Before the onset of the war in Iran, Alonzo Abron Jr., managing broker and owner of Oak Forest-based A. Progeny Global, held optimistic expectations for the housing market in 2026. Now, uncertainty dominates the scene, haunting real estate professionals amidst the rising living costs and interest rates since the war’s emergence.
Abron, who represents buyers and sellers in the south suburbs and has previously chaired the Global Real Estate Council with the Chicago Association of Realtors, expressed, Before the war, I anticipated people would be in a better financial situation than they are now.
Rising gas costs, increased living expenses, and job losses all impact this outlook.
Lutalo McGee, president of the Chicago Association of Realtors and owner of Chicago-based Ani Real Estate, noted that sellers might capitalize on rising home prices by listing their homes. McGee expects homeowners who locked in low mortgage rates during COVID-19 might reconsider selling. Global events contribute to uncertainty and inflation, although their exact impact remains unclear.
Geoff Smith, executive director of the Institute for Housing Studies at DePaul University, described the housing market throughout the Chicago metropolitan area as challenging and complex. Inventory in the Chicago area and statewide remains tight, with Illinois reflecting one of the country’s slowest inventory recovery levels compared to pre-pandemic levels.
Andretta Robinson, a broker and team lead of the Titan Group at Re/Max 10 in Oak Lawn, has observed increased inventory of homes entering the market in the south suburbs below $300,000. However, many of these are distressed properties needing updates or aren’t move-in ready. Across the metropolitan area, fluctuations in inventory and sales activity exist but are not sustained amidst economic volatility.
Smith explained that inflationary pressures impact housing costs, the construction of new housing, and improvements to existing housing, which affects affordability.
The zigzagging mortgage interest rates have challenged home shoppers’ purchasing power. The average 30-year fixed-rate mortgage rate averaged 6.51% last week, up from 6.36% a week earlier, while the 15-year fixed-rate averaged 5.85%, up from 5.71%, according to Freddie Mac.
Abron’s experience illustrates how fluctuating rates can affect buyers. An individual considering a $250,000 home can now only afford a $200,000 property amid these shifts.
The Illinois Housing Market forecast from DePaul’s Institute for Housing Studies revealed a 0.3% annual decline in closed single-family home sales in the Chicago metropolitan area in April, despite a near 5% price increase. Statewide sales were 0.5% lower, with prices rising 7.4%. The Institute’s forecast projected a 5.1% rise in sales of single-family homes, townhomes, and condominiums by 2026, with a projected price increase of 5%. Illinois sales were forecast to grow by about 1%, with a 3.4% price increase.
In Cook County, house prices rose 4% year-over-year with only the Calumet City/Harvey submarket seeing a 1.2% decline. Prices in submarkets like Oak Lawn/Blue Island, Orland Park/Lemont, Chicago Heights/Park Forest, and Oak Forest/Tinley Park varied from 3% to 5.2% increases.
Despite challenges, Abron noted the advantages of buying a home in the south suburbs, including affordability, land availability for development, and proximity to transport links. However, higher property taxes remain a disadvantage.
When asked about purchasing now, Abron emphasized the absence of a crystal ball, suggesting that decisions depend on personal desires and capabilities. The market remains competitive due to inventory shortages.
Abron shared an instance of a seller receiving an offer the day after listing a house. Similar scenarios occurred for Matteson resident Michele Andrews, who downsized after her husband’s death. Her open house drew 65 people, resulting in 10 offers.
Joni Bradley-Scott, a real estate agent with Keller Williams Preferred Realty and Andrews’ daughter, reflected on enduring housing market influences despite tumultuous world events. Individuals still face changes such as marriage, divorce, and childbirth, necessitating housing decisions.
Bradley-Scott stressed the importance of communication in these uncertain times, aiming to foster understanding and enable clients to embrace ongoing changes to achieve the best outcomes for their situations.