Chicago Cap Rates for "3 to 4 unit" properties

[Mark Killion]

Hello Bigger Pocket members!

It has been a while since my last post on Chicago Cap Rates. 

I figured it was about time for some updated numbers. 

This post will look at Cap Rates for small multifamily properties. 

Specifically, we will look at "3 to 4" unit properties. 

The demand for smaller multifamily properties is very high. 

There is demand from both owner occupants and investors. 

Since this property type is considered Residential, 

there is ample financing available. 

This drives up demand and prices, while compressing cap rates. 

This is for the 12 month period ending Feb 17, 2021.

The cap rates were estimated and derived based on the following assumptions:

1) Net Income will be 50% of listed Gross Income.

Below you will find Chicago Cap Rates by neighborhood.

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• ALBANY PARK : 4.88
  ASHBURN : 5.98
  AUBURN GRESHAM : 7.03
  AUSTIN : 6.03
  AVONDALE : 4.32
  BELMONT CRAGIN : 4.96
  BEVERLY : 4.39
  BRIDGEPORT : 4.22
  BRIGHTON PARK : 5.96
  CHATHAM : 6.61
  CHICAGO LAWN : 6.5
  CLEARING : 5.01
  DOUGLAS : 4.48
  DUNNING : 4.17
  EAST GARFIELD PARK : 5.72
  EAST SIDE : 5.38
  EDGEWATER : 4.09
  EDISON PARK : 4.12
  ENGLEWOOD : 8.98
  FOREST GLEN : 3.85
  GAGE PARK : 6.09
  GARFIELD RIDGE : 4.43
  GRAND BOULEVARD : 4.81
  GREATER GRAND CROSSING : 5.92
  HERMOSA : 4.54
  HUMBOLDT PARK : 5.47
  IRVING PARK : 4.12
  JEFFERSON PARK : 4.23
  KENWOOD : 4.44
  LAKE VIEW : 4.15
  LINCOLN PARK : 4.27
  LINCOLN SQUARE : 4.08
  LOGAN SQUARE : 4.19
  LOWER WEST SIDE : 4.45
  MCKINLEY PARK : 4.44
  MORGAN PARK : 5.94
  NEAR NORTH SIDE : 4.37
  NEAR WEST SIDE : 4.64
  NEW CITY : 6.93
  NORTH CENTER : 4.28
  NORTH LAWNDALE : 6.52
  NORTH PARK : 5.15
  NORWOOD PARK : 4.59
  O’HARE : 3.55
  PORTAGE PARK : 4.47
  PULLMAN : 7.38
  ROGERS PARK : 4.9
  ROSELAND : 7.62
  SOUTH CHICAGO : 8.51
  SOUTH DEERING : 16.58 * (only 1 property sold, so this could be an anomaly)
  SOUTH LAWNDALE : 5.65
  SOUTH SHORE : 5.88
  UPTOWN : 3.97
  WASHINGTON HEIGHTS : 5.89
  WASHINGTON PARK : 5.11
  WEST ENGLEWOOD : 8.09
  WEST GARFIELD PARK : 9.11
  WEST LAWN : 4.82
  WEST PULLMAN : 9.93
  WEST RIDGE : 4.38
  WEST TOWN : 4.08
  WOODLAWN : 6.02