C
hicago's housing market has taken a significant hit in Zillow's latest ranking of the hottest markets. The city dropped 17 spots, from 22nd to 39th, due to falling home prices and slower sales velocity. This is largely attributed to an oversupply of homes on the market.

    Zillow's analysis considers factors such as forecasted home value growth, housing market velocity, labor market changes, construction activity, and homeowner households. In Chicago's case, prices are decreasing while homes sit longer on the market.

    New construction in northern suburbs like Glenview and Northbrook has driven up median prices. The high-end North Shore is also experiencing a surge in demand due to new builds and renovations. Indianapolis, however, takes the top spot in the Midwest as a relatively affordable option with strong employment and income growth driving housing demand.

    With interest rates no longer at historic lows, buyers should act quickly when finding a property they love. Affordability and inventory are key considerations for homebuyers, and understanding one's budget can make all the difference in securing a dream home.