Meet the Midwest’s hottest affordable market

Rockford, IL, has had a rocky past, and the city’s mayor is the first to admit it. According to Tom McNamara, “It wasn’t that long ago we were known as the underwater mortgage capital of the US” and “the most miserable community to live in.” Since then, though, Rockford’s affordability has transformed it into one of the hottest markets in the nation. Check out just how far the city has come.

Average home price: $172,610 (up 9.5% YoY)
Homes that sell over list price: 42.9%
Homes that sell under list price: 40.0%
Average rent: $1,151/month

The pros: “Rockford offers some of the most accessible entry points in the Midwest, well below both Illinois and national medians,” says Conor Brown of the NorthWest Illinois Alliance of Realtors. “That low buy-in creates strong cash flow potential from day one.” As a result, “Investor interest has been growing from Chicagoland, drawn by easy transportation and commute access.”

The cons: Although home prices here are up nearly 10% since this time last year, “historically, appreciation has been weak,” he says. “Wealth-building here leans more on cash flow than equity growth, though that dynamic is shifting.”

His advice: “Look for value-add opportunities: The spread between purchase prices and ‘after repair values’ is one of Rockford’s biggest advantages,” Brown says. “Investors who can renovate efficiently outperform.

Case in point: Local investor Bobby Walsh recently bought a property for $40,000, poured $130k into renovations, and soon got the house under contract for $239,900—proof that investors who can flip quickly stand to make a ton of cash. Here’s more on how to pull off a fast flip.

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