After a good amount of reading I've begun saving for a downpayment for my first rental property. My plan is to purchase a multi-unit property and live in one unit, potentially utilizing a FHA loan. I'm in the process of looking at properties and checking Redfin daily as I try to get a feel for the market and decide on what neighborhood would be best to look in.
I think I would potentially like to buy a slightly (cosmetically) run-down property that I can work on fixing up as I live in it, both to minimize initial costs and to potentially increase home value. I'm a young professional and currently live very close to the Loop with roommates, so if they moved with me it would probably need to be relatively close to the Loop. Ideally, Old Town, Lincoln Park and Lakeview would all be great neighborhoods, but I feel that costs of homes there are too high for my current position, especially if I want to utilize a FHA loan. Wicker Park or West Town could optionally be good, if I could find something affordable and near the blue line.
So, my questions for anyone familiar with neighborhoods here in Chicago:
1. Are these assumptions about neighborhoods and prices correct or am I off base, and do you have any other neighborhood suggestions given my criteria?
2. Are there other ways I can be searching for properties and getting a feel for the market as I build up my funds? I've heard Redfin is a useful online resources because of the MLS access, but is there another way I could be looking at properties not "officially" on the market? Would networking with wholesalers here on BP be beneficial to me or do properties sold by wholesalers tend to be priced high?
Thank you all!
@Donald Hruska Lakeview - Old Town are great areas to live but the numbers won't work... and you will probably need to spend way over the FHA max
West Town - Wicker Park is going to be close to the FHA max so plan on a budget of around $600k so you aren't stuck buying because it is all you can afford
Wholesalers are not a good option for you, The assign contracts so you need to buy in cash
@Donald Hruska There are some other locations you may want to consider based on your price point. They are not as hip or cool as Wicker Park or West Town, but data shows appreciation is on an upturn and the Days on Market or Market Time has gone done significantly (Rogers Park & Uptown).
I'm going to respectfully disagree with @Brie Schmidt comment on wholesalers. Some wholesaler's sign their original contracts as Cash or Finance thus allowing an end buyer like yourself to leverage after the contract is assigned. Some wholesalers actually own the properties they are marketing outright, thus allowing a cash or financed transaction for the end buyer.
@Donald Hruska Place an ad in the marketplace as a shout out to wholesalers & give them the criteria for what you're looking for.
How about a 6 bedder for $11k (or offer?)...
If you are checking Redfin daily you probably saw this one:- https://www.redfin.com/IL/Chicago/9116-S-Dauphin-A...
Is it a bad area? And/or am I missing something else?...
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