House Hacker Seeking Advice for Next Move

Chicago/Skokie, Illinois
General Real Estate Investing
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House Hacker Seeking Advice for Next Move

Lucas Helliker
Investor · Chicago, Chicago · Member since 2023 · 6 posts · 11 votes

Hi all,


I am a house hacker with 2 buildings, 7 units on the north side of Chicago. House hacking has been a great way to get my feet wet with investing. For the past year I have been exploring different strategies for investing BRRRR, Fix & Flips, and even house hacking again.

I've made connections in the past year with wholesalers, contractors, and brokers focusing on properties an hour or two from where I live. I had a few properties where a contractor walked it without me and gave me rough rehab numbers so I could use them in my BRRRR analysis. What I learned from this is that I need to be present on the walkthroughs and understand the construction costs. I can't trust a contractor's numbers who I haven't met and I am not walking the property with. Why would they take me seriously? I also can't be spending 2-3 hours driving to properties, missing time with my family.

So now I am back to investing in my own backyard : the highly competitive and appreciation heavy North Side of Chicago. Typical BRRRRs don't seem to work here because the rent to price ratio isn't high enough. I am considering a Fix & Flip mostly for what I would learn from it : establishing off market deal flow and getting more comfortable with rehab numbers.

Overall i know that the key to success will be to choose a lane and stick with it at least for a while. Fellow investors if you have any advice I would greatly appreciate it.

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G. Brian DavisPro Member
Investor · Hatboro, PA · Member since 2016 · 3k+ posts · 878 votes
2d

I’d probably stay in your own backyard too. If you’re going to be active in the deal, being close enough to actually see the property and know your contractors is a big advantage.

I also wouldn’t do a flip just to learn if the numbers don’t make sense. You can learn a lot by walking deals, talking to contractors and underwriting properties without putting your money at risk. You may also find that the best strategy for you isn’t necessarily the one with the highest theoretical return. It’s the one that fits your market, your time and how involved you actually want to be.

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  • Divin KanyamaBusiness Member
    Accountant · Seattle, WA · Member since 2025 · 535 posts · 227 votes
    2d

    @Lucas Helliker You have already learned something valuable: the best strategy on paper may not be the best strategy for your life. A market two hours away can offer better ratios, but those returns may disappear once you account for travel, weaker oversight, uncertain estimates, and time away from your family. Returning to an area you know well is not necessarily stepping backward—it may be choosing an operating advantage.

    I cannot speak to the specifics of Chicago, but if conventional BRRRR numbers are difficult in your target area, it may help to look beyond the strategy label and focus on where you can create controllable value. That could include small multifamily properties with operational upside, poor management, below-market rents that can be raised responsibly, or layouts that can be improved without relying entirely on appreciation. If you pursue a flip, I would treat the learning objective as secondary to protecting the capital. Use conservative assumptions for acquisition, renovation, financing, holding costs, and resale value, with enough margin to absorb delays and surprises.

    Choosing a lane makes sense, but I would define that lane by your repeatable advantage rather than by a label such as BRRRR or fix-and-flip. Your advantage appears to be familiarity with your immediate area, proximity, and direct oversight. Pick a narrow property type and geographic radius, walk projects with contractors, build your own cost history, and avoid forcing a deal merely to gain experience. The right first project should both teach you and remain financially sound if the market does not cooperate.

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  • Jimmy Samaha
    Staten Island, NY · Member since 2013 · 98 posts · 35 votes
    2d

    I'd stay in your own backyard too, but go into a North Side flip knowing the margins are thin because you're buying close to retail. On a 500k buy I'd want the all in number (purchase, rehab, holding and closing on both ends) at least 60 to 75k under what you're confident it sells for, since selling costs alone eat 6 to 8 percent. Hard money holding costs run a few thousand a month, so every month of permit delay hurts.

    Since you already know small multis, another option is a tired 2 or 3 flat with rents under market. Do a lighter rehab, bring rents up, refi and hold. You learn the same rehab numbers, and if the market softens you can rent it instead of being forced to sell. Either way, walk every deal yourself with your contractor, that's what actually teaches you the numbers.

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  • Dan Duenas
    Lender · Member since 2026 · 42 posts · 24 votes
    2d

    Lucas — smart move coming back to your backyard. The drive-time math kills more strategies than bad deals do.

    Since you're choosing a lane, pick it from the financing side, because that's where each lane actually lives or dies:

    If you flip: hard money covers purchase + rehab, but underwrite your exit before you buy. On the North Side that means knowing your resale number cold AND having a plan B if it becomes a hold. Thin margins plus a forced sale is the combo that hurts people.

    If you do Jimmy's 2–3 flat play (which I like for you): the refi is a DSCR loan, which qualifies on the property's rent — not your personal income, no tax returns or W-2s. So the only question is whether the rent covers the new payment at today's rates. Run it on current rents, treat any upside as gravy.

    Either lane works if you line up the money in AND the money out before you make offers. That's the real lane: deals where you know your exit on day one.

    Happy to run your numbers on a specific one — Dan

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  • Hossein Sharifi
    Investor · Member since 2023 · 133 posts · 65 votes
    2d

    @Lucas Helliker Learning rehab numbers on a flip makes sense. Just price the tuition first. The usual math is ARV minus rehab minus about 10% for buying, holding and selling, minus your profit. On a $400K ARV with $60K of rehab and a $40K target, max offer is around $260K.

    Most first flips blow the budget on time, not materials. Every extra month on $300K of hard money at 11% is about $2,750, and Chicago permits can add 6-8 weeks on their own.

    One option with 7 units already under your belt: be the lender or partner on someone else's flip first. You'll see real bids and draws without carrying the whole risk.

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  • G. Brian DavisPro Member
    Investor · Hatboro, PA · Member since 2016 · 3k+ posts · 878 votes
    2d

    I’d probably stay in your own backyard too. If you’re going to be active in the deal, being close enough to actually see the property and know your contractors is a big advantage.

    I also wouldn’t do a flip just to learn if the numbers don’t make sense. You can learn a lot by walking deals, talking to contractors and underwriting properties without putting your money at risk. You may also find that the best strategy for you isn’t necessarily the one with the highest theoretical return. It’s the one that fits your market, your time and how involved you actually want to be.

    2Reply
  • Simon W.Business Member
    Real Estate Consultant · Lehigh Valley PA & New York City · Member since 2013 · 1k+ posts · 681 votes
    2d

    Good thread, and Jimmy and Dan covered the margins and financing. The piece I'd add is how a flip gets taxed, because it's different from what you're used to with rentals.

    Flip profit is generally ordinary income, and often self-employment tax too. A $60K profit can easily lose $20K or more to tax depending on your bracket, where a long-held rental sale is usually taxed at capital gains rates. That's why Jimmy's $60-75K cushion should be read as a pre-tax number.

    The bigger risk is that doing flips regularly can get you labeled a dealer, and then the IRS can question the treatment of your other sales too. A lot of people run flips through a separate LLC from the rentals so the two histories stay clean. Worth a conversation with a CPA before the first flip closes, not after.

    Also, on the house hack you live in, the home sale exclusion generally doesn't cover depreciation you took on the rental portion, so keep your allocation of expenses between personal and rental clean from the start.

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  • Aaron ZimmermanBusiness Member
    Accountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes
    1d

    What does your cash position look like?

    Would the strategy on the BRRRRs/flips be to use hard money? Holding costs will eat up profit so certainly something to account for.

    Also from a tax perspective, flips get taxed as self employment income so you may have to pay self employment tax in addition to ordinary income tax.

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  • Nyisha Walton
    Lender · Houston, TX · Member since 2026 · 58 posts · 15 votes
    1d

    Lucas, owning two buildings and seven units gives you a solid base for choosing the next lane. Since you are comparing a North Side flip with another house hack or BRRRR, I would place the financing plan beside the deal analysis before deciding. For a flip, that means modeling the purchase, renovation, carrying costs, extension risk, and a rental exit if the resale timeline changes. For a two-to-four-unit hold, it may be worth comparing conventional financing with a bridge-to-DSCR structure depending on occupancy and the property numbers.

    If you find a property you want to evaluate, feel free to share the purchase price, rehab budget, expected value, projected rents, and capital available. I would be happy to help you pressure-test the financing side without any pressure to move forward.

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  • Matthew MorrowBusiness Member
    Investor · PA - NY - NJ · Member since 2019 · 774 posts · 265 votes
    1d

    @Lucas Helliker I'd stay local too. Getting burned on walkthrough numbers from two hours away is the classic lesson, and being close enough to stop by on a Tuesday is worth a lot. A flip is a solid way to learn rehab costs and build seller relationships, and those relationships are where off-market deals come from. Most of my early deals came straight from sellers. One thing to keep in mind is that a flip doesn't have to stay a flip. I bought a 5-unit in Lewistown as a flip and ended up keeping it as a rental. If the numbers on the exit change, you've got options. Curious to hear how you end up approaching it.

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  • Ana Cortes
    Real Estate Broker · Chicago, IL · Member since 2026 · 7 posts · 0 votes
    1d

    Hi Lucas! Just wanted to connect with you. I'm from the Chicago area as well. I'm glad to hear the house hacking is going great for you! I've been thinking about doing that as well. Let me know if you want to network sometime!

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