The short answer
At today's Chicago prices and rents, owning overtakes renting in year 6 — inside a normal holding period, and despite the heaviest property-tax bill on this site.
That combination is the reason this page is worth reading. Chicago's effective property-tax rate of 1.90% is the highest of any metro we cover — higher than Miami's, higher than Austin's, nearly four times Phoenix's — and it still loses to a price that is low enough against rents to overwhelm it.
| Input | Value | Source |
|---|---|---|
| Typical home value | $380,123 | Zillow Home Value Index (ZHVI), single-family homes only, smoothed & seasonally adjusted (Metro_zhvi_uc_sfr_tier_0.33_0.67_sm_sa_month.csv) (July 2026) |
| Typical single-family rent | $2,576 / month | Zillow Observed Rent Index (ZORI), single-family residences, smoothed (Metro_zori_uc_sfr_sm_month.csv) (July 2026) |
| Effective property-tax rate | 1.90% | Cook County assesses Class 2 residential property at 10% of market value; the Illinois Department of Revenue then applies a county equalization factor to bring the county to the statutory 33 1/3%, and the 2025 final multiplier is 3.0300. So a $380,123 house carries an assessed value of $38,012 and an equalized assessed value of $115,177. The homeowner exemption removes $10,000 of EAV for an owner-occupier, leaving $105,177, and the 2025 composite rate for Chicago tax code 70001 — the most common of the 1,025 codes inside the city, covering the Board of Education at 3.832979, the City of Chicago at 1.666599, the Park District, the county, the Water Reclamation District, City Colleges and the Forest Preserve — is 6.853152%. That is $7,208 a year, or 1.8962%, rounded to 1.90%. This is deliberately the ceiling: Cook reassesses Chicago on a three-year cycle (2024, next in 2027) and a sale does not reset the assessment, so a 2026 buyer is billed on the assessor's 2024 estimate rather than on the price they paid. Why not the Census ratio: Illinois caps no assessment and resets nothing on sale, so — as in Seattle and Denver — the ACS ratio is not describing a different taxpayer here. What it is describing is a different place. The 2.08% it reports is a nine-county CBSA average, and Chicago is the cheap part of it: composite rates in south suburban Cook run past 15%, against the city's 6.85%, because a thin commercial base has to fund the same schools. Applying the CBSA ratio to a City of Chicago purchase would overcharge a buyer by about $700 a year. For the record, that ratio is 2.08% — $6,266 median taxes paid ÷ $301,900 median home value for CBSA 16980, per US Census Bureau, American Community Survey — tables B25103 (median real estate taxes paid) and B25077 (median home value), metro level (2023 5-year estimates).Cook County Clerk, 2025 Tax Code Agency Rate file (tax code 70001, City of Chicago); 2025 Cook County final equalization factor of 3.0300 per the Illinois Department of Revenue; Class 2 assessment level per the Cook County Real Property Assessment Classification Ordinance; $10,000 homeowner exemption per 35 ILCS 200/15-175 (2025 tax year (payable 2026)) |
| Homeowner's insurance | $1,705 / year | Cook, DuPage, Kane, Kendall, Lake (IL), McHenry, Will, Lake (IN) and Porter Counties. Illinois publishes no premium data below the state level, so this is the NAIC's 2023 Illinois HO-3 average of $1,480 — written premium over written exposures — moved onto the metro by the Chicago CBSA's position in the quoted series: $3,045 against a $2,643 Illinois average, a ratio of 1.152. Both sides of that ratio are priced at $300,000 of coverage, so it measures geography and nothing else. $1,480 x 1.152 = $1,705. The level is a 2023 figure, the most recent written data the NAIC publishes, so it trails the 2026 price and rent on the rest of this page. On the one series where the same thing can be measured, Texas, written premiums rose 25% between 2023 and 2025. Treat this as a floor. Two of the nine central counties in the geography factor — Lake and Porter — are in Indiana, whose NAIC average is $1,304 rather than Illinois's $1,480, and they hold 8.2% of the metro's owner-occupied units. Pricing them off Indiana's figure instead would give $1,688, so this page's single-state simplification overstates the metro by about $17 a year. This page previously published $3,045, a quoted premium from a rate-comparison sample at a fixed $300,000 of coverage. Quotes run above what insurers actually write, so we moved to the written figure.NAIC, Dwelling Fire, Homeowners Owner-Occupied, and Homeowners Tenant and Condominium/Cooperative Unit Owner's Insurance Report: Data for 2023 (published July 2026), Table 4 — average premium by policy form, HO-3, written premium divided by written exposures. Counties per US Census Bureau / OMB, Core Based Statistical Area delineation — central counties of each CBSA (July 2023); the quoted premium it replaced per Insurance.com (Quadrant Information Services) average annual homeowner's premium by ZIP code — $300,000 dwelling coverage, $300,000 liability, $1,000 deductible, 2% hurricane deductible in Florida; averaged over the CBSA's central counties and weighted by owner-occupied units (August 2026) (2023 data year) |
Why Chicago lands here
Two numbers, pulling hard in opposite directions.
The first is price-to-rent. At $380,123 against $2,576 a month, Chicago's ratio is 12.3 — the third-lowest of our metros, behind Pittsburgh and Houston. A ratio that low means the purchase price is only about twelve years of rent, so the mortgage on it is small relative to what renting the same house costs. Month one is $2,985 to own against $2,591 to rent: a gap of under $400 a month, on $85,127 of cash to close.
The second is the tax bill. $7,222 a year is about $600 a month — one and a half times the monthly gap, by itself — and it is within $450 of what a Seattle buyer pays on a house worth more than twice as much. Charge this same Chicago house Denver's 0.54% instead and the break-even year moves from year 6 to year 3.
The first number wins, but not by much, and that is the honest summary of Chicago: a cheap house with an expensive bill attached, where the cheapness is the larger effect. It also means this page is unusually sensitive to the tax rate — more so than any other metro here — so the derivation below is worth more of your attention than usual.
Where 1.90% comes from, and why it is not the Census number
Cook County's arithmetic is genuinely convoluted, so here is the whole chain rather than an assertion.
- Cook assesses Class 2 residential property at 10% of market value. On $380,123 that is an assessed value of $38,012.
- The Illinois Department of Revenue applies a county equalization factor to bring the county up to the statutory 33 1/3%. The 2025 final multiplier is 3.0300, so the equalized assessed value is $115,177.
- The homeowner exemption removes $10,000 of EAV for an owner-occupier, leaving $105,177.
- The composite tax rate for Chicago tax code 70001 — the most common of the 1,025 codes inside the city — is 6.853152%, made up of the Board of Education at 3.832979, the City of Chicago at 1.666599, and the Park District, Cook County, the Water Reclamation District, City Colleges and the Forest Preserve underneath.
That is $7,222 a year, or 1.90%.
This page publishes the derived rate rather than the Census ratio of 2.08% — which would have charged $7,907 — and for once the shortcut is too high, not too low. Illinois caps no assessment and resets nothing on sale, so unlike Miami or Los Angeles this is not a case of the survey measuring a different taxpayer. It is measuring a different place. The Census ratio is a nine-county average, and Chicago is the cheap part of it: composite rates in parts of south suburban Cook run past 15% against the city's 6.85%, because a thin commercial base has to fund the same schools. Using the metro-wide ratio on a City of Chicago purchase would have overcharged a buyer by about $700 a year.
Where our figure is deliberately the ceiling. Cook reassesses Chicago on a three-year cycle — 2024, next in 2027 — and a sale does not reset the assessment. So a 2026 buyer is billed on the assessor's 2024 estimate of the house, not on the price they just paid. Where that estimate is below the price, the real first-year bill is lower than $7,222. We charge the full amount because the assessor catches up and we would rather overstate a buyer's cost than understate it — but if you are running your own numbers, look up the parcel's actual assessed value before you accept ours.
Where it could be too low. Chicago's tax codes are not uniform: special service areas and TIF districts sit on top of the composite rate in parts of the city, and the 1,025 codes inside the city limits are not all 6.853152%. And the second-instalment bill is where Cook's re-assessment shocks land — a reassessment year can move an individual bill by double digits in a way an average rate does not show.
The assumption that decides it
At our default 7% assumed return on the renter's invested capital, owning overtakes renting in year 6. At a more conservative 5%, owning breaks even in year 5.
One year. That is the narrowest sensitivity on this site, and it is a genuine feature of the page rather than a coincidence: the renter's head start is only $85,127, so there is not much capital for the return assumption to work on. In Los Angeles the same assumption moves the answer from "never" to year 22. Here it barely registers.
Which means the thing to argue with on this page is not the return rate. It is the tax rate — and if you think Cook County will keep raising levies faster than incomes, raise the property-tax input and watch year 6 slide. That is the risk this page is actually carrying.
What we are not modelling
Illinois has no state real estate transfer tax on the buyer, but Chicago does have a transfer tax, and the split is unusual: the City charges $5.25 per $500 of price, of which $3.75 is statutorily the buyer's and $1.50 the seller's, plus $0.75 per $500 to the State and County that falls on the seller. On $380,123 the buyer's share is roughly $2,850 in extra day-one cash that our standard model does not charge. Folded in, the break-even year moves from year 6 to year 7. We report it here rather than in the headline because, unlike Pittsburgh's 2.5%, it is a fixed statutory split rather than a negotiable custom, and because one year is inside the noise on a page this sensitive to the tax rate.
Assessment appeals are close to a local sport. A large share of Cook County residential parcels are appealed, and successful appeals shift the burden onto everyone who did not appeal. Our rate assumes you do not appeal. If you do, and win, your bill is lower and this page is pessimistic.
Condo and multi-unit stock is not this page. We price a single-family house on both sides — Zillow's single-family value index against its single-family rent index — because the engine compares renting and owning the same home. Chicago has a very large two- to four-flat and condo stock that this template does not describe, and a two-flat with a tenant is a different financial question entirely.
Two of the metro's nine central counties are in Indiana — Lake and Porter. They are in the insurance geography and in the Census figures, and Indiana's property tax works nothing like Illinois's: it caps homestead bills at 1% of gross assessed value. A buyer in Munster or Valparaiso faces a materially lower tax line than the one on this page.
One national appreciation rate, 3.5%, as on every metro page here. We do not forecast metro-level price growth, because doing so would silently drive the result while looking like a fact. Chicago has appreciated more slowly than the national average over the last two decades; if you think that continues, lower the appreciation input and re-run. Because this page's buy case rests on the monthly comparison rather than on price growth, it holds up better under a low-appreciation assumption than Los Angeles's or Seattle's would.
Check it yourself
Open this Chicago scenario in the calculator →
Related reading: PITI plus HOA and insurance, which is really about the carrying costs that decide this page, and the rent-to-price ratio.