The 5 Best Places to Buy Rental Property in Illinois

By Emma Woodward

Posted on July 15th, 2022

Chicago | Aurora | Naperville | Rockford | Joilet

Photo of the Chicago skyline

💰 What is the best place to buy rental property in Illinois? 💰
The best place to buy rental property in Illinois is Chicago, followed by Aurora and Naperville.

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Midwesterners are known for their friendly demeanor and world-class kindness, so it’s no surprise that Illinois earned high marks as one of the best states to live in. Beyond Chicago — the third most populous city in the U.S. — Illinois offers a variety of other cities that attract residents and tourists alike.

Rich cultural experiences and kind people aren't the only factors that make Illinois one of the best places to buy rental property. As of May 2022, Illinois has a median home price of $256,000 — 50% less than the current national average.

From March 2021 to March 2022, home values in Illinois rose 14%. Real estate investors can confidently purchase affordable properties in the state knowing values are likely to appreciate further.

To help you figure out the best places to buy rental property in Illinois, we evaluated the state's most populous cities according to:

  • Affordability: Current home values vs. national averages
  • Investment Potential: How home values have changed since 2015
  • Rental Rates: Average rent for a two-bedroom apartment
  • Amenities: Local attractions

If one of the cities on our list catches your eye, you can get advice from an experienced local real estate agent and up to 0.5% cash back at closing by working with our friends at Clever Real Estate. In Illinois, that's up to $1,280 back in your pocket.

Clever is a free, no-obligation agent matching service that will introduce you to qualified, pre-vetted realtors from trusted brokerages including Keller Williams, RE/MAX, and Coldwell Banker. You can meet as many agents as you like until you find the best one to advise you on your real estate investment journey.

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1. The Best Place to Buy Rental Property in Illinois: Chicago

Chicago is known as the windy city, but savvy real estate investors also know Chicago as a great metro area to invest. Compared to other popular metros in the U.S. (such as New York City, LA, or Seattle), Chicago's lower home prices make it much more affordable.

As of May 2022, the median home price in Chicago was $318,500. And while Chicago suburbs are seeing a wildly competitive market, current competition for downtown Chicago housing is a bit more tame. According to Zumper, median rent for a two-bedroom apartment in Chicago was $2,250 as of May 2022.

Chicago is a prime destination for tourists and renters alike. Known as one of the best cultural cities in the U.S., Chicago has world-class museums, music festivals, incredible architecture and sports teams.

2. Aurora

Located just 40 miles west of Chicago, Aurora offers accessibility to Illinois' biggest metro with less hustle and bustle. Plus, Aurora housing prices are more affordable, with a median sale price of $241,209 as of March 2022. The average price to rent a two bedroom apartment in Aurora currently is $1,700 per month.

Aurora is close to Chicago if residents want a big city experience, the area has a Broadway theater, outlet shopping, and the largest waterpark in Illinois. Located in the Fox River Valley, Aurora also offers a variety of outdoor experiences, including hiking, boating, and biking along the many nearby trails.

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3. Naperville

A suburb just west of Chicago, Naperville offers plentiful amenities and activities for families. A popular outdoor option is Centennial Beach — an old quarry that's been converted into a community swimming hole with nearby grilling and picnicking spots. There's also a range of creative museums to explore, including Naperville Settlement, a living history museum, and DuPage Children's Museum to entertain little ones.

The cost to invest in Naperville real estate is relatively high, with a median sale price of $471,000, but the payoff is also high. The average rent for a two-bedroom apartment in the area is $1,900 per month.

4. Rockford

If you’re looking for the best market for investors on a budget, Rockford is the place for you. With a median home price of $130,000, Rockford offers single family homes and apartments at a lower price point. Home values are appreciating quickly, with a 22% spike in the past year alone.

Monthly rent for a two-bedroom apartment is currently around $850 on average, and Rockford has the region's highest percentage of renters.

Financial considerations aside, Rockford's central location and iconic history make it an attractive place to live. The city offers relatively easy access to both Chicago and Madison, WI, and in 2020, it was ranked as one of the best places to live by U.S. News and World Report. It's also home to the Rockford Peaches — the iconic women’s baseball team that inspired the film, A League of Their Own.

5. Joilet

The fourth largest city in Illinois, Joliet is known as the filming location for more than 100 TV shows and movies and home of the first-ever Dairy Queen. The city also sits along the historic Route 66 and offers the Route 66 Welcome Center.

If you're looking for a place to buy investment apartments, Joliet presents some great options. The median home price is $198,000, making it one of the more affordable places to invest on our list. As of May 2022, the average two-bedroom apartment rents for around $1,325 per month.

Next Steps for Your Rental Property Investment

From Chicago's world-class cultural attractions to Rockford's comparatively affordable home prices, Illinois offers plenty of opportunities for real estate investors.

Serious about investing? You need an agent. Local real estate agents can help you navigate up-and-coming markets and quickly identify the best opportunities.

Our friends at Clever Real Estate make it easy to meet the best real estate agents in Illinois. It's free to meet agents through Clever, with zero obligation!

Best of all, real estate investors who find an agent through Clever can easily take advantage of Illinois's buyer rebate opportunities. You can receive up to 0.5% cash back at closing, which you can use to offset closing costs, get your new property ready for renters, or simply enjoy as extra money in your pocket.

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Did you know 41 states and Washington D.C. allow cash rebates for home buyers? Our friends at Clever can match you with trusted local real estate agents and help you get 0.5% cash back. You can spend your money any way you'd like — no questions asked!

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FAQs

What is the best place to buy rental property in Illinois?

Chicago is the best place to buy rental property in Illinois, followed by Aurora and Naperville. Learn how population growth, job opportunities, and home values impact rental property investments.

Is rental property a good investment?

In general, rental property is considered a sound investment, but a rental property's success or failure depends on both local market conditions and business strategy. Learn how to spot good investment opportunities — and save time, energy, and money — before buying a rental property in Illinois.

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Posted in Buying a House, Real Estate Investing