Ask a real-estate agent if it’s a good time to buy and you’ll always get the same answer: Yes! Finally, economists are saying the same thing. After seven long years of falling prices in the Chicago area—with median house values down a gut-wrenching 38 percent at the end of 2012, according to real-estate research firm Zillow—“we think Chicago has hit bottom,” says the company’s chief economist, Stan Humphries.

In fact, late last year Zillow named Chicago the best market for homebuyers among 142 metro areas. It weighed three factors: the median number of days a home spent on the market (112, in metro Chicago’s case); the percentage of homes that had their list price cut while still for sale (41 percent); and the number of homes that sold for less than their asking price (almost all of them). What’s more, with rents on the rise (up 5.3 percent last year by Zillow’s calculations), it will cost you only about half as much to own a home locally as to rent a comparable one, according to Trulia, another real-estate research firm.

The message is clear: If you’ve been waiting to invest your money in a first condo, a larger house, or a second home, “go shopping now,” advises Humphries.

How soon must you act to get the best deals? Well, nobody foresees prices skyrocketing this year in Chicago the way they are expected to in Riverside, California, and other big markets. Among other reasons, that’s because Chicago has been unusually slow to work through its pipeline of foreclosed properties and because the city’s and state’s fiscal problems have made some people leery of investing in real estate here.

For the Chicago area, the consensus 2013 home price forecast is flat to up slightly. Zillow predicts home values will neither rise nor fall. Financial services company Fiserv, using data from Case-Shiller (the gold standard in house-price number crunching), forecasts an uptick of 0.8 percent by the end of the second quarter of 2013 and another rise of 5 percent by the second quarter of 2014.

Two factors that Humphries sees driving the market higher: lower metro-area unemployment (from December 2011 to December 2012, it fell from 9.3 percent to 8.6 percent) and more investors snapping up properties to rent out, which would shrink local housing inventory.

Bottom line: This summer—when the largest number of properties typically hits the market—looks like the optimal time to buy. And if you want to snag a home that will increase substantially in value, you need to think like an investor.

Smart long-term investors don’t just grab stocks whose prices have plunged. Instead, they look for stocks with strong fundamentals—good earnings, solid growth prospects—that have also dipped low enough to be great buys.

Accordingly, look on a much-larger-than-average fall in median home prices with curiosity but caution. Of the 273 towns and neighborhoods in the charts, 106 saw drops of more than 45 percent from the peak; many of those are seriously troubled. And communities that have regained most or all of their precrash value, such as Kenwood, may be great places to live, but homes there probably aren’t great bargains.

To find the best-value neighborhoods and suburbs for first-time buyers, move-up buyers, and downsizers, I combed through places in Chicago’s six-county region where the median home price has fallen at least 35 percent from the peak. (I relaxed those restrictions for pieds-à-terre.) I then narrowed down the list by focusing on qualities likely to enhance price appreciation, including good access to transportation, shopping, and dining. The result? The 21 communities described in the pages below.