Side-by-side comparison of mortgage costs, property taxes, closing costs, and homeowners insurance between Illinois and Kentucky. Updated for 2026.
Kentucky wins 4 of 6 cost categories, making it the more affordable state for homebuyers overall. With a median home price of $210K and lower overall costs, Kentucky 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.
Buying in Kentucky saves you approximately $642/month ($7,704/year) compared to Illinois, based on median home prices with identical loan terms.
Kentucky 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 Kentucky far more accessible, particularly when combined with local down payment assistance programs.
Property taxes are dramatically different: Kentucky charges 0.83% while Illinois charges 2.07%, a gap of 1.24 percentage points. On the respective median homes, this means Illinois homeowners pay roughly $5,589 per year in property taxes versus $1,743 in Kentucky. Over 30 years of homeownership, this difference alone can add up to six figures. Retirees on fixed incomes should weigh this heavily.
Both states offer down payment assistance for first-time buyers. Illinois's IHDA 1stHomeIllinois provides $7,500 forgivable loan, while Kentucky's KHC Regular DAP offers Up to $6,000 repayable loan. 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: property taxes are the defining difference here. Illinois's 2.07% rate versus Kentucky's 0.83% means Kentucky homeowners save approximately $3,846 every year on taxes alone. Over a 30-year mortgage, that difference compounds into tens of thousands of dollars — making it the most important cost factor in this comparison.