I recently accepted a senior level position in the chicago area! I'm not only excited about the position and the location, But I'm very excited to expand my real estate investing to the chicago area!
My first play there will be to buy a multi-family for an owner-occupy until I get familiar with which areas I'd like to live in permanently. Preferably a 4 family where I can get the best terms for a residential loan.
Chicagonites! Where are the best places to buy/live for the value. I know that there are parts of chicago (particularly South Chicago) where you shouldn't buy unless you own a bullet proof vest. But these are also the parts of town that seem to be claiming the highest cap rates. 15% Caprates?! WHAT?!
I bet rent collection is a huge issue in this part of town.
As always your comments are appreciated!
depends where you job will be located at for commuting reasons
15% Cap Rates will be tough to find in N and NW sides you'll probably need to go South
I don't mind an hour long commute if needed. My current commute is about that long so Its not a big deal. Quality of life is important though. Being close to amenities like shopping/restaurants/etc all for a reasonable value.
It would be good if the area is up & coming.
I'm looking in westloop area and bridgeport. They are close to the highway I will use and seem to be safe?
Westloop and Bridgeport are going to be expensive. Westloop is a better location but Bridgeport is still a cool area that is definitely growing.
Also 15 cap deals don't exist (at least not when you account for ammunition and firearms :)).
@Chris Winterhalter - yeah thats what I figured. I was checking the crime rate in certain areas of south chicago block by block compared to where some of these listings were. I don't think I'm mentally or physically prepared to deal with the type of tenants that live in these areas.
What areas of the city would you suggest? Again I'm going for value compared to area amenities.
I wouldn't live anywhere in Chicago where cap rates are above 5 or 6 but that is just my personal preference. My main experience has been with the city and right around it but I am sure a lot of other people will chime in with areas on the outskirts. If you are willing to commute an hour then your options are going to open up. I wouldn't live north of Lincoln Park, South of South Loop or West of the West Loop. However that is just my personal preference of being in the city. Everything in that area isn't going to come with a cap rate. I would live in the city and invest outside of it! Sorry if that doesn't help much.
@Samson Kay Welcome to Chicago (when you arrive), I'm mentally & physically prepared to deal with the type of tenants that live in these areas. If you ever want to partner up in anyway let me know and we can sit down and discuss the best way to work things out. This goes for you and any other Chicago investor thats into the profit possiblilites of the Chicago SE side but have concerns of safety in dealing with these areas.
@Samson Kay - what kind of budget are you looking at?
350-500K, 4 family. At 350 K, some lite to moderate repairs. But at 500K I would prefer turn Key.
And I would prefer for it to cashflow.
@Samson Kay - 4 units are hard to find here. But in that price range I would check out logan square, portage park, albany park, uptown for the North Side.
If you tell me where your job will be located in i.e. part of the city or suburb I can advise you on some potential areas to look at.
An hour commute on a good day in Chicago can mean 2.5 hrs during rain or snow.
Chicago is a huge city. 234 sq miles lots of opportunity both North and South.
Specifically I'll be working in bollingbrook right off of I55. I've already went to see a couple properties in Westmont and bollingbrook themselves. But I guess I just want to experience city living. So if I could be be in the city proper that would be preferable.
@Samson Kay Congratulations on your new job. IMHO, the only thing worse than a commute to the city is the "reverse commute" to the suburbs. I've seen it make people go insane. It doesn't help that 55 is a parking lot. Google might tell you 45 minutes, but it's going to be much, much worse. With all due respect, you may want to try the commute (both in the morning AND in the evening) a few times to see if you can take it. If you're dead set on living in the city, see if you can negotiate a 6 AM start time and a 3 PM departure.
Back to real estate. I like those neighborhoods that @Brianna S mentioned. I would add Old Irving Park and Avondale to that list.
Bolingbrook is not ideal for anything N or NW it will be a 2 hour commute most days unless you get an alternative schedule like @Jonathan Pliszka mentioned.
If you are working in Bolingbrook and want to live in the city the SW or S side will be a better commute..
Oh your job is in the burbs? I would rent in the city first if your heart is set on living in the city. Don't buy until you have made that commute for a little while.
I once convinced myself that a very high paycheck was worth the 18 mile reverse commute to Northbrook. Needless to say after a few 2 hour commutes home (almost 3 hours on my anniversary) I quit just after 6 weeks and my husband was not happy.
Stick to the South side for your own sanity. What about Pilsen? I hear that is "up and coming"
From a logistics standpoint, South side seems like a safe bet. But from a Safety stand point...
Well is it really as bad as they say?
The Southside is huge but the troubles that exist are bundled up as if it's one big neighborhood.
There is an aspect of every area in Illinois located on the Southside. If you want Lincoln Park or Hoffman Estates, there are areas equivilent to them on the Southside. I'll email you some zips and a break down of the areas within those zips as to where you are just as safe as those places that are considered the best places to live in Illinois.
Hey Samson, I currently live in the Kenwood/Hyde Park neighborhood (couple of blocks from Obama's place). It's safe compared to other south side neighborhoods. It's right next to U of Chicago which is expanding and revitalizing the area. So, if you were to invest on the South Side of Chicago, Hyde Park would be it. You're next to Lake Shore drive which takes you to I-55 in 3 min and you off. Best thing is to have a garage to protect your car and home security. Unfortunately, you'll have to worry about break-ins all over Chicago.
I work in Bolingbrook. There's plenty of nice 4 flats to choose from around here. I routinely commute to the city during rush hour and I promise you up and down i55 will be an hour and a half stop and go. In the rain or snow, double that.
Nice to meet you @Samson Kay !
If you're looking at Bridgeport, but are turned off by the high prices, perhaps you may consider looking further west or south.
Also, check out Trulia's Crime Map that's in Beta here: http://www.trulia.com/crime/
The city of Chicago has many options...and great cap rates in many parts but most likely areas you don't want to be an owner occupant. I say that based on you will most likely look up the crime rates and decide for yourself. There are many great investment opportunities in Bollingbrook, Crest Hill, Joliet, Shorewood, Plainfield, & Romeoville where you can still get over 10% returns at this point but prices in these areas like the rest of Chicago have gone up in last 3 months mostly due to lack of inventory and so many more investors pulling the trigger this year.
I am sorry to tell you this Samson, but you'd have to be crazy to commute from the city to Bolingbrook every day. I've done the long commute thing and in this city, especially when you are talking about dealing with I-55, it sucks.
We have an excellent Metra system to get you between the suburbs and the city. But the train schedule is only convenient for living in the suburbs and working in the city. Otherwise the train only runs once an hour or once every two hours. And there is the fact you have to find a way to get to the Metra station downtown from wherever you are living, and a way to get from the station to your work building. With a reverse commute, the train is not even be a viable option. So you will be forced to make that painful drive.
Chicagoland has some fantastic suburbs, many of them very close to Bolingbrook, with downtown areas and restaurants. When you want to hang out in the city, then you can make the drive. I doubt you intend on going clubbing every night of the week. To me it makes more sense to have a nice easy drive to work five days a week, and then only have to make the more difficult trip downtown every once in a while when you have a reason to go.
Then again, maybe I'm just a biased suburbanite.
@Samson Kay So if you have looked at the properties in the suburbs, does that mean you would live outside the city of Chicago? Did you look at the 4 unit in Westmont at 63rd/fairview?
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