Fewer homes on market, higher prices for Illinois buyers

Elevated prices thanks to low inventory continued to create problems for Illinois homebuyers in November.

Buying a home in Illinois costs a lot more than it did just six years ago.

In just one year, Illinois Realtors reports home sales decreased by 9% but prices increased by nearly 5% between November 2024 and November 2025.

That price increase shoots up to 49.5% when looking at the past eight years. A typical Illinois home was valued at $187,874 in November 2018, according to Zillow’s Home Value Index, which tracks the price of similar homes over time. Today, that same home would cost $278,351.

That’s a jump of more than $92,000 for the same house, meaning significantly higher mortgage payments and down payments for Illinois families trying to buy a home.

The price increases have hit communities unevenly. Some cities have seen their home values nearly double.

Sauk Village leads with a 163.2% increase. Harvey has seen a 113.6% increase. Even in cities with modest growth such as Arlington Heights, where prices have only increased 39.9%, homebuyers might be feeling the challenges.

One major reason Illinois homes cost so much more is simple: there just aren’t enough of them available to buy.

Zillow’s data shows all 26 Illinois metro areas that it tracks have seen housing inventory shrink since March 2018. Only Carbondale has roughly the same amount of housing inventory compared to 2018.

Chicago’s story is typical. The city had 38,581 homes available for purchase in 2018. This year, that number dropped to just 22,977 – a decline of 40%. That means buyers in Chicago are competing for 15,604 fewer homes than six years ago. When you have the same number of people looking to buy but far fewer homes on the market, prices inevitably climb.

Even year over year, Illinois Realtors reported the Chicago metro area saw 10.5% fewer homes sold in November 2025 compared to November 2024.

Chicago isn’t the worst. Thirteen Illinois metro areas have experienced even steeper drops in available housing than the state’s largest city. Bloomington leads with a 71% drop.

The inventory problem becomes even clearer when comparing Illinois to the rest of the country.

According to Realtor.com, Illinois currently has just 41% of the active housing listings it had before the pandemic. The national average sits at 88% – more than twice Illinois’ rate.

Illinois is recovering far more slowly than most other states when it comes to getting homes back on the market.

The obvious solution would be to build more homes. But construction data shows Illinois metros are still building at disappointingly low rates, failing to keep pace with demand or make up for the shortage.

Illinois’ housing shortage isn’t an accident. It’s largely the result of policy choices that make it harder to build new homes.

Restrictive zoning laws across the state prevent developers from building the types of housing that could ease the shortage. At the same time, Illinois’ property taxes are the highest in the nation and eat into the money residents have available to spend on housing.

Communities could take several concrete steps to make housing development easier. One option is legalizing what planners call “light-touch density,” which is allowing buildings with eight to 10 units in busy areas where demand is high.

Parking requirements represent another unnecessary barrier. Many cities require developers to build expensive parking spaces even in areas near public transit where residents might not need cars. Chicago has recently started reducing these requirements, freeing up more space for actual housing.

Accessory dwelling units, which are sometimes called “granny flats” or “in-law suites,” offer another solution. These small additional homes on existing properties can house older residents who want to downsize while staying in their neighborhood, or young professionals just starting their careers. Legalizing these units statewide would add housing options without dramatically changing neighborhood character.

Cities could reduce the land they require for a single-family home, which experts estimate could lead to the state building 10,000 more units each year.

But even with these zoning reforms, Illinois families face another challenge: keeping their homes once they buy them.

Illinois’ property taxes remain the highest in the country, straining household budgets year after year. A family who manages to scrape together enough for a down payment and monthly mortgage could still lose their home to property tax bills they can’t afford.

Solving Illinois’ housing crisis will require tackling both problems at once. Zoning reform can create more housing supply and bring prices down. But without property tax relief and broader budget reform, many Illinois families will struggle to afford homes no matter how many get built.