Emotional Property Purchase - Sanity Check
Hi all,
I hope this an appropriate post for this forum--if not, I apologize. My grandmother passed away earlier this year, leaving her house in Chicago (Old Irving Park) for sale. The house has been in my family for over 60 years, so let me admit that this would be a 100% emotional purchase, which definitely goes against my normal financial sense. However, since I'm not a complete idiot, I wanted to see if those experienced in the rental market in Chicago could help me think this through. I'm not in the place to move right now, and the house is more expensive than I'm ready for (I wouldn't have 20% to put down) as a residential purchase.
What I want to know is this: If I purchase the house and convert it into a duplex (it originally was one and my grandparents made it one house, so this wouldn't be an absurd task), is it likely that rent would cover the mortgage? My goal would simply be to break even on the mortgage. I would hire a property management company to take care of everything and essentially allow me to purchase and "hold" the house without losing money until I'm ready to move back to Illinois and live in it. Here are some stats:
- estimated monthly mortgage payment after 5% down at 4.379% interest: $1604
- square footage: 1040 (not sure on the breakdown on upstairs and downstairs, but probably about even?)
- downstairs would be 1 bedroom, 1 bath
- upstairs would be a studio with a separate bathroom, walk-in closet, and small entryway room
- features I think are "pros" for potential tenants
- front porch
- fenced yard (with cement and grass)
- walking distance from Blue line
- parking (one car garage, space for a car on the cement part of the yard, and permit on the street)
- basement and a bunch of storage space
- central air conditioning
- features I see as cons
- downstairs, the kitchen and bathroom are outdated (both are functional, but they look like a grandma's house, haha)
Sorry for being so long winded, but I wanted to give as much information as possible. Based on all of that, do you think the place sounds rent-able, based on your knowledge of the rental market? Between the upstairs and downstairs, would it be possible to cover the mortgage, or would this labor of love put me in the red?
Thank you in advance for your help!