

Lasky emphasized that the market is in a state of transition. While volume has slowed, brokers remain busy. 

“Maybe a non-frenetic, non-crazy market is better,” Lasky said. “I would advise every agent, every broker I see to sharpen up. Prepare your niche and your targeted markets. Improve your expertise in those areas. And I would tell them this is a good time to keep your eye on costs. Make sure that you’re being really careful about that until things start really happening.” 

EXPERT SOURCES

Selma Hepp, senior vice president and chief economist, Cotality

Jeff Lasky, CEO, North Shore-Barrington Association of REALTORS® 

Chris Lim, chief growth officer, RE/MAX