Chicago, IL · Member since 2015 · 31 posts · 1 vote
I had a previous rental back in Michigan that helped generate a fair amount of extra income. But it was more of a learning experience though. I want to take the plunge and buy again.
I want to head in a better direction here but I have heard bad things about buying and renting out in Chicago. Anyone experienced or have any recommendations? I heard the city is EXTREMELY pro renter and somewhat give the finger to the landlords. Would I be better off looking to buy a property outside of Chicago?
I have roughly 20k to put into a purchase. Ideally I want to do 2-4 unit building and build on this. Thank you so much for reading! ~Josh
@Josh B. if you buy as a owner occupant, 20K converted to 5% down is about a 400K property with the seller paying closing costs. There are plenty of 3-4 flats in the North Side of Chicago that you can get!
well looks like you might have to buy in the warzones with only having 20k for down payment. Why not go back to Michigan. Lower taxes will help the cash flow
@Josh B. if you buy as a owner occupant, 20K converted to 5% down is about a 400K property with the seller paying closing costs. There are plenty of 3-4 flats in the North Side of Chicago that you can get!
@Josh B. Glad you're looking to "take the plunge." You don't have to buy in bad areas and $20K can go far if you're creative. One approach I'd recommend is getting an FHA loan and living in one of the units for at least a year. This allows you to put as little as 3% down on a property.
The city is tough, but it really requires diligence as a landlord and screening is key. There are a few different threads about the Chicago eviction process so do your homework and decide if you're willing to take all of the necessary steps to ensure you have followed the tenant-landlord ordinances.
One last note on being in an owner-occupied 2-4 flat is many of the tenant-landlord rules don't apply to you so you have more flexibility on many of the things that trip up the landlords who have a problem with the rules.
I want to be owner occupied as well to make things as easy as possible so the FHA sounds perfect. Does anyone have a suggestion of any starting neighborhood? I will have to take a look at our Northside as well. I have been leaning towards Bridgeport. But Little Italy and University Village seem great (plus we live nearby and daughter goes to school nearby so could be better) as well.
Would I be better get a Mgmt company starting off while I get my feet wet again? Seems like a different game than MI and I want to make sure everything starts on a good foot.
If I were going to buy an owner occupied 2 flat and had some experience, I would not hire a PM. I would spend some money on making sure that I knew how to properly screen a tenant especially one that I was going to live next door to. And judging by the amount that you are looking to put down, you may not be in an area where you have plenty of great tenants wanting to live there. The as the quality of the area decreases the more you have to sift for that gold.