Chicago Real Estate: Affordability and Opportunity in a Competitive Market

Written by:

Steve Marcinuk

Date:

09 Apr 2026

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Scott Newman, a veteran Chicago broker with nearly two decades of experience and team leader at Team Newman powered by KW ONEChicago, has seen the city’s housing landscape from every angle. Beginning his career at Coldwell Banker in 2005 as the market headed into a downturn, Newman built his expertise during the foreclosure crisis, gaining experience in both high-end and distressed properties.

“I might show a $3 million home and then drive ten miles to sell a $75,000 REO property,” Newman says. This range has given him a unique perspective on Chicago’s varied market.

Chicago’s Affordability Edge

Unlike San Francisco, New York, or Miami, Chicago maintains a balance between big-city living and attainable homeownership. Newman argues that Chicago matches other global cities in culture, food, and architecture, but at a fraction of the cost. “Multiple cities in California, South Beach, New York, anywhere around DC — homes are insane,” he says. “Chicago is absolutely on par with a world-class city.”

Still, affordability is relative. Recent estimates from experts suggest a family of four needs a staggering $244,000 a year to live comfortably in Chicago without financial strain — a figure drawn from a GoBankingRates study analyzing cost-of-living data across major U.S. cities. This figure shocked even Newman when he first saw it and highlights that even in more affordable metros, the gap between wages and housing costs persists.

“Chicago absolutely must figure out how to effectively provide affordable housing throughout the city to continue to grow,” Newman adds.

“Chicago is a city of two extremes,and we all need to work together to close that gap” Newman observes. “We have a large population of Chicagoans earning significantly less than that figure, and continue to be affected by the high cost of living increases on top of rising real estate prices.  They also deserve housing options that work for them. Progress needs to include opportunities for everyone, regardless of household earnings”.

Demand Surges Across Chicago

Despite national economic uncertainty, Chicago’s real estate market is defying expectations. Newman describes the spring 2026 market as “white hot,” particularly in the suburbs, where homes routinely draw offers 15% or more above list price. Many buyers are waiving appraisals and offering additional concessions to secure properties.

The city’s condo market, which lagged during the pandemic, has rebounded. Newman reports multiple offers on a large share of condo listings across all price points. This is a marked change from recent years, when downtown condos were difficult to sell. This renewed interest reflects growing buyer confidence in urban living and in Chicago’s long-term potential.

New construction commands a premium, as buyers are willing to pay more for modern amenities and energy efficiency. Competition extends across all price ranges, from entry-level condos to high-end properties.

Investment Strategies Gaining Traction

For investors, Chicago offers opportunities rarely found in other major cities. Newman points to house hacking — buying two-to-four-unit properties and living in one unit while renting the others — as the strongest path to building wealth locally. FHA loan limits now exceed $1 million for four-unit properties, with down payments as low as 3.5%, bringing these investments within reach for more buyers.

Newman recently purchased a new construction three-unit building in North Lawndale. The two rental units cover the entire mortgage payment, making the property cash-flow positive from day one. Newman notes that, while his was from another source, more than a dozen other lots for similar new construction projects were acquired through the Chicago Land Bank. The area is benefiting from the multi-billion-dollar United Center development, which is creating new interest in and opportunities for surrounding neighborhoods through new retail, residential, and commercial, community-minded projects.

Bronzeville is another area experiencing rapid growth right now, thanks to its historic architecture, exceptional cultural opportunities, and convenient access to the lake and highways. South Shore has also seen strong growth, and the opening of the Obama Library in Woodlawn is boosting demand in surrounding neighborhoods. With 77 distinct neighborhoods, there are incredible opportunities throughout the entire city.

“We work all over Chicago in the capacity of regular Agents as well as representing financial institutions for REO and other distressed transactions,” Newman says. Working throughout the city across different asset types, price points, and conditions has given him a unique perspective, rooted in a deep understanding of the fundamentals that make up the complex local market and countless hours spent gaining perspective from all the amazing people who call this city home.

Technology Reshapes Team Operations

The real estate industry is changing how top teams operate. Newman has shifted from managing a team of over 20 agents to running a boutique operation focused on building exceptional relationships and providing an unequaled level of personalized attention and results. Effectively leveraging technology, automation, and AI has enabled Newman to handpick a select few highly skilled and talented individuals who make up the heart and soul of his team, which keeps the focus of everything they do on the client.

“Instead of spending 53 cents of every dollar on overhead, technology lets us deliver more customized and relationship-driven service and frees up smart people to do higher-level work to further benefit those clients,” Newman says. His team includes his business partner and four team members, and were just named the top team by sales and transaction volume for all of Keller Williams One Chicago for 2025.

This approach reflects a broader industry trend toward small, specialized teams that use technology to maximize efficiency and client experience. Newman’s model emphasizes depth of service over scale, allowing for more flexibility and better outcomes for clients.

Navigating Market Cycles

Newman cautions buyers and sellers to keep real estate cycles in mind. While the current market is strong, he notes that cycles of appreciation, stagnation, and decline typically occur every 10 to 15 years. “Some suburbs have grown more in five years than in the previous twenty,” Newman says.

Newman monitors distress metrics closely and notes a slight uptick in lender-mediated sales from historic lows. Still, Newman does not expect a repeat of the 2008 crash. Improved lending standards, higher down payments, and tighter mortgage regulations make the current environment more stable.

For buyers and sellers, timing and flexibility are key. “It’s easy to think you can wait until next year,” Newman says, “but government decisions could change things overnight.”

Chicago’s Long-Term Prospects

Despite these uncertainties, Newman remains broadly optimistic about Chicago’s trajectory. As Chicago continues to change, Newman remains confident in the city’s future. His recent investment in a three-unit building is both a business move and a show of confidence in Chicago’s real estate market.

“There are many great cities, but Chicago stands out for its neighborhoods and community spirit,” Newman says. “Walking into a family-owned business, you see the pride and hear the stories. That’s what makes Chicago special.”

Amid national headlines about unaffordability in major metros, Chicago stands apart for its amenities, opportunity, and relative value. For buyers, investors, and professionals, the city offers a chance to participate in a market that remains accessible and resilient when others are not.

About the Expert: Scott Newman is a Chicago-based real estate broker with nearly two decades of experience spanning luxury properties, distressed assets, and investment real estate. He leads Team Newman powered by KW ONEChicago, a boutique operation managing $160 million in annual volume across Chicago’s 77 neighborhoods and surrounding suburbs.

This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.