The 5 best rental markets in Illinois for investors & property managers in 2026

Illinois Rental Market Trends in 2026

Illinois is the sixth-most populous state in the U.S., mostly thanks to Chicago, the third-largest metro area in the country. However, this list will focus on the 5 best rental markets in Illinois outside of Chicago—from college town Champaign in the south to Rockford in the north, and everywhere in between.

Illinois has a diverse and resilient economy anchored by industries like manufacturing, agriculture, finance, healthcare, and logistics. The state benefits from its central location as a national transportation hub. While the state has faced challenges, such as fiscal pressures and deindustrialization, recent investments in infrastructure, technology, and workforce development are helping Illinois to revitalize its economy and attract new business.

If you’re looking to expand your real estate portfolio or property management services within Illinois, this post will guide you through evaluating 5 up-and-coming real estate markets there. We’ll share rental market statistics for each city, including inventory growth, rent growth, vacancy rates, cap rates, and home value appreciation. We’ll also highlight economic and demographic trends in each market.

Top 5 Rental Markets in Illinois for 2026

Without further ado, here are 5 Illinois rental markets where our research indicates growth opportunities lie in 2026.

Market #1: Rockford, IL

334,124 residents call the Rockford metro area home, making it the fifth-most populous city in Illinois overall, and the largest city outside of the Chicago metro area. Rockford can be found along the Rock River in northern Illinois, approximately an hour and a half west of Chicago, and an hour and a half south of Madison, WI.

Rockford’s economy has revolved around manufacturing since the 1850s, when the city was first connected to other cities by rail, enabling companies to ship agricultural machinery and furniture to other markets. This manufacturing boom continued through the mid-20th century, with Rockford being further connected to other cities by Interstate 90. In 1963, the metro area was chosen by Chrysler (now Stellantis) as the location for the Belvidere Assembly plant, which remains a major employer there to this day.

Like other Rust Belt cities, Rockford was impacted by deindustrialization and population loss throughout the 1970s and ‘80s. The city was challenged further by the Great Recession, the loss of Amtrak rail service, and multiple flooding events in the early 21st century. In recent years, however, Rockford has worked hard to diversify its industrial economy and restore its downtown neighborhood.

Today, the city is known for manufacturing fasteners as well as parts for the automotive and aerospace industries, with plants for Collins Aerospace, Woodward Inc., and Stellantis located here. In addition, there are several healthcare companies—UW Health, Mercy Health, and OSF Healthcare—located in Rockford. Other top employers in the area include Rockford Public School District, UPS, Amazon, and Walmart. Several higher educational institutions, including Rockford University and Rock Valley College, can also be found in Rockford.

Rockford boasts a number of cultural attractions, including the Anderson Japanese Gardens, the Discovery Center Museum, the Burpee Museum of Natural History, Nicholas Conservatory & Gardens, Rockford Art Museum, and Coronado Performing Arts Center. The city also has a number of green spaces where residents can spend time outdoors, such as Sinnissippi Park and Riverwalk, Rock Cut State Park, and Rockwood Park.

Rockford’s strong multifamily rent growth, occupancy rate, and cap rate helped it rank in position #4 on Buildium’s list of up-and-coming real estate markets in 2026, along with its impressive home price appreciation. In spite of this growth, properties remain very affordable in Rockford, creating an opportunity for investors to get their foot in the door in the Illinois real estate market.

Rockford, Illinois Rental Market Statistics

• Rental Inventory (Q3-’25): 9,255
• Units Added Since Q3-’24: +0
• Asking Rent Growth Since Q3-’24: 4.6%
• Asking Rent (Q3-’25): $1,150
• Effective Rent (Q3-’25): $1,145
• Multifamily Vacancy Rate (Q3-’25): 4.1%
• Multifamily Cap Rate (Q3-’25): 8.0%

Source: National Association of Realtors

Rockford, Illinois Housing Market Statistics

• Average Home Value (Q4-’25): $169,916
• Home Value Appreciation Since Q4-’24: 8.7%

Source: Zillow

Rockford, Illinois Economic Statistics

• Population Growth (2025): 0.9%
• GDP Growth (2023): -0.2%
• Job Growth (Q3-’25): 0.4%

Source: National Association of Realtors

Lists That Mention Rockford, Illinois

• Emerging Housing Markets Index – Winter 2025 (WSJ/Realtor.com): #2
• Emerging Housing Markets Index – Spring 2025 (WSJ/Realtor.com): #3
• Emerging Housing Markets Index – Summer 2025 (WSJ/Realtor.com): #9
• Emerging Housing Markets Index – Fall 2025 (WSJ/Realtor.com): #2
• Best Real Estate Markets (WalletHub): #162

Market #2: Champaign, IL

Located approximately two hours from Chicago and two and a half hours from St. Louis, the Champaign metro area is home to 237,052 residents. Together with Urbana, its twin city, Champaign has been a college town since 1867, when the University of Illinois was founded here.

Champaign got its start as a railroad town in the 1850s, with the arrival of Illinois Central Railroad transforming the area into a regional hub for trade and agriculture. By the early twentieth century, manufacturing and light industry began to take root. However, the city faced the economic headwinds of suburbanization and deindustrialization during the mid-1900s. In response to this economic stagnation and urban disinvestment, Champaign has devoted many resources to downtown redevelopment and public infrastructure in recent years. The city has since seen a resurgence in downtown activity, featuring new restaurants, housing, and cultural venues.

Today, several Fortune 500 companies have offices in Champaign, including IBM, John Deere, Dow Chemical Company, Caterpillar, and State Farm. In addition, Jimmy John’s is headquartered in the city. Champaign is also part of a region known as the Silicon Prairie, with the University of Illinois’ research ecosystem helping to create an atmosphere conducive to the formation of tech startups, particularly in the software, agriculture, and clean energy fields.

UIUC also contributes to Champaign’s rich cultural landscape. Residents and visitors enjoy the University of Illinois Arboretum, Krannert Art Museum, Spurlock Museum, Virginia Theatre, Hessel Park, and (in nearby Urbana) Meadowbrook Park. Downtown Champaign, once impacted by urban disinvestment, is now known for blending small-town charm with urban energy. Particularly vibrant in the warmer months, the city features sidewalk cafes, street fairs, art walks, and live music.

Champaign ranked in position #28 on Buildium’s list of up-and-coming real estate markets in 2026 due to its moderately strong multifamily rent growth and cap rates over the last few years. In addition, properties in Champaign are relatively affordable and have shown strong price appreciation in recent years, making this another great market for investors to consider—particularly with the population and employment growth that this college town is seeing in comparison with other Illinois rental markets.

Champaign, Illinois Rental Market Statistics

• Rental Inventory (Q3-’25): 17,112
• Units Added Since Q3-’24: +189
• Asking Rent Growth Since Q3-’24: 3.4%
• Asking Rent (Q3-’25): $1,153
• Effective Rent (Q3-’25): $1,148
• Multifamily Vacancy Rate (Q3-’25): 6.5%
• Multifamily Cap Rate (Q3-’25): 7.6%

Source: National Association of Realtors

Champaign, Illinois Housing Market Statistics

• Average Home Value (Q4-’25): $224,617
• Home Value Appreciation Since Q4-’24: 5.5%

Source: Zillow

Champaign, Illinois Economic Statistics

• Population Growth (2025): 2.6%
• GDP Growth (2023): 3.3%
• Job Growth (Q3-’25): 1.3%

Source: National Association of Realtors

Lists That Mention Champaign, Illinois

None – this is an under-the-radar pick

Market #3: Bloomington, IL

170,441 residents live in the Bloomington metro area, which it shares with Normal, its twin city. Bloomington is located roughly two and a half hours from both Chicago and St. Louis, and is considered a transportation hub within central Illinois due to the number of interstates that pass through the area.

Insurance company State Farm has been based in Bloomington for more than a century, and it remains the city’s top employer to this day, followed by fellow insurance company Country Financial. Two universities—Illinois Wesleyan University and Illinois State University—are located in the Bloomington–Normal metro area as well. Other top employers in the metro include Carle Bromenn Medical Center, OSF St. Joseph Medical Center, the city and county governments, and the local school districts.

Bloomington offers residents and visitors a number of cultural opportunities. The Bloomington Center for the Performing Arts is a great place to catch a concert or play, while the Miller Park Zoo is a family-friendly destination for both education and leisure. Historical attractions located in the city include the McLean County Museum of History, as well as Davis Mansion, a site offering a glimpse into the life of a past Supreme Court Justice. Bloomington residents can also enjoy walking, jogging, and cycling on the Constitution Trail, which winds through the city’s parks and neighborhoods. In addition, a number of golf courses and country clubs are located within the metro area.

Bloomington ranked in position #45 on Buildium’s list of up-and-coming real estate markets in 2026 due to its strong cap rates and occupancy rates and moderately strong rent growth over the last few years. Its affordability makes it appealing for residents and investors alike, leading to population growth and strong multifamily metrics, though its economy and job market are both trending slightly negative this year—something to keep an eye on in the years to come.

Bloomington, Illinois Rental Market Statistics

• Rental Inventory (Q3-’25): 10,094
• Units Added Since Q3-’24: +12
• Asking Rent Growth Since Q3-’24: 2.1%
• Asking Rent (Q3-’25): $1,191
• Effective Rent (Q3-’25): $1,186
• Multifamily Vacancy Rate (Q3-’25): 4.1%
• Multifamily Cap Rate (Q3-’25): 7.9%

Source: National Association of Realtors

Bloomington, Illinois Housing Market Statistics

• Average Home Value (Q4-’25): $254,363
• Home Value Appreciation Since Q4-’24: 5.0%

Source: Zillow

Bloomington, Illinois Economic Statistics

• Population Growth (2025): 1.0%
• GDP Growth (2023): -0.2%
• Job Growth (Q3-’25): -1.3%

Source: National Association of Realtors

Lists That Mention Bloomington, Illinois

• Best Places to Live (U.S. News): #168

Market #4: Peoria, IL

Peoria is located in central Illinois, a little under three hours from Chicago and two and a half hours from St. Louis. This four-time winner of the All-America City Award has 361,989 residents living in its metro area.

Prior to Prohibition, Peoria’s early economy was shaped by the liquor industry thanks to its abundant corn supply and location along the Illinois River. Following its reign as a distilling powerhouse, Peoria reinvented itself as a manufacturing hub. For much of the twentieth century, Caterpillar formed the economic backbone of the region, employing tens of thousands of workers there; and though it moved its headquarters to Deerfield in 2017, Caterpillar remains Peoria’s second-highest employer.

As was the case for other Rust Belt cities, Peoria’s economy had to adjust as deindustrialization and automation reduced manufacturing jobs in the second half of the twentieth century. Since then, Peoria has worked hard to diversify its economy. Today, top employers (besides Caterpillar) include healthcare companies OSF Healthcare and Carle Health, along with Peoria Public Schools, Vonachen Services, and Bradley University.

Peoria is also working hard to enhance its livability by improving housing affordability and quality, expanding economic opportunity, and revitalizing neighborhoods and public infrastructure. Peoria’s investment in downtown improvements have resulted in an influx of new business and foot traffic to the city center.

Residents and visitors to Peoria can enjoy a host of cultural attractions that reflect the city’s industrial heritage and natural beauty, including the Peoria Riverfront Museum, Caterpillar Visitors Center, Luthy Botanical Garden, and Forest Park Nature Center. Peoria also hosts the Heart of Illinois Fair each summer, as well as the renowned Annual Art Fair. Sports fans can catch a baseball game at Dozer Park, while families may particularly enjoy the Peoria PlayHouse Children’s Museum and Peoria Zoo. In addition, Peoria’s Grand View Drive offers panoramic views of the Illinois River as well as historic homes, and was once dubbed the “World’s Most Beautiful Drive” by President Theodore Roosevelt.

Peoria didn’t quite make it onto Buildium’s list of up-and-coming real estate markets in 2026. The metro has seen strong multifamily cap rates and moderate rent growth. Weighing on Peoria’s score are its negative economic and employment growth. However, its affordability sets it apart—even in a region that tends to have a lower cost of living than much of the rest of the U.S.—and its home value appreciation and multifamily metrics make it worth considering for investors in 2026.

Peoria, Illinois Rental Market Statistics

• Rental Inventory (Q3-’25): 12,694
• Units Added Since Q3-’24: +234
• Asking Rent Growth Since Q3-’24: 2.3%
• Asking Rent (Q3-’25): $1,093
• Effective Rent (Q3-’25): $1,088
• Multifamily Vacancy Rate (Q3-’25): 6.7%
• Multifamily Cap Rate (Q3-’25): 8.0%

Source: National Association of Realtors

Peoria, Illinois Housing Market Statistics

• Average Home Value (Q4-’25): $126,726
• Home Value Appreciation Since Q4-’24: 8.3%

Source: Zillow

Peoria, Illinois Economic Statistics

• Population Growth (2025): 1.0%
• GDP Growth (2023): -0.8%
• Job Growth (Q3-’25): -1.3%

Source: National Association of Realtors

Lists That Mention Peoria, Illinois

• Best Real Estate Markets (WalletHub): #288

Market #5: Springfield, IL

As the state capital and a historic cornerstone of central Illinois, Springfield blends government stability, cultural heritage, and a steadily evolving local economy. Situated roughly midway between Chicago and St. Louis, the metro area offers its 205,111 residents a mix of urban amenities and small‑city livability while maintaining an affordable cost of living that stands out in today’s market.

Springfield’s economy is anchored by the state government, which provides a reliable foundation for employment and housing demand. Healthcare is another pillar of the region, supported by major institutions such as Memorial Health and HSHS St. John’s Hospital. The city also benefits from a growing service sector and a modest uptick in private‑sector job creation, helping to diversify its economic base beyond public administration. With its economy and job market making incremental gains in recent years, Springfield is gradually building momentum after a period of slower growth.

Culturally, Springfield is best known as the long-time home of Abraham Lincoln, and the city embraces this legacy through attractions like the Abraham Lincoln Presidential Library and Museum, Lincoln Home National Historic Site, and the Old State Capitol. Residents and visitors also enjoy outdoor spaces such as Washington Park, Carpenter Park Nature Preserve, and nearby Lake Springfield, which offers opportunities for boating, fishing, and lakeside recreation. Downtown revitalization efforts have added new restaurants and events, contributing to a more vibrant, walkable city center.

Springfield’s rental market is showing signs of strengthening. While it didn’t make it onto Buildium’s list of up-and-coming real estate markets in 2026, the city’s rent growth and cap rates are strong, while vacancy rates remain moderate and relatively stable. Combined with entry‑level pricing, Springfield presents a compelling opportunity for investors looking for a balanced Midwestern market with room for growth.

Springfield, Illinois Rental Market Statistics

• Rental Inventory (Q3-’25): 7,582
• Units Added Since Q3-’24: +0
• Asking Rent Growth Since Q3-’24: 9.2%
• Asking Rent (Q3-’25): $1,077
• Effective Rent (Q3-’25): $1,073
• Multifamily Vacancy Rate (Q3-’25): 6.3%
• Multifamily Cap Rate (Q3-’25): 8.4%

Source: National Association of Realtors

Springfield, Illinois Housing Market Statistics

• Average Home Value (Q4-’25): $158,546
• Home Value Appreciation Since Q4-’24: 6.8%

Source: Zillow

Springfield, Illinois Economic Statistics

• Population Growth (2025): 0.6%
• GDP Growth (2023): 0.5%
• Job Growth (Q3-’25): 1.0%

Source: National Association of Realtors

Lists That Mention Springfield, Illinois

• Best Real Estate Markets (WalletHub): #268

How Do We Identify the Best Rental Markets in Illinois?

We use the following sources to help us ascertain the best rental markets in the U.S. across five different categories.

Industry Indicators

Measures of opportunity for rental property investors and property managers:

• Markets with the best overall real estate investment prospects, as measured by PwC and the Urban Land Institute
• Housing markets with emerging investment opportunities, as measured by the Wall Street Journal and Realtor.com
• Markets with a greater number of renters relative to homeowners, as measured by the National Association of Realtors
• Markets with a high rate of renter household formation, as measured by the National Association of Realtors

Housing Indicators

Measures of property prices and rent growth:

• Markets with the highest growth in asking rents, as measured by the National Association of Realtors
• Markets with the lowest rental property vacancy rate, as measured by the National Association of Realtors
• Markets with the highest rental property cap rates, as measured by the National Association of Realtors
• Markets with the most home value appreciation, as measured by Zillow

Economic and Job Market Indicators

Measures of employment growth:

• Markets with the lowest unemployment rates, as measured by the National Association of Realtors
• Markets with the most employment growth, as measured by the National Association of Realtors
• Markets with the most GDP growth, as measured by the National Association of Realtors

Demographic Indicators

Measures of population growth:

• Markets with the greatest population growth, as measured by the U.S. Census Bureau
• The best places to live, based on analyses of quality of life and desirability, as measured by U.S. News

Climate Indicators

Measures of climate vulnerability:

• Markets with the lowest risk of natural disasters and extreme conditions, as measured by the Federal Emergency Management Agency

60 Up-and-Coming Real Estate Markets in 2026

In Buildium’s annual Up-and-Coming Real Estate Markets list, we analyzed 175 metro areas across the U.S. to determine which cities show promise for rental investors and property managers in the year ahead. View the full list of emerging markets we’ve identified across the country.