Am I the Only One Struggling to Find Cash-Flowing Deals?

[Eric Flatt]

I'm currently looking for a my next deal in Chicago and my search has been all MLS deals. I'm searching for a 2-4 unit, but I haven't found anything that works for me. Btw, I'm talking about C-ish class and above properties (no D class). I tend to be cautious and conversative with my deal analysis, but am I the only one finding it a bit difficult in Chicago? If someone can point me in the right direction let me know!

[Henry Lazerow]

I am in Chicago and it’s definitely not easy anymore to find cash flow. Look at 4 units you can boost rents high on these and actually cash flow! Even on north side as the rents can go up so much. Normal to see buildings sold at $1200 a month go to $2300 a month after updates. 2 units don’t really cash flow anymore but haven’t really since 2017 or briefly during COVID with crazy low rates. Some 3 units can work too. It’s mainly a long game though, my Roger’s park rentals go up around $100-120 each unit per a year so it adds up fast. I have a 4 unit there kind of on boarder to edge water the growth been amazing. 

Don’t fall for the cheaper areas that “cash flow”. These 1-1.5% areas used to sell at 3% and really only cash flow on paper. I own a 4 unit in Rockford for example and 0 chance anyone is actually cash flowing at today’s prices. I got it for 50% what goes for today and it still has so many tenant issues and turnover costs barely nets out positive annually.

P.S. if buying class A/B Chicago just self manage. I have Cali clients self managing here with leasing agent and handyman it’s super easy. 2 or 3 hours a month and everyone’s on autopay.