A studio apartment in Edgewater that once rented for $900 now costs at least $1,500, even without updates. Across Chicago, renters are facing steep increases as rents outpace wage growth, forcing many long-term residents to reconsider where – or if – they can afford to live in the city.
“Affordable for a studio used to be $600 or $700,” says Kirk Hudson, a broker associate with Baird & Warner who handles dozens of rental deals each month. “Now affordable is $1,200 or $1,300, and there’s almost nothing at that price.”
Rising property taxes are reshaping Chicago’s rental market, the influence of corporate landlords, and a pricing structure that increasingly excludes middle-income tenants.
Renter Realities
Hudson works with six to ten renters each month. Today, only about half can secure a lease because most available units are now out of reach. Studios that once rented for under $1,000 are routinely listed at $1,500 or more. One-bedroom apartments that cost $1,200 a few years ago now approach or exceed $2,000 in many popular neighborhoods.
The issue isn’t a lack of listings – it’s that most available units are priced above what typical renters can afford. “It’s not like there’s no property on the market,” Hudson says. “It’s that what’s there isn’t worth the money they’re asking.”
This dynamic has made it harder for renters to save for a down payment or transition to homeownership. What once felt like a stepping stone now feels like a treadmill, with rising rents making it nearly impossible to get ahead.
Three Forces Behind Chicago’s Rent Spike
Several converging factors have driven up Chicago rents by 70% over five years, and none show signs of reversing.
Property Taxes Passed to Tenants
Cook County reassesses property taxes every three years. The most recent reassessment led to significant tax increases for many landlords, who in turn raised rents to cover the higher bills. Most landlords do not have the financial cushion to absorb these increases and instead pass them directly to tenants.
“Most landlords in Chicago are running it as a business, not for the sake of provision,” Hudson explains. “So when taxes jump, renters pay the price.”
Artificially Inflated Home Values
Between 2021 and 2024, bidding wars and limited inventory drove home and condo prices sharply higher. Many of these purchased units were converted to rentals, with landlords setting rents based on their elevated purchase prices rather than on local affordability.
“There was a lot of artificial cash inflation of property value,” Hudson says. “Now renters are paying for that.”
Corporate Landlords Changing the Market
Large investment companies have purchased entire buildings and blocks of units in neighborhoods once dominated by individual owners. These corporate landlords set rents according to profit models, not local incomes, which pushes prices higher across the market.
“It’s not just private landlords trying to make a living,” Hudson says. “It’s large conglomerate companies monopolizing the market.”
Impact on Renters and Would-Be Buyers
For renters, these trends mean fewer affordable options and longer rental tenures. Many who planned to rent for a year or two before buying are now stuck leasing longer because high rents make saving for a down payment nearly impossible.
“A lot of my renters become my buyers,” Hudson says. “But if we can’t get a successful rental deal done first, it’s harder to maintain that relationship and turn them into a buyer later.”
For buyers, there is some relief. Home prices in Chicago are beginning to stabilize after years of rapid gains. Mortgage rates have dipped below 6%, making homeownership more feasible for those who can secure a down payment.
“If you’re paying $2,000 a month in rent, you’re paying someone else’s mortgage,” Hudson says. “You might be able to own for the same monthly cost – or less.”
Why This Matters Now
Chicago has long been known as one of the more affordable major U.S. cities, but that reputation is eroding. The gap between what renters earn and what they are expected to pay has widened rapidly since the pandemic. Without policy changes, increased housing construction, or a shift in landlord practices, the rental market will continue to push out those who have historically made up the city’s backbone.
Renters are responding by moving to less popular neighborhoods, seeking roommates, or trying to buy sooner than planned – sometimes out of frustration rather than readiness.
“Renting is supposed to be your first independent space until you’re ready to own,” Hudson says. “It’s becoming much harder to live independently and comfortably within your means just to have a roof over your head.”
Looking Ahead
The sharp rise in rents has altered the path to homeownership and is reshaping Chicago’s neighborhoods. As affordability declines, the city risks losing residents who would otherwise build roots and contribute to its long-term vitality.
If current trends persist, more renters will be forced into difficult choices – stretching their budgets, compromising on location or quality, or leaving Chicago altogether. The future of the city’s rental market will depend on whether new solutions emerge to address the widening gap between incomes and housing costs.
This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.
About the Expert: Kirk Hudson is a broker associate with Baird & Warner in Chicago, specializing in first-time home buyers, rental transactions, and LGBTQ+ community representation. He completes more than 70 transactions annually, ranking in the top 1% of his company.
