Buying a Home in Chicago: Steps, Costs and Help

This article is part of our Moving to Chicago guide.

Buying a home in Chicago follows a set path: get pre-approved, make an offer on the standard Multi-Board contract, clear a 5-business-day attorney review and inspection period, get your mortgage approved, and close. At the citywide median sale price of $405,000 (as of August 2026), plan on a down payment of $14,175 to $81,000 plus closing costs, including a city transfer tax of about $3,040 that the buyer pays. First-time buyers can tap state and city programs that cover part of that cash.

New to the city? Start with our Chicago guide.

Should a newcomer buy a home in Chicago?

Plenty of people do. Chicago recorded 1,907 closed home sales in August 2026, at a median price of $405,000, up 8.0% from a year earlier (Illinois REALTORS, August 2026). Redfin put the median time on market at 52 days as of September 2026 (Redfin).

Buying tends to make sense when three things are true:

You expect to stay several years, long enough for the up-front costs below to pay off.
You know which neighborhood you want. Many newcomers rent for a year first to learn the city.
Your job and income are settled, since lenders will check both.

For a rough comparison, the median one-bedroom rent is $2,200 (Zumper National Rent Report, September 2026). Buying the median home with 10% down, at a 6.5% rate for illustration, costs about $2,304 a month in principal and interest. Property tax (about $383 a month at the median tax year 2025 bill, billed in 2026) and insurance (about $312) bring that to roughly $3,000, before mortgage insurance or any condo assessment. That is our estimate; check today’s rate at Freddie Mac PMMS and see our rent vs. buy in Chicago breakdown.

The other early choice is condo or house. Our condo vs. single-family guide covers that.

How does buying a home in Chicago work, step by step?

1. Get pre-approved

A lender reviews your income, debts and credit and tells you how much you can borrow. Sellers expect the letter with your offer. If you want down payment help, choose a lender that takes part in those programs.

2. Make an offer on the Multi-Board 8.0 contract

Chicago-area brokers mostly use the Multi-Board Residential Real Estate Contract. Version 8.0 became available on February 1, 2025 (Chicago Association of REALTORS; contract text). Compared with 7.0, it:

puts any buyer-broker compensation paid by the seller into the contract itself
expands the inspection and “as-is” options
revises the financing contingency, adding secondary financing and grants
adds a paragraph on solar panels

You also put down earnest money. There is no fixed amount. Commonly it is about $1,000 to a few thousand dollars at acceptance, raised to about 5% (sometimes 10%) after attorney review (Chicago Metro Area Real Estate, updated 2014). The 8.0 contract has it paid to an escrowee named in the contract (paragraph 3).

3. Attorney review: 5 business days

Once the seller accepts, the contract enters attorney review. The 8.0 contract sets it at 5 business days from acceptance, counting Monday to Friday and skipping federal holidays (Multi-Board 8.0, paragraphs 13 and 25). During that window, either side’s attorney can approve the contract, propose changes or disapprove it, which ends the deal. If neither attorney sends notice in time, review is waived and the contract stands. The period can differ if the parties change it (Illinois Lawyer Now, April 2026).

Illinois law does not require a real estate attorney (O’Flaherty Law). Because the contract builds in attorney review, hiring one is customary in Chicago.

4. Inspection: usually alongside attorney review

The 8.0 contract gives you three inspection choices: waive professional inspections, inspect and request repairs, or inspect with no repair requests. If no choice is initialed, the waiver applies, so check this box with your agent. With either inspection option, you have 5 business days from acceptance to serve notice, the same window as attorney review (Multi-Board 8.0, paragraph 15). Repair requests are limited to major components such as the roof, heating, plumbing and electrical systems, and a working component isn’t a defect just because it is old. Book an inspector as soon as your offer is accepted. Your attorney uses the report to ask for repairs or a credit.

5. Mortgage contingency

This lets you cancel and recover your earnest money if your loan is not approved by a set date. Under the 8.0 contract, you must show written loan approval from your lender within 45 days after acceptance or 5 business days before closing, whichever comes first (Multi-Board 8.0, paragraph 8). That matches the deadline in the earlier 7.0 contract. Version 8.0 also adds an option for secondary financing or grants. Meanwhile the lender orders an appraisal and, for a condo, reviews the building.

6. Closing

You sign the loan, pay your remaining cash and get the keys. Chicago-specific items (Chicago Title, July 1, 2026):

The seller must have paid the water and sewer bills before closing.
Non-condo residential resales need a certificate of zoning compliance.
Transfer taxes are filed through the MyDec online system.
Property tax is prorated. Contracts often credit the buyer for the current year at 105% or 110% of the last full bill, because Illinois taxes are paid a year behind (O’Flaherty Law).

The contract doesn’t set a standard closing date. You and the seller write one in, and it has to leave room for the financing deadline, which falls no later than 45 days after acceptance.

How much cash do you need to buy a home in Chicago?

The biggest piece is the down payment. Here is what common down payment levels look like at the citywide median sale price of $405,000 (as of August 2026). Monthly payments assume a 30-year fixed loan at 6.5%, for illustration only; check the current rate at Freddie Mac PMMS.

Down payment	Cash down	Loan amount	Principal and interest per month (6.5%, illustration)
3.5%	$14,175	$390,825	$2,470
5%	$20,250	$384,750	$2,432
10%	$40,500	$364,500	$2,304
20%	$81,000	$324,000	$2,048

Our calculations on the $405,000 median (Illinois REALTORS, August 2026). Loans under 20% down usually add mortgage insurance, which is not included.

What are closing costs in Chicago?

Statewide, average closing costs were $4,702, or 1.30% of the price, based on 2025 data (Bankrate). That understates Chicago, where the buyer also pays a 0.75% city transfer tax. Budget 2% to 5% of the price (Doss, September 2026), or $8,100 to $20,250 on a $405,000 home.

Cost	Who pays	On a $405,000 home
City of Chicago transfer tax ($3.75 per $500)	Buyer	$3,037.50
CTA portion of city tax ($1.50 per $500)	Seller	$1,215
State of Illinois transfer tax ($0.50 per $500)	Seller, by custom	$405
Cook County transfer tax ($0.25 per $500)	Seller, by custom	$202.50
Lender’s title insurance policy	Buyer, when financing	Typically $400 to $800
Owner’s title insurance policy	Seller, customarily	Not a buyer cost in most deals
Home inspection	Buyer	Typically $300 to $550
Attorney fee	Buyer	Typically $750 to $1,500 in Chicago
First year of homeowner’s insurance	Buyer	$3,745 (see below)

Transfer tax rates as of July 1, 2026. Tax is figured on the price divided by $500, rounded up, times the rate. Title, inspection and attorney ranges are typical Illinois figures from Doss (updated September 8, 2026); get quotes for your deal.

Transfer taxes. The buyer pays the city’s $3.75 per $500 and the seller pays the $1.50 CTA portion (City of Chicago). The seller pays the state and county taxes by custom (Illinois REALTORS, January 2024). That puts the buyer at about 0.75% and the seller at about 0.45%. More in our Chicago property tax and transfer tax guide.

Title insurance and other fees. In most of Illinois the seller customarily buys the owner’s policy and a financing buyer pays for the lender’s policy, which typically runs $400 to $800. A home inspection typically costs $300 to $550, and Chicago buyers typically pay an attorney $750 to $1,500 (Doss, updated September 8, 2026). Chicago practice on title costs sometimes differs, so check your contract.

Homeowner’s insurance. NerdWallet puts the average Chicago policy at $3,745 a year, based on $400,000 of dwelling coverage, $300,000 of liability and a $1,000 deductible (NerdWallet, March 2026). Condo owners buy a cheaper walls-in (HO-6) policy instead.

Budget for the move too; see our moving costs by city.

What help is there for first-time buyers in Chicago?

Three programs cover the most ground. All run through approved lenders or lending partners and have income or price limits, so ask your lender which fit before you make an offer.

IHDA (statewide)

The Illinois Housing Development Authority pairs a 30-year fixed-rate mortgage with down payment help. You contribute the greater of $1,000 or 1% of the price, and you need a credit score of at least 640 (IHDA; IHDA Mortgage, as of October 2026).

IHDA program	Amount	Terms
Access Forgivable	4% of price, up to $6,000	Forgiven over 10 years
Access Deferred	5%, up to $7,500	0% interest, repaid when the loan ends
Access Repayable	10%, up to $10,000	0% interest, repaid over 10 years
Access Home	6%, up to $15,000	Deferred; for first-time buyers, veterans or targeted areas

IHDA program terms as listed on ihda.org, checked October 21, 2026. Access Forgivable, Deferred and Repayable are open to first-time and repeat buyers.

City of Chicago Home Buyer Assistance Program

The City’s flyer describes a grant of up to 7% of the loan amount, for example $17,500 on a $250,000 loan, for owner-occupied 1-to-4-unit homes, condos and townhomes, with income limits that depend on the loan type (City of Chicago flyer). The flyer is undated, and the Chicago Infrastructure Trust, which administers the program, posts no current date or limits. Ask a participating lender whether it is still open and what the income limits are today.

City of Chicago HomeGrown Purchase Assistance

Launched in June 2026, HomeGrown gives grants for homes in designated zones (Chicago Association of REALTORS, June 2026). Amounts depend on the zone and your income as a share of area median income (AMI):

Zone	Largest grant	Smallest grant
Zone A	$70,000 (up to 80% AMI)	$40,000 (101% to 120% AMI)
Zone B	$50,000 (up to 80% AMI)	$10,000 (121% to 150% AMI)

HomeGrown grant amounts as of June 2026.

Grants are capped at 25% of the price. You put in at least 1%, take homebuyer education and live there as your main home for 5 years. It covers single-family homes, condos, townhomes and two-unit buildings, and you can’t own another home when you buy (NHS Chicago). Neighborhood Lending Services and TRP Lending run it.

How does property tax fit into buying a home in Chicago?

The median Chicago homeowner bill was $4,597 for tax year 2025, billed in 2026 (Cook County Treasurer, August 2026). The homeowner exemption cuts $10,000 from your equalized assessed value (Cook County Assessor), which saved $699.90 in the Treasurer’s tax year 2023 Chicago example. You need to live in the home on January 1 of the tax year, so it starts with the tax year after you move in.

Bills are paid a year behind, so the seller credits you for their share at closing. Our property tax guide explains the bill formula, due dates and appeals.

Frequently asked questions

Do I need a lawyer to buy a home in Chicago?

Illinois law does not require one, but hiring an attorney is customary. The standard contract gives your attorney 5 business days after acceptance to propose changes or disapprove the deal.

Who pays the transfer tax in Chicago?

The buyer pays the city’s $3.75 per $500 (0.75%). The seller pays the CTA portion and, by custom, the state and county taxes, about 0.45% in total.

How much do I need saved to buy a median-priced Chicago home?

At $405,000 (August 2026), a 3.5% down payment is $14,175 and 20% is $81,000. Add 2% to 5% for closing costs, or $8,100 to $20,250. Down payment programs from IHDA and the City can cover part of this.

Sources

Author: Go Big City Team

Next step: see the full Moving to Chicago guide for rent, costs, transit, weather, jobs and neighborhoods in one place.