Understanding LTR in North Chicago

[Raj A.]

Through deal review and market research, I'm starting to narrow in on North Chicago (Lincoln Square, Lake View, Roscoe Village, Albany Park, North Center, Uptown, Andersonville, etc.) as an area to invest in LTR, given the great schools and amenities like parks, access to downtown, etc. Generally speaking, what do renters expect in this area? Do they expect that the landlord pays water, utilities, gas, etc.? Is that negotiated? Is it typical for LTRs to do x months locked in then month-to-month? Or month-to-month off the top? 

In general I'm noticing some great light rehab duplexes and triplexes in the area (less targeted to families, more for younger professionals) as well as SFRs geared toward families given the proximity to excellent schools in the area. If any existing investors can share their insights on what renters expect in the area, that would be great.

[Paul De Luca]

@Raj A.

Most of the time the landlord pays the water bill at any 2-4 unit building and what utilities the tenant pays depends on the building although it's standard for the tenant to pay for their own electric. It's also common for tenants to also pay for gas but if there's only one gas meter at the building then the landlord is paying for that. It is not normally negotiated but dictated by the number of electric & gas meters at the building.

I think most landlords do 1 year leases which sometimes do automatically renew on a MTM basis but it's best practice to sign a renewal. MTM leases are common in Chicagoland though. If the leases are MTM, which tends to mean there are no written leases, be sure to ask for signed tenant estoppel letters so you know the basic terms of their tenancy.