New Real Estate Investor in Chicagoland Ready to Learn

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New Real Estate Investor in Chicagoland Ready to Learn

Garrett Kula
Member since 2024 · 1 post · 1 vote

Hello Everybody,

My name is Garrett and I'm currently living in a northern Chicago neighborhood. I've read a couple of Brandon Turner's books now and have been getting really into the mindset to start this journey.

A couple major items I'm initially thinking of is where to start. I grew up in a northwest suburb an hour to an hour 15 minute drive away from where I currently live in Chicago; and my parents still live out that way. Even though the distance would be a lot farther to travel than initially investing in another Chicago neighborhood, I know the tenant laws are a lot more relaxed out in the suburbs, the average price of property is much lower, and it just feels like a smoother entry point than a large city in general.


I'm very interested in multi-family properties to begin my real estate journey and have worked on putting a team together, so I am getting closer to actually acting, not just observing. Does anyone have a similar experience of living in the heart of a city but choosing to mostly invest in the urban sprawl outside? Or any stories of starting with a single-family home helping ease you in instead of starting with a duplex or triplex?

Happy to be here and ready to learn!

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John Warren
Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
1y

@Garrett Kula there are plenty of people who invest in the suburbs, and you can do just fine. The big thing is to get started with a good, quality property. Depending on where you are looking, inventory for 1-4 units can be a challenge as a lot of the NW suburbs are all single family homes unless you are further NW like Rockford or Elgin or something like that. 

The biggest thing is to get started and take action, which it sounds like you are doing. 

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  • Aaron ZimmermanBusiness Member
    Accountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes
    1y

    @Garrett Kula thanks for posting!

    I’ve personally house hacked in the Irving park neighborhood in Chicago with a multifamily so not completely relatable experience to what you’re looking to do but hopefully can provide a few insights.

    If you go with the suburbs in a SFH, you could rent by the room and presumably increase cash flow. You'll likely need to get more bedrooms (probably 4-5). Another thing about most suburbs is that the property taxes can be brutal which needs to be factored in to your analysis.

    The biggest thing is where ever you buy, you need to feel comfortable living in AND upon move out, the property needs to cash flow. 

    Feel free to PM if I can be of any help. Happy to be a resource! 

    I would also encourage you to get involved in networking groups in the Chicagoland area as well as listen to the straight up Chicago investor podcast.

    [email protected]
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  • John Warren
    Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
    1y

    @Garrett Kula there are plenty of people who invest in the suburbs, and you can do just fine. The big thing is to get started with a good, quality property. Depending on where you are looking, inventory for 1-4 units can be a challenge as a lot of the NW suburbs are all single family homes unless you are further NW like Rockford or Elgin or something like that. 

    The biggest thing is to get started and take action, which it sounds like you are doing. 

    2Reply
  • Jake FugmanBusiness Member
    Real Estate Broker · Chicago, IL · Member since 2016 · 256 posts · 250 votes
    1y

    @Garrett Kula  Congrats on getting started.  If you plan to do multifamily in the "Far" suburbs it can be harder to hit your cashflow targets VS city/near burbs simply because there is limited inventory.  Additionally the suburbs have higher taxes compared to Chicago proper.  You do potentially get more stable tenants in some far suburbs due to better schools but the rents typically dont proportionately match the higher prices. 

    SFR rentals typically make the most sense in suburbs where the taxes arent too crazy and you can get 3+ bedroom houses for under $325,000. Anything much higher and you'll find the #s start to get tough. Watch out for the village requirements and make sure your team knows what areas require rental and pre-sale inspections.

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  • Jonathan KlemmBusiness Member
    Moderator
    Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
    1y

    Hi @Garrett Kula - In my opinion, mindset and awareness of why you want what you want is BY FAR THE MOST IMPORTANT thing any one can figure out.  It often might take asking why 5 times to get to the root why.

    Also, I notice that often that why shifts...for me in the beginning, money was important because I thought it gave me power, and growing up I was pretty insecure due to a lot of high schooling bullying...come to find out the power does NOT COME FROM MONEY, but rather from within after identity who you want to become and don't let your past define you.  Probably TMI there lol, but hope that helps a bit.

    I am also from NW Chicago suburbs - Elgin, to be specific.  If you can do a renovation loan with 203k or a homestyle loan to house hack a 2-4 unit multi-family, that typically has the highest potential for equity gain with the lowest cost.  

    You can also horseback with a single family...it's completely a personal preference based on what you are comfortable with.  

    My biggest piece of advice is to connect with local chicago real estate investors in person...highly suggest checking out the christmas party on 12/12:  https://www.biggerpockets.com/forums/521/topics/1218823-chic...

    [email protected]
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  • Riley Poppell
    Lender · Chicago · Member since 2024 · 89 posts · 25 votes
    1y
    Quote from @Garrett Kula:

    Hello Everybody,

    My name is Garrett and I'm currently living in a northern Chicago neighborhood. I've read a couple of Brandon Turner's books now and have been getting really into the mindset to start this journey.

    A couple major items I'm initially thinking of is where to start. I grew up in a northwest suburb an hour to an hour 15 minute drive away from where I currently live in Chicago; and my parents still live out that way. Even though the distance would be a lot farther to travel than initially investing in another Chicago neighborhood, I know the tenant laws are a lot more relaxed out in the suburbs, the average price of property is much lower, and it just feels like a smoother entry point than a large city in general.


    I'm very interested in multi-family properties to begin my real estate journey and have worked on putting a team together, so I am getting closer to actually acting, not just observing. Does anyone have a similar experience of living in the heart of a city but choosing to mostly invest in the urban sprawl outside? Or any stories of starting with a single-family home helping ease you in instead of starting with a duplex or triplex?

    Happy to be here and ready to learn!

    Hey Garrett, I have experience in the northwest suburbs and I would be careful which neighborhood you invest in because other than cashflow the most important thing is ROI. Some areas go up in value and others don't so compared to the city you probably won't see as much exponential growth in the value. When it comes to the new laws coming into the city it doesn't make it harder to buy and rent out the units, it just may become harder to get tenants out when trying to sell it. If I were you I'd be very specific on which town you buy in the suburbs or if not potentially consider the northwest side of the city.

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  • Zack KarpPro Member
    Lender · Schaumburg, IL · Member since 2015 · 834 posts · 774 votes
    1y

    @Garrett Kula welcome to BP. Not sure what suburbs you are referring to, but I have a lot of clients that are very successful investing in areas like McHenry, Woodstock, Elgin, Antioch, Mundelein, Belvedere, etc. Yes the inventory is much lower than the City, but there are 2-4 unit properties to be had, and with good numbers. If you are patient, you will find properties that work.

    But in the end, there is no right or wrong way to invest in real estate. SFD vs condo vs 2-4 unit, hold vs flip, turnkey vs rehab, passive vs active...it really comes down to each individual property/opportunity, what your goals with the property are, and if the numbers make sense or not.

    Best of luck!

    847-387-5513
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