I want to get everyone's opinion on investing in non brick buildings. I know that every market is different, and maybe a non brick building may not be an outlier in certain areas. The potential property that I am interested in is located on the North side of Chicago in an area that most buildings exteriors are composed of brick. The property will cash flow well based on similar units in the area, but how concerned should I be about appreciation, or difficulty to sell in the future?
The property location and the return on your investment is more important then exterior of the building . If the property is in Good condition and priced right, then go for it.
@Elias Betondo If you're working w/ a realtor they should be able to provide you w/ the sold non-brick comparables near you're property.
Something else to consider. Only do this if the numbers make sense. We had a frame house purchased @ a discount in the DFW area. All the sold comparables were brick. We had 2 different After Repair Appraisals done, one for brick & the other for a frame house. In this particular neighborhood, adding a brick facade increase the value >$50K more than the frame. The realtor we were using to sell the property agreed w/ the number, so we bricked up around the frame. The DFW city fathers approved it & it sold fast. This was a flip, not intended for cash flow so our strategy was different than yours.
I see no issue buying a frame in the city proper.
Plenty of frame multi units to comp.
In Chicago bricks are king. The are prettier, more desirable, sell faster, and typically the construction is higher quality.
For value, you will see them comping out higher. Importantly days on market is lower even at higher prices. Although frames are better for cash flow which is one of my main aims, the history of rentals in my frames do not match that of my bricks. I believe the main reason is quality of renter that I can attract with a brick.
I own a 3 unit frame building on the north side. Brick may be more desirable to own in Chicago, but I find that tenants care far more about the quality and amenities of the apartments themselves than the exterior of building they're in. I've never had trouble renting my units to great tenants. As for eventually selling the building, there will always be a market for buildings with numbers that work, whether it's brick or frame.
In my opinion, if this is a buy and hold for monthly cash flow - it makes no difference between brick or non-brick. However from personal experience, it is much easier and less costly to repair vinyl siding than repair issues with brick. Happy Holidays !
Thank you for all the replies. Very good points by everyone. I appreciate the input.
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing