New Member Looking to Connect and Learn

20 Replies | Chicago, Illinois

Hello Chicagoland Investors!

My name is Peter and I'm a recent graduate from DePauw University in IN (any alumni here??). Since graduation, I was bitten by the real estate bug and have spend the last several months learning as much as I can about the industry. The majority of my learning has come from BP Podcast and Straight Up Chicago Investors podcast. Now, I'm looking to take my education to the next step by connecting with seasoned real estate professionals in the Chicagoland area. 

My goal for 2021: buy my first property. I'm leaning towards a condo in Chicago. One that I'd live in for a few years before eventually renting out. I've heard mixed opinions about condos in Chicago. What do you guys think?

I'm looking forward to connecting with as many of you as possible!

@Peter Nicieja

Hi Peter, welcome to the community. I was in the same situation as you a few years ago and now own/manage a few multi units in the city. Reach out if you need someone to bounce ideas off of!

Hey Peter, I house hacked a condo in Chicago and it went very well for me. Multifamily eventually becomes the play in order to scale but to start, it’s great especially if you want to buy and house hack in some of the more hip areas of Chicago. 

@Peter Nicieja welcome to he community! A condo in the city is great for quality of life. I doubt you are going to get a steal on a condo in this market, but that is not always what life is about. Once you are settled you can focus on networking, saving and getting ready to start picking properties up!

@Paul De Luca

Great question. To be honest, a multiunit is a little intimidating to me because I've never bought property for myself before. I figured a condo would be a better way to enter the investing business. Would you recommend someone like me to still go for a multifamily instead?

@John Warren

Thanks for the warm welcome, John! I've noticed that many high-rises seem to be selling well below their list price in the downtown Chicago area. Obviously, the HOA fees on these are quite high, but since the prices seem to be lower, do you think they could be a good investment?

@Peter Nicieja investment might be a stretch, but you might be able to see some appreciation. I had a listing last year in River North that we listed right before the pandemic, and it was brutal selling in that market. We were able to get it done and our client was happy, but there were definitely quite a few of the units in the building that were sitting and not selling. 

I would think more in terms of location for you. If you can pick up a bit of add value or instant equity all the better! Most of these would not cash flow though if you had to rent them out with debt on them since the HOA fees are sky high like you mentioned.

I was just off north and western. 3 bed 2 bath top floor nicer condo. Was able to get $1250 for my master and parking with its own bathroom and $1150 for the 2nd bedroom with a shared bathroom. 

Hey Peter congrats on graduating and welcome to the world of real estate. You'll soon discover that the midwest is the place to be for investing ;)

Originally posted by @Peter Nicieja :

@Paul De Luca

Great question. To be honest, a multiunit is a little intimidating to me because I've never bought property for myself before. I figured a condo would be a better way to enter the investing business. Would you recommend someone like me to still go for a multifamily instead?

It depends on what you mean by "better". If by "better" you mean easier or less risky, that may be true. With condos there's generally less for the investor to worry about in terms of large unexpected expenses since the HOA handles most a lot of the CapEx and some of the operating expenses like roof, common areas, mechanicals not in your unit, landscaping, snow removal, some utilities, etc. On the flip side though a lot of the really high HOA assessments can make an investment condo difficult to cash flow. If you were to house hack though, which I view as very low risk if you do things correctly, the reward would likely be much greater. More doors = more potential profit.

The way to make buying multi-family properties less intimidating is to get educated on the subject and then work with a team of experienced professionals who can help you do your first multi-family deal. By doing those two things you'll greatly reduce your potential risks.

@Peter Nicieja Welcome to the Chicago market, welcome to BP and congratulations on making this choice. I'm going to play devils advocate on the general advice to house hack a multi family. It seems lately everyone and their mother is looking for 3 units or more. They're trading extremely tight in Chicago from what I've been seeing and people are stretching their numbers to make them work. Not saying it won't work out, because it very well could and probably will, but condos are often overlooked. It seems to be a neglected asset class, especially in B-C class areas. 

@Michael J Scanlon gives a perfect example.

@Peter Nicieja - Congrats on graduating and even more props for wanting to get into real estate right away.  @Mark Ainley podcast (https://www.straightupchicagoi...) is an awesome resource, I totally agree!

Sounds like you are on the right path for 2021, I think buying a live-in flip / rental is a great idea especially now.  I think Chicago is a great market to invest in as long as your numbers work.  Was there a specific area you were thinking about for the condo?

Happy to connect to see how we could help.

Blown away by the incredible responses I've gotten on here--I've already re-adjusted by game plan based on what I've learned here. I joined a great community. Thank you all!

Hey Peter, welcome to Chicago REI game.I am a younger investor here. I would recommend starting off with duplex- quadplex. (house hacking). You get great hands on experience on the day by day operations of small multi units. Best of luck!

Feel free to reach out with any Questions!

Hey Peter! Welcome to the club. :)

I'm no expert but...If you're thinking about getting a condo in the city, DO IT FAST. There is still a plethora of inventory and the city hasn't quite recovered from the shutdowns. Everyone and their mother was looking for a SFH over the last 8-10 months. But with things opening up I think it's going to be much more competitive and difficult to find good condos at good prices. We currently rent in South Loop and are looking for a condo to buy and live in ourselves as well. HOAs are sometimes frustratingly high--and unjustifiable (which is even more angering)--and many buildings have rental restrictions. So make sure you choose a condo that you truly want to live in yourself, at least for a while. IMHO, this is the ONLY way WE would buy a condo in Chicago. If you're talking about areas outside the immediate 'Loop/South Loop/River North/etc.' areas, I believe you have more opportunity to eventually rent out your unit and make some money (since HOAs will be lower). Also keep in mind most condos in the city don't come with parking, which is a HUGE plus to not only you (to have a parking spot with your unit) but also your future tenant(s).

Not to discount anything anyone has said here about multi-plexes.... I would advise not to get involved in something bigger than what you are absolutely comfortable with. This is only the beginning of your journey. There will always be another multi-plex in Chicago to buy if you don't buy one right now. 

Good luck!

@Peter Nicieja - @Mark Ainley podcast is excellent resource because it is so specific to the Chicago Market. A lot of folk have made excellent suggestions. Still some good 3-4 House hack available. You may have to be a bit flexible. There was one we just wholesaled just north of Oak Park. They come up you may have to do a bit of digging. But you seem like someone who is not afraid to learn. If you are willing to put a bit of time into it some good off market opportunities out there. The one I am talking about was a short sale due to some health issues. As tough as it may seem even this market there are a ton of people selling off market. Some people just don't want to list their properties for what ever reason. Always seems strange to me when there is equity but it's good for us to find deals that are under valued. The fight over deals is on the MLS generally not off market.

@Peter Nicieja congratulations on your new journey.

Makes sure you research first time homebuyer programs in Chicago/Illinois. there are a ton of down payment assistance for first time homebuyer in the city.

When I purchased my first condo in the Wrigleyville area I received a 5% grant from my bank (about 15k with no strings attached)

Good luck and feel free to reach out with any questions

Check out @Kristopher Toribio meetups they are a great way to network. I have had a few clients do condos recently as they are more affordable and it's pretty easy to find cashflow. Look for low rise buildings (no elevator) so assessments low and with 2 or more bedrooms. Albany Park and Irving Park work well but you can also find deals in the trendier areas like West Town easily.