How to Invest in Illinois Land in Today’s 2026 Market

Illinois remains one of the Midwest’s most strategic land markets because it blends world-class logistics, deep agricultural productivity, and durable demand for housing in and around major employment centers. Investors can still find opportunity across the state’s varied geography—whether you’re targeting exurban development tracts near the Chicago metro or income-producing rural acreage in the heart of the Corn Belt.

Below is a practical, up-to-date framework for investing in Illinois land: what’s driving values, where to focus, how to underwrite, and which exit paths to plan before you buy.

Understand the Big Drivers Behind Illinois Land Values

Before you narrow into a county or a parcel, start with statewide valuation signals—especially in farmland, where Illinois has unusually strong long-run pricing data.

Illinois farmland values: current level and long-term trend

• Illinois average farm real estate value reached $8,930 per acre in 2025, a 2.6% increase from $8,700 per acre in 2024, according to University of Illinois Farm Doc Daily.
• Over the last decade, Illinois farm real estate values increased 22%, rising from $7,300 per acre in 2016 to $8,930 per acre in 2025, per University of Illinois Farm Doc Daily.
• Since 2020, Illinois recorded five consecutive years of at least 2.4% annual increases in farm real estate values, averaging 4.7% per year across that period, according to University of Illinois Farm Doc Daily.
• Illinois cropland values have increased by nearly 6% annually since 2000, climbing from $2,350 per acre (2000) to $9,850 per acre (2025), per University of Illinois Farm Doc Daily.

How Illinois compares to other Corn Belt states

Relative positioning matters when you’re benchmarking what “fair value” looks like for high-quality Midwest ground. In 2025, among Corn Belt states, Iowa led at $9,790 per acre, Ohio followed at $9,350 per acre, and Illinois ranked third at $8,930 per acre, according to University of Illinois Farm Doc Daily.

Why “strong statewide averages” still require local caution

Even in a resilient market, land pricing is local. In Farm Credit Illinois’ 2025 benchmark study, farmland values in central and southern Illinois decreased 4.41% in 2025—the first decline since 2018, according to Farm Credit Illinois. That same study found that 14 of 22 tracked farms decreased in value, with year-over-year changes ranging from -13.64% to +27.39% depending on location and land class, per Farm Credit Illinois.

Cash flow inputs can shift, too. Cash rents in Illinois slightly decreased for the 2025 crop year after several years of increases, reflecting lower commodity prices and reduced net farm incomes, according to Farm Credit Illinois.

Choose the Right Illinois Land Investment Target (By Strategy)

Illinois offers two primary land investor paths: (1) development-oriented land near expanding metro edges and (2) productive farmland positioned for income, inflation protection, and long-term appreciation. Your best “buy box” should match your time horizon, risk tolerance, and operational capacity.

1) Chicago-area exurban and “collar county” development land

Chicagoland’s employment base, infrastructure, and commuter patterns keep land demand persistent—but competition for lots inside Cook County often puts smaller buyers at a disadvantage. Many investors instead focus on collar counties where infrastructure improvements and commuting access can translate into steady absorption as growth moves outward.

Practical underwriting note: prioritize parcels with clean entitlements, road access, and zoning paths that support your intended density. If you’re buying purely on speculation, insist on a margin of safety in your per-acre basis.

Target entry land pricing (guideline): $15,000–$25,000 per acre

2) Central Illinois farmland with durable agronomic demand

Central Illinois counties remain a core U.S. grain-production region, which supports long-run institutional and operator demand. At the same time, recent data reinforces the need for disciplined underwriting: local valuations can dip even when statewide averages hold steady, and cash rents can soften when commodity prices fall.

To anchor your expectations in current market reality, note that Illinois average farm real estate value was $8,930 per acre in 2025, up 2.6% from $8,700 in 2024, per University of Illinois Farm Doc Daily. Over longer holding periods, Illinois cropland values rose from $2,350 per acre in 2000 to $9,850 per acre in 2025—nearly 6% annual growth—according to University of Illinois Farm Doc Daily.

Target entry land pricing (guideline): $7,500–$12,000 per acre

Run Due Diligence That Matches the Land’s End Use

Land looks simple until it isn’t. Your due diligence should confirm the parcel can actually execute your plan—whether that plan is development, long-term hold, or leased farming income.

Development land due diligence checklist

• Order surveys and confirm floodplain and wetland constraints before you price the deal.
• Validate soil and drainage conditions for foundations and on-site systems (where applicable).
• Verify zoning, setbacks, and density allowances—and map a realistic path to approvals.
• Confirm access, frontage, and utility adjacency; estimate extension costs early.

Farmland due diligence checklist

• Review soil productivity indices and field layout (tile, waterways, terraces, and erosion risks).
• Check conservation program participation and eligibility to understand income and restrictions.
• Confirm drainage district requirements and water-related obligations or disputes.
• Underwrite to realistic rent expectations, especially in years when rents soften (cash rents slightly decreased for the 2025 crop year after prior increases, per Farm Credit Illinois).

Set Conservative Per-Acre Buy Targets (and Account for Rising Ownership Costs)

Winning land investments often come down to one decision: what you pay. A conservative basis protects you if local values drift lower—even in a state where farm real estate values have posted five straight years of at least 2.4% annual increases since 2020, averaging 4.7% per year, according to University of Illinois Farm Doc Daily.

Why ownership costs matter as much as purchase price

In Illinois, carrying costs can rise steadily over time, which directly impacts your net yield. In central Illinois, average farmland real estate taxes increased from $33 per owned acre in 2000 to nearly $76 per owned acre in 2024, an average annual increase of 3.5%, per University of Illinois Farm Doc Daily. Over that same window, economic ownership costs on farmland in central Illinois increased from $108 per owned acre in 2000 to over $270 per owned acre in 2024, averaging 3.9% annually, according to University of Illinois Farm Doc Daily.

Those trends are exactly why you should avoid “perfect-case” underwriting and instead buy with enough cushion to hold through cycles.

Suggested maximum per-acre valuation guidelines

Use these as starting points, then adjust for location, access, zoning, soil quality, and comps:

• Exurban development parcels: $20,000/acre or below in Chicago metro northern counties; $15,000/acre or below around many downstate secondary-city corridors.
• Productive farmland: $12,500/acre and below for many Central/Northern Illinois tillable tracts; $10,000/acre and below for many Southern Illinois ag holdings.

For buyers sourcing opportunities online or through direct outreach, you can review deal flow and market context for Illinois in this guide: Illinois land deals.

Plan Exit Strategies Before You Close

Land is illiquid by nature, so you should decide how you’ll create liquidity before you buy. Your optimal exit will depend on entitlement progress, market timing, and your tax strategy.

Development land exits

• Subdivision strategy: split larger parcels into smaller lots that appeal to custom-home buyers, often improving price-per-acre economics.
• Entitle and improve: add access roads and coordinate utilities where feasible, then sell “shovel-ready” parcels to builders at a higher valuation.
• Long-hold plus tax strategy: hold through area buildout and evaluate a 1031 exchange into the next acquisition; see additional context here: land deals.

Farmland exits and return paths

• Income-first hold: lease ground to operators for annual cash rent; revisit rent assumptions when commodity cycles weaken (cash rents slightly decreased for the 2025 crop year, per Farm Credit Illinois).
• Cycle-aware sale: sell into periods of strong local demand or commodity-driven optimism. Keep in mind that local outcomes vary widely: Farm Credit Illinois observed year-over-year changes from -13.64% to +27.39% by location and land class in 2025, per Farm Credit Illinois.

Frequently Asked Questions (FAQs)

What transaction fees should I budget when buying vacant land in Illinois?

Budget roughly 1%–3% of the purchase price for typical closing costs, which may include title work, recording fees, legal filings, transfer taxes (where applicable), and lender fees if you finance.

What returns do Illinois land investors typically target?

Return targets vary by strategy. Development land investors often underwrite primarily to appreciation driven by entitlements and nearby growth. Farmland investors typically combine annual lease income with long-term appreciation—while also accounting for rising tax and ownership costs (for example, central Illinois farmland real estate taxes rose from $33 per acre in 2000 to nearly $76 in 2024, per University of Illinois Farm Doc Daily).

How should I think about “statewide averages” versus what I’ll pay for a specific farm?

Use statewide averages as context, not as a comp. Illinois averaged $8,930 per acre in 2025, up 2.6% from 2024, per University of Illinois Farm Doc Daily, but local conditions can still decline—central and southern Illinois decreased 4.41% in 2025 in Farm Credit Illinois’ benchmark study, per Farm Credit Illinois.

Is Illinois still competitive compared with other Corn Belt states?

Yes. In 2025, Iowa led Corn Belt states at $9,790 per acre, Ohio was $9,350, and Illinois ranked third at $8,930, according to University of Illinois Farm Doc Daily. That relative pricing can help investors benchmark value, especially when comparing soil quality, taxes, and rent potential across state lines.

What due diligence matters most for farmland in today’s market?

Prioritize soil quality, drainage, field conditions, and lease economics—and model expenses realistically. Ownership costs have risen meaningfully over time; for example, central Illinois economic ownership costs increased from $108 per acre in 2000 to over $270 in 2024, per University of Illinois Farm Doc Daily.

Illinois land can serve as a long-duration, real-asset allocation with multiple ways to win—development upside near growth corridors, or steady agricultural value supported by long-run appreciation trends. The investors who perform best pair patient holding periods with strict due diligence and disciplined per-acre entry pricing.