Chicago’s real estate market continues to show resilience even amid rising rates and tightened affordability. According to the Illinois REALTORS® “Market Stats” page, statewide home sales are modestly down compared to previous years, but price levels remain elevated. Illinois REALTORS+2Illinois REALTORS+2

Chicago Market Snapshot — Key Metrics

In the City of Chicago, median prices in August 2025 reflect continued strength. The “City of Chicago” MLS report from Illinois REALTORS® indicates that average prices are holding steady even as some sales volumes soften. Illinois REALTORS Meanwhile, other market watchers note that average days on market are creeping higher, hinting at slightly slower pace compared to peak 2023–2024 periods. saladinosells.homes

Suburban Variations — North Shore, Northwest & Western Suburbs

Suburban markets tend to follow Chicago’s broader trends, but with local flavors. On the North Shore, premium and luxury homes are still commanding attention, especially when they offer modern finishes and proximity to high-performing school districts. In the Northwest suburbs (e.g. Schaumburg, Arlington Heights), buyers often favor more space and newer build — even in tighter financing conditions. In the Western suburbs (such as Elmhurst, Downers Grove), listings close to Metra stations remain competitive, offering a blend of suburban ease and commuter access.

Mortgage Rate Trends and Buyer Impact

Mortgage rates have had some upward pressure recently. Freddie Mac’s 30-year fixed average is around 6.30% as of late September 2025, up slightly from prior weeks. Mortgage Professional America+2Freddie Mac+2 This increment affects buyer budgets significantly: every 0.25% in rate increase can reduce purchasing power. myhome.freddiemac.com

Some reports suggest mortgage rates fell below 7% mid-year, offering temporary relief to buyers. Fox Business That said, the recent upward move suggests continued volatility ahead. Mortgage Professional America

Inventory & Affordability Challenges

One persistent issue across Chicago and suburbs is low inventory. Illinois policy reporting notes that Chicago’s inventory has declined roughly 39% from 2018 levels. Illinois Policy That scarcity supports pricing even when sales volume is modest.

At the same time, rising financing costs strain affordability. The interplay of tight inventory and higher borrowing costs is squeezing some buyers, especially first-time purchasers.

What’s Ahead for the Last Quarter of 2025

Looking forward, several dynamics will matter:

• If rates moderate or trend down, buyer demand could rebound
• Suburban inventory that enters late will be at a premium
• Homes with energy efficiency, modern systems, and turnkey condition will likely stand out
• Pricing strategies and staging will need to be more precise given buyer selectivity