Chicago, IL · Member since 2011 · 16 posts · 3 votes
I live in the local Chicago area and was thinking on investing in a 4 unit property with a 150k cash on hand. The market seems very hot at this point so not sure where the real-estate bubble is in the foresight.
Looking at Bridgeport , Pilsen , Lower west , Maybe some suburbs to invent in.
Its hard to get a double digit cash on cash return at this point. Prices have sky rocketed already.
Specialist · Indianapolis, IN · Member since 2014 · 670 posts · 352 votes
9y
Eddie Shah get ready for a avalanche of responses with the title to your thread. Are you strictly looking for buy and hold or ways to continue growing your investment capital?
Rental Property Investor · Indianapolis, IN · Member since 2015 · 108 posts · 66 votes
9y
Hey Eddie,
Are you pretty set on investing locally in Chicago? I'm in Indianapolis, and although the market is hot, in able to work with investors to find double digit cash on cash returns.
I rent by the bedroom to young professionals which has been a niche that has treated me very well up to this point.
Feel free to shoot me a message and I'd be happy to share my perspective.
Onwards,
Matt
Chicago, IL · Member since 2011 · 16 posts · 3 votes
9y
I am on the fence on crossing over to either WI, IN or MI. Proximity might become an issue as I have a full time job.
Also at times rent in those market are low so even if I have 12 unit property paying 500 a unit each , I rather invest in something like a 3 - 4 unit in Chicago where I can pull 1500 a unit .
Specialist · Indianapolis, IN · Member since 2014 · 670 posts · 352 votes
9y
Eddie Shah get ready for a avalanche of responses with the title to your thread. Are you strictly looking for buy and hold or ways to continue growing your investment capital?
Real Estate Consultant · Brookfield, WI · Member since 2014 · 873 posts · 350 votes
9y
@Eddie Shah real estate bubble only matters when you over pay. Let the number dictate if you have a good deal or not. I will wholesale deals if you want to purchase in Milwaukee, WI.
I live in the local Chicago area and was thinking on investing in a 4 unit property with a 150k cash on hand. The market seems very hot at this point so not sure where the real-estate bubble is in the foresight.
Looking at Bridgeport , Pilsen , Lower west , Maybe some suburbs to invent in.
Its hard to get a double digit cash on cash return at this point. Prices have sky rocketed already.
Should I wait or pull the trigger ?
Are you looking to buy and hold? How long term are you looking to invest in?
Bridgeport and Pilsen are certainly up and coming neighborhoods, IMO.
Chicago, IL · Member since 2011 · 16 posts · 3 votes
9y
There are two plays Appreciation or Cash Flow ; its hard to get both in todays market in the same deal at least thats what I am seeing in my surrounding areas. Prices have peaked.
I wont get appreciation unless I hit big and invest in a pocket that will change drastically and people flock to it raising the prices down the line.
So invest in a stable market where property cash flows with a 25% down payment. Meaning I should/hope to get min 15% cash on cash return which in my case would approx. 22k a year with the 150k down payment.
Investor/RE Broker · Eugene, OR · Member since 2014 · 3k+ posts · 968 votes
9y
@Eddie Shah If you are thinking of waiting, for prices to decline I assume, you might consider putting the money to work via shorter term private lending or some sort of syndication deal and still get double digit returns on your money. You won't anything from sitting in the bank.
Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes
9y
Hi @Eddie Shah proximity is definitley an issue - I have reduced my farm area to 15 minutes around either my home or my office. If you have to go outside Chicago you should stay within driving distance and you need someone local, like @Michael Henry - he also has a background as a PM and GC and knows his way around in Milwaukee.
Chicago, IL · Member since 2011 · 16 posts · 3 votes
9y
Thanks for everyone's feedback. I am looking in Class B neighborhoods where properties are relatively easy to manage. Rents can be increased at least 20% within a year or so with some minor improvements. 90% listing on MLS I pass on because the numbers don't work within my price-range. I will hold on to the cash till something really good comes along just don't want to park it if it dose not make sense. Hard to find good deals :(