Side-by-side comparison of mortgage costs, property taxes, closing costs, and homeowners insurance between Illinois and Iowa. Updated for 2026.
Iowa wins 5 of 6 cost categories, making it the more affordable state for homebuyers overall. With a median home price of $210K and lower overall costs, Iowa offers meaningful savings compared to Illinois. Both states offer first-time buyer programs — explore the state pages for full details.
Estimated PITI payments assuming 10% down, 6.5% rate, 30-year fixed mortgage with PMI.
The monthly payment difference is $572/month — that’s $6,864/year or $206K over the life of a 30-year loan. Buying in Iowa is the more affordable option based on median home prices with identical loan terms.
Based on the 28% debt-to-income rule — your monthly housing payment should not exceed 28% of gross monthly income.
To afford the median home in Illinois, you need a household income of approximately $97K/year. In Iowa, you need $72K/year — less by $25K/year. That $25K income gap means Iowa is accessible to a significantly wider range of households.
Iowa offers meaningfully lower home prices than Illinois, with median prices running 22% less ($60K difference). This gap translates to both a smaller loan and lower monthly payments. First-time buyers priced out of Illinois may find Iowa far more accessible, particularly when combined with local down payment assistance programs.
Iowa has a moderate property tax advantage at 1.52% versus Illinois's 2.07%. While the rate gap of 0.55% may seem small, it translates to an annual difference of approximately $2,397 when applied to each state's median home price. Over a typical homeownership period of 7-10 years, that adds up to $19K in savings.
Closing costs are a one-time but significant expense. Illinois averages $5K in closing costs (2% of purchase price) while Iowa averages $2K (1%). The difference is spread across title insurance, attorney fees, and recording costs rather than a single large tax. Budget for these upfront costs — they affect how much cash you need on hand at closing.
Both states offer down payment assistance for first-time buyers. Illinois's IHDA 1stHomeIllinois provides $7,500 forgivable loan, while Iowa's IFA FirstHome offers $2,500 grant. These programs can significantly reduce your upfront costs and make homeownership accessible even if you haven't saved a full 20% down payment. Check eligibility requirements on each state's housing finance agency website — income limits and purchase price caps apply.
The bottom line: Illinois and Iowa are broadly similar in housing costs, with only $572/month separating them in total PITI payments. In cases like this, your decision should be driven by lifestyle preferences — job opportunities, climate, proximity to family, and quality of life — rather than pure cost savings. Either state offers a reasonable path to homeownership.