What New Research Reveals About Chicago’s Homeownership Gap

Chicago thrives when residents feel they can make a home here, put down roots, and invest in their future and their community.

In a new research brief, “Credit Ready But Priced Out: Chicago’s Homeownership Affordability Gap by Neighborhood,” Financial Health Network researchers Necati Celik and Amber Jackson explore some of the financial reasons why more renters are not becoming homeowners. Drawing on credit data from TransUnion and the Financial Health Network 2025 Chicago Trends Report, the brief follows renters across the city from 2022 to 2025. The authors find that even when Chicagoans want to own homes and are credit ready, only a small share became homeowners (8.2%) during that time period.

Recognizing that homeownership is a key pathway to financial security as well as a driver of community stability, identifying the factors that limit its feasibility in Chicago is critical. This report sheds light on some of the factors influencing the transition from renter to homeowner, highlighting credit readiness. Three findings from the report are especially relevant to the Trust’s work to advance economic mobility and increase neighborhood stability through affordable homeownership.

Credit Readiness Varies by Where You Live and What You Owe

More than two-thirds of Chicago renters want to become homeowners, but only about 1 in 4 renters on the South and Far South sides are considered credit-ready for a mortgage, compared to more than half of renters on the North Side. After the pandemic-era pause on federal student loan payments ended in 2023, more than a third of credit-ready renters with open student loans lost their credit-ready status by 2025, a sign that rising costs and education debt may be pulling renters further from ownership.

Low Mortgage Inquiry and Approval Rates Point to Factors Beyond Credit Readiness

Across the city, less than a third of credit-ready renters made a mortgage inquiry between 2022 and 2025. Of those who made an inquiry, between 35% and 62% went on to purchase a home, with those in the North and Central areas of the city being significantly more likely to obtain a mortgage loan. But credit readiness only tells part of the story. We know that other factors, such as income to cover rising costs and savings for a down payment, as well as inflated home prices, play important roles in whether someone is successful in obtaining a mortgage loan.

Affordability Is the Biggest Barrier

Even credit-ready renters often can’t afford what’s for sale. Fewer than 1 in 7 credit-ready renters across the city can afford a home priced above $200,000. Meanwhile, Chicago’s citywide median home price climbed to nearly $400,000 in 2026, meaning the true affordability gap is even wider today than the 2025 data show.

Where new owners end up buying begins to tell a related story. South and Far South Side buyers were the most likely to purchase in the same neighborhoods where they’d been renting. Fifty percent of North Side, Northwest Side, and West Side renters left the city to move either to suburban Cook County or outside of the Chicago region. Renters on the West Side left Cook County at the highest rate of any group. While this research doesn’t answer the question of why people choose to buy where they did, the data shows that most households can’t afford to buy in Chicago.

Building Pathways to Homeownership

Addressing barriers to homeownership for renters who want to and may be financially ready to own is a key factor in supporting the region’s economic vitality and population stability. The Trust is working with partners across the city to advance lower-cost and more abundant housing options. We are:

• Investing in financial coaching and credit-building for City Colleges of Chicago students, workforce program participants, and low-income renters, alongside employer partnerships through the Chicagoland Workforce Funders Alliance that connect Chicagoans to higher wages and workplace savings tools.
• Expanding mortgage access through the Home Lending Partnership initiative to design and offer mortgage products for renters who might otherwise be shut out of homeownership, and through neighborhood-based lending and housing development models like the Connecting Capital and Community (3C) initiative, which is increasing access to homeownership in Humboldt Park and East Garfield Park.
• Tackling the shortage of affordable homes for sale by backing Reclaiming Chicago’s plan to build 2,000 affordable homes on the South and West sides, supporting shared-ownership models that lower the cost of homeownership, and advocating for faster, less costly review and permitting processes for new housing construction, including modular building techniques.

None of these are quick fixes. But with Chicago facing an affordable housing shortage measured in the tens of thousands of homes, closing the homeownership gap will take sustained, coordinated investment — in renters’ financial health today, and in the housing stock the region needs today and in the future.