Multi-Family Investing in a New City - Chicago

Real Estate Broker · Chicago, IL · Member since 2018 · 33 posts · 25 votes

@Del Kirksey I live in Bridgeport, one of my favorite neighborhoods in Chicago. If you are looking for a 2 flat with 2 to 3 beds per unit your median price will be around 315K, depending on how much sweat equity you are looking to put in, 2 flats range from 200k up to 450K +plus. Rents in the area are around $800-$1200 for a 1 bedroom. If you need any assistance feel free to PM. Chicago is a great city, and summer is the best time so enjoy.

3 Reply

Ibn Abney

Rental Property Investor · Chicago, IL · Member since 2016 · 318 posts · 307 votes

@Del Kirksey Welcome!!

I would suggest renting for 6months to a year to learn the market and areas. All the areas you mention are great place to live. I would throw in Bronzeville, woodlawn, and kenwood as well to consider. Close to the train and easy access to downtown.

Also, as time pass you can save more. ideally $275k-$450k is ideal for a 2-3flat. In Brighton Park you may be able to find 2 flats under $250K. that is alittle more SW of bridgeport area

Good Luck!

3 Reply

Del Kirksey

OP

Chicago, IL · Member since 2019 · 5 posts · 2 votes

Thanks @Scott Passman

@Matthew McMahon, @Ibn Abney thanks to you two as well. Would you guys say that the $200K+ range is specific to certain neighborhoods or is that pretty much city-wide?

Asking because the barrier to entry here in Cincinnati is much lower at the moment, I can get a livable 2-unit for around $75k-$100k in a decent area and add value quickly. Moving up to that range may derail my goal of investing in real estate for much longer than I would have imagined. Am I being unrealistic if I expect to get started in the city with about $17-$20k? or is it just a matter of me becoming more creative to get where I want to be?

Also, @Ibn that is my intention at the moment. To rent a place for the short-term until I can have a better look at the market once I'm actually in the city.

Thanks for the advice guys.

Real Estate Broker · Chicago, IL · Member since 2018 · 33 posts · 25 votes

@Del Kirksey There are 77 different neighborhoods in Chicago, all of which are different price points. With that being said, certain areas of the city are somewhat similar in price point. You definitely have options with 20k to invest in the city, you're best bet is speak to with a few mortgage brokers first to get pre approved. I'm not a mortgage broker, but there are several options, allowing you to put down as little as 3.5%-5%.

2 Reply

Del Kirksey

OP

Chicago, IL · Member since 2019 · 5 posts · 2 votes

Thanks again @Matthew McMahon, I've already been pre-approved for up to $300k here in Cincinnati. Not sure if that is a nationwide pre-approval but it seems like it should be. I guess I have some research to do on the different neighborhoods.

I'd just really like to avoid buying a home in a nightmare neighborhood just because it matched my price point.

Real Estate Broker · Chicago, IL · Member since 2018 · 33 posts · 25 votes

@Del Kirksey Any help you need regarding neighborhood market trends, rental options, or REI contacts, i.e. mortgage brokers, contractors, attorneys, etc. feel free to message me. Also with a pre approval for 300k you have options with investing in Chicago real estate. Good luck

1 Reply

Michael Facchini

Lender · Chicago, IL · Member since 2017 · 438 posts · 193 votes

@Del Kirksey, welcome to Chicago (or soon at least!). I agree with the idea of maybe renting for 6 months to get a sense of the different neighborhoods. They all have their own feel, different access, and of course varying price points. There are a ton of great neighborhoods along various L lines that can get you into the loop. Might be good to get a sense of areas you like, narrow down the search, and then take your time in finding the right place...since this will be your primary residence and likely a long-term investment. I'd highly recommend reaching out to @Weston Harding and his team at X Plus Real Estate. They are the #1 sellers of 2-6 units in Chicagoland, and outside of knowing a ton about this property type, they know Chicago inside and out and have their finger on the pulse.

2 Reply

Jeff Burdick

Investor · Chicago, IL · Member since 2016 · 515 posts · 247 votes

Originally posted by @Del Kirksey:

Hey BP,

My name is Del and this is my first official post on BP. I started my RE journey a few months back after spending some time on BP and reading books to educate myself on best practices. Ultimately, all signs pointed to "just get started" so here I am. A few months ago I hired an agent and we've been in and out of contracts here in Cincinnati, Ohio, where I've lived for 8 years now however I just received news that I will be moving to Chicago with my job in the next two months.

I know nothing about Chicago outside of Downtown which I've visited a few times. Would anyone have any advice or resources on getting started in a new city if my goal is to owner occupy a multi-unit dwelling (budget: ~175k)? I will be working in the loop so my main thing is being near public transit wherever I live. I also plan to find short-term housing, possibly with a roommate, somewhere until I'm comfortable jumping into the Chicago market.

Areas I've investigated so far just via hearsay on here and other forums: Oak Park, Pilsen, Marshal, Mckinley Park, Bridgeport

Again, I am completely new to the market so any advice is appreciated,

Del

Welcome Del. A multi-family close to the Loop on a 175K budget won't be super easy, but two areas that I love that fit your criteria are Brighton Park and Gage Park. Depending on how close you are to the train stop, its roughly a 30-40 minute commute to the loop door to door.

Jeff Burdick

Investor · Chicago, IL · Member since 2016 · 515 posts · 247 votes

Originally posted by @Del Kirksey:

Thanks @Scott Passman

@Matthew McMahon, @Ibn Abney thanks to you two as well. Would you guys say that the $200K+ range is specific to certain neighborhoods or is that pretty much city-wide?

Asking because the barrier to entry here in Cincinnati is much lower at the moment, I can get a livable 2-unit for around $75k-$100k in a decent area and add value quickly. Moving up to that range may derail my goal of investing in real estate for much longer than I would have imagined. Am I being unrealistic if I expect to get started in the city with about $17-$20k? or is it just a matter of me becoming more creative to get where I want to be?

Also, @Ibn that is my intention at the moment. To rent a place for the short-term until I can have a better look at the market once I'm actually in the city.

Thanks for the advice guys.

Things vary vastly in Chicago...neighborhood by neighborhood and in many cases, even block by block. There are neighborhoods where there are beautiful gray stones boarded up and vacant. And neighborhoods where tear downs sell for 500K. There is essentially nothing that is 'city wide' in terms of real estate prices in Chicago.

Real Estate Broker · Chicago, IL · Member since 2018 · 33 posts · 25 votes

@Jeff Burdick

Each neighborhood has a different price range for multi units. Check out @Ibn Abney post on his south side Chicago BRRRR property, he completed the whole project for 58K. You have many different options here

Del Kirksey

OP

Chicago, IL · Member since 2019 · 5 posts · 2 votes

Thanks @Michael Facchini, that's my plan and I appreciate the referral.

Thanks @Jeff Burdick, I'll look into those areas.

I definitely plan to rent for a few months before I jump in.