Chicago: Investing in East Garfield Park and Austi

Rental Property Investor · Chicago, IL · Member since 2017 · 268 posts · 189 votes

Hello BP and fellow Chicagoland Investors.

Through conversations and research I’ve increasingly heard more about East Garfield Park and Austin (especially East Garfield Park). It seems like both areas offer strong cash flows.

I’m aware of the crime in both areas and the potential risks stemming from that.

However from a rental aspect what blocks/areas, if any, attract the best tenant pool? Have you experienced any significant periods of vacancy?

I’ve been to the neighborhoods quite a bit, but never really considered them from a rental aspect. I’d be curious to know what people think.

Thanks

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John Clark

Member since 2018 · 1k+ posts · 1k+ votes

Don't touch Chicago, or Illinois for that matter, until they both get:

1. current covid-19 deficits/budgets under control (not really their faults on that one) and you find out how much taxes will rise on that issue, AND;

2. their pension deficits under control (essentially never, but we can dream) or at least stop having to make $800 million yearly payments due to their criminal neglect of the pension problem, AND;

3. at least for Chicago, ridiculous pro-tenant laws are modified/eliminated. I don't mind looking after tenants, but Chicago's going off the deep end.

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John Clark
Member since 2018 · 1k+ posts · 1k+ votes
6y
Don't touch Chicago, or Illinois for that matter, until they both get:
1. current covid-19 deficits/budgets under control (not really their faults on that one) and you find out how much taxes will rise on that issue, AND;
2. their pension deficits under control (essentially never, but we can dream) or at least stop having to make $800 million yearly payments due to their criminal neglect of the pension problem, AND;
3. at least for Chicago, ridiculous pro-tenant laws are modified/eliminated. I don't mind looking after tenants, but Chicago's going off the deep end.
3 Reply
Dante Williams
Wholesaler · Chicago, IL · Member since 2010 · 43 posts · 9 votes
6y
@Sean McKee both areas are on a block by block basis. In Austin there are certain areas with higher concentrations of crime particularly bordering Central east to Cicero and Augusta south to the 290. Even within that large area there a few good blocks.
You’ll have to drive the blocks yourself to see if you’re comfortable investing there. East Garfield is similar but the high crime spots are more scattered instead of block to block. Hope that helps.
1 Reply
Shamar Gregg
Lender · Chicago, IL · Member since 2020 · 35 posts · 44 votes
6y
My property is in the Austin area. I have good cash flow but I would say definitely depends on what part. For example, my property is directly across from Oak Park, so not deep Austin which helps rents.
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Sean McKee
OP
Rental Property Investor · Chicago, IL · Member since 2017 · 268 posts · 189 votes
6y
@Dante Williams. Thanks for your reply . Yes it very helpful. I’ll definitely drive around more to get a feel of the vibe.
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Sean McKee
OP
Rental Property Investor · Chicago, IL · Member since 2017 · 268 posts · 189 votes
6y
@Shamar Gregg I kind of figured that would have some of the higher rents. What kind of tenant base do you have? Families?
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Sean McKee
OP
Rental Property Investor · Chicago, IL · Member since 2017 · 268 posts · 189 votes
6y
@John Clark. I agree with you about Chicago and Cook County in general. The deficits are definitely reflected in the taxes.
And the new COVID-19 tenant laws seem likely to stay after this is all done. This will definitely make Chicago/Cook County much less appealing from a rental aspect. So I’m definitely trying to tread carefully to ensure I get properties that can attract the best tenants.
0 Reply
Henry Lazerow
Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes
6y
In austin if your close to North Ave that area is pretty solid or as mentioned above on the boarder of Oak Park also solid. I have had clients with good long term tenants and little headache in that area. You need to have pretty nice units though to get the good tenants I wouldn't buy cheapest building or it may be lots of evictions, high vacancy, etc. East Garfield the closer to Western Ave the better.
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Jonathan KlemmBusiness Member
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Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
6y
@Sean McKee - I don't specifically invest in Austin or surrounding areas, but if you can find a good block and provide a solid product (nice finishes, etc.) you will naturally attract higher quality tenants.
What's your price range and what type of ROI/cashflow are you looking for?
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Shamar Gregg
Lender · Chicago, IL · Member since 2020 · 35 posts · 44 votes
6y
@Sean McKee I have great tenants. Currently for my 4 unit, I have one Chicago government worker, a retail store on Michigan Ave Manager, and a couple who both work full time.
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Bret Rankin
Member since 2018 · 20 posts · 2 votes
5y
East garfield is gentrifying. In term of purchasing, I would North of Madison , and East of the park. The best streets are Warren, Washington, Fulton, Fransisco and California. The closer you get to Western, the better the rent. Right now I am getting 1500 for a 3bd 2ba 1500 sqft.
1 Reply
John Warren
Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
5y
@Sean McKee be very careful as you dive into these areas. I know Garfield Park has had some activity, but these have historically been specialist only types of neighborhoods. In addition, prices are quite high right now in these neighborhoods when you account for the potential vacancy and economic vacancy risks. I recently listed a two unit for over 300k here, and it is closing at 150k per unit.... the price to rent ratio is well below 1% for what I would consider a D class area. Obviously, my seller is happy but the buyer could be in for a world of pain in the future.
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Sean McKee
OP
Rental Property Investor · Chicago, IL · Member since 2017 · 268 posts · 189 votes
5y
@John Warren that’s definitely an interesting insight. I definitely noticed some crazy competition when I was searching there. I will definitely have to do more research.
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John Warren
Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
5y
@Sean McKee there is definitely nothing wrong with investing in these neighborhoods, especially if you know what you are getting in to. I sat through a presentation a few years ago from one of the main housing providers in Austin. This guy owns hundreds of units in Austin, North Lawndale and Garfield Park, and he was saying his economic vacancy at times has been as high as 40% or more. Again, just make sure you are building in realistic vacancy, maintenance and CapEx. Your unit turns will NOT be as easy as they would be on the north side if you are going to operate here.
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Olivia A Yates
Rental Property Investor · Member since 2021 · 4 posts · 2 votes
5y
Hi, I agree with what most people are saying. I own a four-unit in East Garfield Park, and I also work at a school in Austin. I feel that East Garfield Park is your best bet. In Austin, the closer you are to Oak Park, the better. For Garfield Park, the closer you are to Western, the better. However, my property is off Sacramento, and I get $1400 for a three-bedroom and one bath. They all are updated, so it makes it relatively easy to rent out. When I purchased the property back in 2016, I had all section 8 tenants. Now I have all cash-paying tenants with good jobs. East Garfield Park is moving in the right direction. You just have to grab one before it’s too late.
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Brie SchmidtBusiness Member
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Real Estate Broker · Chicago, IL · Member since 2013 · 6k+ posts · 5k+ votes
5y
@Clif Wilson is an agent that works in that area, he may have insights
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