Side-by-side comparison of mortgage costs, property taxes, closing costs, and homeowners insurance between Illinois and South Dakota. Updated for 2026.
South Dakota wins 3 of 6 cost categories, making it the more affordable state for homebuyers overall. However, Illinois has a lower total cost when combining home price, closing costs, and insurance. 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 $19/month — that’s $228/year or $7K over the life of a 30-year loan. Buying in Illinois 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 South Dakota, you need a household income of approximately $98K/year. In Illinois, you need $97K/year — less by $814/year. With similar income requirements, your choice between these states can focus on lifestyle and career factors rather than pure affordability.
Home prices in Illinois and South Dakota are relatively close, with only a 8% difference ($25K). At similar price points, your decision should focus on the other cost factors: property taxes, insurance, closing costs, and the overall quality of life each state offers. Small percentage differences in tax rates compound over decades of homeownership.
South Dakota has a moderate property tax advantage at 1.22% versus Illinois's 2.07%. While the rate gap of 0.85% may seem small, it translates to an annual difference of approximately $1,990 when applied to each state's median home price. Over a typical homeownership period of 7-10 years, that adds up to $16K in savings.
Closing costs are a one-time but significant expense. Illinois averages $5K in closing costs (2% of purchase price) while South Dakota averages $2K (0.7%). 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 South Dakota's SDHDA First-Time Homebuyer offers Fixed-rate FTB loans. 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 South Dakota are broadly similar in housing costs, with only $19/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.