Investing In State vs. Out of State (Chicagoland Area)

[Sarah Patel]

Hello! I am new to the REI world and my husband and I's goal is to invest in a property by the end of the year and use as a STR. We live in the western suburbs of Chicago and have been weighing the pros and cons of investing in-state vs. out of state. While the current suburb we live in (Elmhurst) seems to be appreciating very well and surrounding comps support list to price ratios of 90% and up, we aren't sure if it's the best market for a STR (perhaps a flip).

While there may be better deals out of state, we worry that out of state investing may be too much for us  to handle as our first property. I say this because we have a toddler and have another on the way and both of us work W2s. I work 40hrs/week while my husband works anywhere from 50-90hrs/week. Do people still invest out of state in our situation? Sure! And they have my utmost respect. I'm just not sure how feasible it is for us personally. That doesn't mean we aren't open to investing out of state further down the line. I'm just wondering if investing locally makes any sense. Of note, we would use our realtor who helps us purchase our current home, already have some contractor contacts, repairmen, etc- making our core 4 already in place here. Our ultimate goal (as is anyone else's) is to be able to scale back our time at our W2s and replace that with income from real estate. We know that's not going to come with the first property but want to give ourselves the best opportunity to learn we can. 

Bottom line: anyone who has recently invested in the Chicagoland area think that there's still plenty of opportunity here? Or would you argue that the additional challenges that come with out of state investing are worth the potential of a better ROI? We are also hesitant about timing and whether or not to wait and see if the current administration actually restores the TCJA full bonus depreciation provision.

Any feedback/input is welcome. Thanks for reading! Excited to be here and learn. 

[Melissa Justice]

Hey @Sarah Patel,

Welcome to the BP community!

First of all—kudos to you both for even thinking long-term and strategically while juggling family and demanding W2 jobs. That mindset puts you ahead of the game. Now, to your question: Is it worth investing out of state if you’re new and busy with life? The short answer is: Yes — if you go turnkey.

Given your situation — full-time work, toddler, another baby on the way — trying to self-manage a short-term rental, especially in a heavily regulated area like Chicagoland, can quickly become overwhelming. That’s where turnkey properties come in. These are fully renovated, professionally managed rentals that are ready to go from day one. You buy it, and the cash flow starts while your life goes on.

How Turnkey Investing Solves Your Concerns -
Hands-off management: You get property management built in — no coordinating repairs or finding tenants.

Remote-friendly: You don’t have to visit the property to manage it. Everything can be handled digitally with regular updates from your team.

Done-for-you team: The “core four” (realtor, contractor, PM, lender) is already in place.

Cash flow from day one: Many turnkey providers focus on cash-flowing markets where returns are stronger than high-cost areas like Chicago.

More scalable: Once you own your first turnkey rental and see it working, you can repeat the process with confidence — even while raising a family.

If you’re thinking of investing out of state, markets like:

South Bend, IN (just a short drive from you)

Memphis, TN

Akron, OH

Locust Grove, GA

These areas are popular among investors for their affordability, stable rental demand, and landlord-friendly laws — and turnkey providers are already active there.

Short-term rentals (STRs) sound exciting, but they require constant attention, reviews, guest communication, pricing adjustments, etc. That’s a part-time job on its own. With turnkeys, you start with long-term tenants, professional management, and passive income — which seems like a better fit for your stage of life.

You're absolutely right to be thinking about tax strategy. If the bonus depreciation changes return under the current administration, it could enhance the upfront tax benefits on new acquisitions — especially on turnkey new construction or rehabbed properties where cost segregation can apply. Let me know if you want to discuss more in depth!

Wishing you much success!

Melissa Justice

Investment Strategist at Rent to Retirement