Housing affordability is set to improve as home price growth slows to 1.2%, below inflation, leading to real price declines. Mortgage rates are expected to stay steady at 6.3%, with monthly payments declining 1.9% this year. Existing home sales may rise modestly to 4.1 million, while inventory growth slows to 3.6%. Sellers are adjusting prices realistically, and buyer-seller negotiations are improving market stability.
As someone who has spent over two decades helping families navigate the real estate landscape in the Chicagoland area—especially the Western Suburbs—it's fascinating to see how the nation's housing trends are evolving. Recent data points to the Northeast and Midwest suburbs leading as the hottest U.S. housing markets for 2026. We're seeing a remarkable surge in demand, with inventory levels still 60% below pre-pandemic norms. Homes are consistently selling above asking price, and buyers are coming to the table with larger down payments and stronger credit profiles. My background in banking and commercial real estate has always underscored the importance of recognizing value and quality in a competitive market like this. For families considering a move or a sale, understanding these trends and what drives them is key to making confident, informed decisions.
In June, the US housing affordability index rose to 102.3 as wages outpaced home prices despite median home prices hitting a record high. The average 30-year mortgage rate dropped to 6.49%, easing costs for buyers. The West saw the largest affordability gain, while the Northeast had the smallest. New legislation aims to address housing supply, but relief is expected to take years. Further affordability gains depend on mortgage rates easing.
US existing-home sales slipped 1.7% in Early-Q3 to a 4.06M annual pace, slightly above economists' expectations and still ↑0.7% on a yearly basis.
Median existing-home prices reached a record for Early-Q3 at $434.1K, while the benchmark 30-yr fixed mortgage rate climbed near 7%, highest in >1 yr.
Inventory stayed tight at 1.54M unsold homes in Early-Q3, ↓1.9% MoM and ↓0.6% yearly, leaving a 4.6-mo supply at current sales pace.
An economist said owners with ultra-low pandemic-era mortgages had little incentive to sell, helping keep listings scarce and limiting how many buyers completed purchases.
First-time buyers made up 29% of purchases in Early-Q3, down from Late-Q2 and still below the historical norm of ~40% of sales.
DuPage County residents with storm damage or losses from July 2-4 could apply for low-interest recovery loans through a federal agency program.
The disaster declaration covered DuPage County, opening eligibility for homeowners, renters, businesses, and some nonprofits seeking help after recent storm-related damage and losses.
These loans were meant to help cover recovery costs not otherwise paid by insurance or other sources, giving affected applicants another funding path.
For DuPage County applicants, the program focused on losses tied to the July 2-4 storms, keeping assistance targeted to that damage event.
If insurance did not cover every expense, eligible DuPage County applicants could seek low-interest loan support through this program for uncovered storm recovery costs.
Federal housing policy long favored cheaper financing, but the new law signaled a shift toward easing construction, streamlining reviews, and supporting more homebuilding.
The core issue was supply: when too few homes exist where demand is strongest, limiting certain buyers can change ownership, but not create homes.
The law's most consequential steps encouraged manufactured housing, rewarded communities that build more homes, and reduced barriers that can make new construction slow or costly.
The analysis found cheaper mortgage credit tends to increase borrowing and lift house prices more than homeownership, especially where zoning and permitting constrain building.
Congress began bridging competing priorities, but the central takeaway remained clear: expanding housing supply, not subsidizing every bidder, offers the stronger affordability path.
For those in Kane and DuPage counties, as well as three other nearby areas, there’s some relief available if your property was impacted by the July storms. The SBA is now offering low-interest loans for homeowners, renters, businesses, and certain nonprofits to help cover expenses that insurance might not address. Having worked in real estate and banking throughout Chicagoland for over two decades, I know how critical it is to have timely support when unexpected damage occurs. Understanding the financial side of homeownership and property value is central to making smart decisions, especially during times like these.
