Prices don’t make sense in Chicago?

Member since 2021 · 10 posts · 7 votes

Has anyone found where prices for multi family buildings make sense around Chicago? When I look at rent prices versus mortgage, taxes, utilities, multi families are priced so fixed monthly costs are higher then the rents. Or you'd be making $0 monthly with 20% down. Am I looking at this wrong or am I looking into wrong places?

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John Warren

Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes

@Account Closed this is undoubtedly one of the most challenging times since I got my license for investors to enter the market. There definitely are still deals, but they tend to go to the more full-time folks who have the knowledge and experience. With that said, I am a big believer in buying in your back yard. Where do you live now? Focus there and double down. I wouldn't spread out to a new part of the city or suburbs where you don't know the area.

I most recently purchased a building in Berwyn in 2024 and now a value-add deal in Cicero in 2025. I have stayed in the same areas where I started so my local market knowledge continued to improve, and my competitive advantage stays strong.

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Benjamin AakerPro Member
Rental Property Investor · Brandon, SD · Member since 2015 · 1k+ posts · 1k+ votes
1y
I don't know Chicago well, but many areas suffer from this similar situation. Sellers are still valuing their properties too high for the market. The expectation is that you will be able to put more money down to make it cash flow, but that kills your cash-on-cash return. It's a symptom of the easy money that was flowing into real estate around COVID times. There are still deals to be had, even in Chicago, I suspect. You'll have to keep looking and look for more value-adds.
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- Account Closed
  OP
  Member since 2021 · 10 posts · 7 votes
  1y
  @Benjamin Aaker very much so. Cheap money really distorted everything and I am not sure how much longer this can go on for. Huge segment of the population is priced out buying.
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John Clark
Member since 2018 · 1k+ posts · 1k+ votes
1y
Quote from @Account Closed:

Has anyone found where prices for multi family buildings make sense around Chicago? When I look at rent prices versus mortgage, taxes, utilities, multi families are priced so fixed monthly costs are higher than the rents. Or you'd be making $0 monthly with 20% down. Am I looking at this wrong or am I looking into wrong places?
Where are you looking?

southwest side is okay, near the orange line. Anything on the North side is $100k more than south side
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- Account Closed
  OP
  Member since 2021 · 10 posts · 7 votes
  1y
  @John Clark for multifamily I've been looking around Humboldt Park primarily, Avondale, west Logan Square, Ukrainian Village areas. I might have to explore that area as well but I am not super familiar with it. Also I've been exploring SW suburbs possibly around Orland Park. Any suggestions are more than welcome. I can't get the numbers to even remotely make sense on properties offered.
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- John Clark
  Member since 2018 · 1k+ posts · 1k+ votes
  1y
  Quote from @Account Closed:
  
  @John Clark for multifamily I've been looking around Humboldt Park primarily, Avondale, west Logan Square, Ukrainian Village areas. I might have to explore that area as well but I am not super familiar with it. Also I've been exploring SW suburbs possibly around Orland Park. Any suggestions are more than welcome. I can't get the numbers to even remotely make sense on properties offered.
  North side areas you're looking at are gentrified. Orland Park has some serious money in it. Like I said, follow the Orange Line. Archer Heights, West Elsdon, West Lawn, are decent areas. Also check out the Green Line's stops. If you can buy and hold for a while, consider the far South side Red Line extension.
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Tj FlorosPro Member
Real Estate Agent · Chicago · Member since 2025 · 95 posts · 74 votes
1y
Quote from @Account Closed:

Has anyone found where prices for multi family buildings make sense around Chicago? When I look at rent prices versus mortgage, taxes, utilities, multi families are priced so fixed monthly costs are higher then the rents. Or you'd be making $0 monthly with 20% down. Am I looking at this wrong or am I looking into wrong places?

Hey Boris,
Are you looking to buy as a straight up investment or are you looking to house hack? Right now when I work with buyers who are looking to house hack we aim for getting someone into a building and living below market rent, which will eventually cash flow post move out. Humboldt, Avondale, west logan and Uk already has a lot of people looking in those or have bought in those over the year. I myself have house hacked in logan and the building is finally cash flowing since buying in 2022. Alot of times you have to target value add, remodel and increase the rents to get deals to make sense. Given the high rates right now alot of deals wont pencil off the MLS unless you are adding value somehow and are ok with the building not cash flowing year 1 or 2.
Right now its a challenge just getting my buyers offers accepted when looking to house hack in those areas, low inventory is making most properties go above asking price and everything is getting multiple offers.
Depending on what your plan is 20% down or house hack I would target areas that are still "up and coming" and also hire a good property tax attorney to help keep your taxes some what low.
[email protected]
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Marcelo SztainbergPro Member
Northbrook, IL · Member since 2022 · 9 posts · 3 votes
1y
Boris, I've been focusing on small multifamilies (2-4) so far. Found a few deals in the north west side, Rogers Park area. It's on the upside and found properties with either below market tenants or in need of repairs. While a lot of deals are going above ask, there are still many that make sense. Staying on the small side takes multiple larger investors away. It's probably the same if you look west. The south side is probably the best bet, but I'm staying away as it is very "random" from block to block in terms of safety.
I'd be happy to connect and share ideas.
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Eudith VacioPro Member
Real Estate Agent · Chicago & NWI · Member since 2015 · 860 posts · 521 votes
1y
Hey @Account Closed 👋🏽
Prices in Chicago have definitely risen over the past few years, but we're still not as high as some other areas. It is VERY difficult to cash flow in the northside, most deals don't make sense there unless you're trying to house-hack and wait to gain appreciation.
However, the south side of Chicago is very different. It is a better market to cash flow in and deals make more sense there especially if you're putting such a high downpayment like 20%. Area's like McKinley Park, Brighton Park, Chicago Lawn, etc. are higher cashflow markets. If you're willing to do some work, then even better because you can buy a property below market value. You're also in prime selling season which typically means higher prices. I usually like looking during the fall / winter when everyone goes into hiding and negotiate better deals!
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Eudith VacioPro Member
Real Estate Agent · Chicago & NWI · Member since 2015 · 860 posts · 521 votes
1y
Agree with @John Clark!
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John Warren
Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
1y
@Account Closed this is undoubtedly one of the most challenging times since I got my license for investors to enter the market. There definitely are still deals, but they tend to go to the more full-time folks who have the knowledge and experience. With that said, I am a big believer in buying in your back yard. Where do you live now? Focus there and double down. I wouldn't spread out to a new part of the city or suburbs where you don't know the area.
I most recently purchased a building in Berwyn in 2024 and now a value-add deal in Cicero in 2025. I have stayed in the same areas where I started so my local market knowledge continued to improve, and my competitive advantage stays strong.
3 Reply
- Sean McKee
  Rental Property Investor · Chicago, IL · Member since 2017 · 268 posts · 189 votes
  1y
  Quote from @John Warren:
  
  @Account Closed this is undoubtedly one of the most challenging times since I got my license for investors to enter the market. There definitely are still deals, but they tend to go to the more full-time folks who have the knowledge and experience. With that said, I am a big believer in buying in your back yard. Where do you live now? Focus there and double down. I wouldn't spread out to a new part of the city or suburbs where you don't know the area.
  I most recently purchased a building in Berwyn in 2024 and now a value-add deal in Cicero in 2025. I have stayed in the same areas where I started so my local market knowledge continued to improve, and my competitive advantage stays strong.
  
  John are you finding cash flow in Berwyn/Cicero?
  0 Reply
Jonathan KlemmBusiness Member
Moderator
Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
1y
A lot of prices don't make sense anywhere @Account Closed! Are you looking for a pure cash flow play or a neighborhood with more appreciation potential?
Chicago is such a vast area that you have to get very granular and figure out precisely what you want! Then, after you know the exact numbers, you can find the right neighborhood where you can hit those numbers.
Often, when you're getting started, the key is getting the ball rolling, even if it's not a perfect deal. Happy to connect and talk about how to get the ball rolling!
[email protected]
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Paul De Luca
Real Estate Agent · Chicago, IL · Member since 2018 · 1k+ posts · 1k+ votes
1y
@Account Closed
This is just the reality of real estate investing right now and specifically in Chicago I analyze a lot of properties and most of them don't make sense. When prices, mortgage rates, insurance, and other costs go up obviously that is going to hurt the bottom line. We're still in a seller's market as well so there's still more demand than supply. There are deals out there but they are harder to find. When I look at a listing, I can usually tell in the first few seconds if there is cash flow potential by just looking at the list price, taxes, and rent roll.
I've analyzed enough properties to know a 4-unit in Skokie for $700k-$900k with $15k-$18k property taxes and a rent roll of $1500 for each 2 bed/1 bath unit isn't going to work at 25% down. Especially when the owner has to pay the heat bill.
I just helped a client close on a 2-unit in North Austin to house hack where it should cash flow $300-$400+/mo once fully rented and have a 3-unit under contract in Brighton Park to house hack that should cash flow $100-$200/mo when fully rented. You can't be super picky in this market if you want to get something otherwise you'll be waiting around for something that may never come. Totally depends on your expectations and how realistic you are.
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Daniel Bourdeau
Real Estate Agent · Chicago, IL · Member since 2020 · 48 posts · 43 votes
1y
@Account Closed

Chicago is tough to make it work from a cashflow perspective. A lot of buyers are in it for the appreciation (Chicago should continue to appreciate around 5% this year) rather than cashflow.

IMO, there are limited ways to Cashflow in Chicago. Investors often make it work by doing a 'house hack' where they live in one units and LTR or STR the other half. Being creative like that is how I make the numbers work - with my in-law unit covering most of my mortgage on the whole building.
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Russell BrazilBusiness Member
Moderator
Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
1y
Break even at 20% would be a dream in the major metro areas on the coasts. Takes 45% in most of those cities to break even.
[email protected]301-893-4635 Podcast Guest on Show #192
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- Sean McKee
  Rental Property Investor · Chicago, IL · Member since 2017 · 268 posts · 189 votes
  1y
  Quote from @Russell Brazil:
  
  Break even at 20% would be a dream in the major metro areas on the coasts. Takes 45% in most of those cities to break even.
  
  Do you mean 20% down payment?
  0 Reply
- Russell BrazilBusiness Member
  Moderator
  Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
  1y
  Quote from @Sean McKee:
  
  Quote from @Russell Brazil:
  
  Break even at 20% would be a dream in the major metro areas on the coasts. Takes 45% in most of those cities to break even.
  
  Do you mean 20% down payment?
  
  Yes
  [email protected]301-893-4635 Podcast Guest on Show #192
  District Invest Group545 Reviews
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Sam Dietrich
Member since 2022 · 2 posts · 0 votes
1y
House hacking currently in Roscoe Village. Need to rehab the coach house and do some exterior maintenance, but rents were under market and place should cash flow on 5% down once we move out…granted putting in about $100k in work…. Did the same on a 3 unit in Pilsen and a 2 unit in east Logan. I think if you find options for in law units that aren’t utilized or rents below market rent that can be raised through a quality rehab the nice areas can work, but we are probably going to be stuck after this one for a while just because interest rates are at a point where we can effectively take capital out with the low down payment strategy and limited equity even post renovation, but long term, should be a great investment to refinance eventually / hold while rents and place appreciates.
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John Warren
Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
1y
@Sean McKee I am yes, but it is not easy for a first-time house hacker with limited funds to get in these days. Typically, you have to put in some sweat equity in order to see any cash flow.
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Basit SiddiqiBusiness Member
Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
1y
Given the interest rate in 2025 and high property taxes in Chicago, it may be hard to make it cash flow by just putting down 20%. You may need to put down more to make it cash-flow.

Best of luck!
[email protected]917-280-8544
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Aaron ZimmermanBusiness Member
Accountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes
1y
Most of the northwest side is going to be difficult (but not impossible) to cash flow in but there are some deals that pop up from time to time. My advice is to keep analyzing deals to know what a good deal for you looks like. Usually in October- January, you can find some deals, especially ones that are sitting on the market for a little longer
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