Buying a town home

9 Replies

Does anybody have thoughts on buying a town home (No HOA) in Chicago for buy and hold renting investment if numbers are good and it is available at a good discount

@brianna is right! Also make sure it is a above avg neighborhood and dose it have a rental history?

Thanks. It is a very good neighborhood and rentals are easily available. My only concern is when roof repairs are needed what do I do without HOA? This is one of middle two townhomes so roof is pitched slanting and not flat, it should hold for a while.

I have 2 - no real issues. I think i had three minor-neighbor conflicts over the period of five years.

One of the incident's is where the neighbor just didnt like living next to renters. She turned out to be a complainer and was oddly upset everytime i did something to upgrade the house. Kind conversation over time ended all of that.

GO FOR IT!

Originally posted by @Atul Mohlajee :
Thanks. It is a very good neighborhood and rentals are easily available. My only concern is when roof repairs are needed what do I do without HOA? This is one of middle two townhomes so roof is pitched slanting and not flat, it should hold for a while.

Atul,

Find out the cost of tear off and replacement on roof first.

If you are buying from homeowners or investor go back to the table and NEG with them on replacing roof. If this is not possible then I would set a % off cash flow aside for roof.

The major downside we found to a town home that is not in an HOA is you have no control over neighbors, and they are too close, unlike single family detached, where at least there is some space between, and maintenance, like roofs, can be tricky if you need access to their property to fix yours or his neglect is causing you problems. We lost a good tenant because a ton of people moved into the unit next door and we couldn't get them out for months as the owner lived out of state and the property manager wouldn't do anything, and calling the police wasn't working either (they said no proof they all lived there). They destroyed the place before we finally tracked down the owner. I still have one town home but it's in an HOA. While some of their rules are a pain, everyone has to comply, like the neighbor trying to deny me access to paint the trim and fix the fence on his side, but the HOA rep stepped in and made him give me access to his yard to make repairs.

Thanks everybody. You guys have all great responses.

I am finally closing on a town home in Oak Park for 119000 with no HOA. Expected rent with all utilities paid by tenant is $1500. Appreciation in Oak Park is better than all neighboring towns due to superior schools. Only cosmetic work paint, repair, clean etc. Other bidders on second day on the market but all cash sealed the deal for me. This is a row of six townhomes very well maintained near CTA Station and sold for 220000 plus before the crash. This was an estate sale very well priced to go.

Congrats @Atul Mohlajee !

It's worth celebrating every purchase as long as you've done the due diligence. I like @Sydney Chase recommendation of setting a little more aside from rents to build up an extra reserve. That's prudent for any rental, but maybe needs a little more here to deal with unexpected issues with the roof.

Keep us posted on how it turns out.

Larry

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Join the Largest Real Estate Investing Community

Basic membership is free, forever.