Chicago (south side) help!

[Serge S.]

I'm an experienced RE investor in AZ and have only invested in my region thus far. I've been approached by an asset manager I've used to get incredible 50% ARV deals for the past few years with a small Chicago package. I've been researching and the deal looks good but I'm really weary about the murder capital and getting stuck in a potential war zone. Any feedback would be greatly appreciated.

1. Duplex in Englewood (May St) neighborhood looks to be in great condition built early 1900s.

2. Triplex with 2 2bd upstairs flat and 4bd downstairs (Escanaba Ave) brick early 1900s needs work.

3. Duplex (69th st) brick early 1900s needs work.

I don't have much info yet and I don't know the exact level of rehab until I have someone on the ground inspect. Looking for general info on the areas and renting in such neighborhoods. Looks like definitely section 8 but with a decent property manager may be doable. Not looking for war zone nightmares but the returns look too good to be true. Total package would cost under $60k. Any referrals on an experience person on the ground would also be very helpful. These are all off market REOs held by a mid size bank.

Thanks BP nation, your help is really needed and appreciated!

[David B.]

I have rentals throughout the Midwest with many being on the south side of Chicago and I have never had an eviction. I deal with both market renters and section 8 and have not had a horror story to tell in 18 years. I do run into odd and peculiar situations but that is across the board. There are always challenges within real estate be it neighbors, unsavory tenants, or economic setbacks. I just read a article of a US Congressman leaving a landlords nice rental in Washington in a wreck. You should screen a person in Englewood on section 8 the same way you would screen a market renter in Beverly. Contrary to popular belief a lot (not all) of section 8 tenants like and respect beautiful places.

Most people are unfamiliar with most of these areas and are deterring potential investments from places that need it the most. There will be blocks and sometimes areas as a whole to stay away from but south Chicago from an investment standpoint is very satisfying. I self manage over 20 of my own properties in Chicago. I often sit on the sidelines when these discussions take place just thinking that their ignorance plays in my favor. The realization is that playing the sidelines does not help potential on the fence investors, the neighborhoods, or me in the long run. Chicago has great deals to be had but do be vigilant in your search.

Nice Investing