Chicago house hackers: what does your 2 flat really cost you to live in?

Question

I'd love to hear real numbers from people who have done this.

A lot of first time buyers in Chicago start with a 2 flat. That's how I began as well.

For me, number that matters most isn't cash flow. It's what it costs you to live there each month after the other unit's rent comes in. Then put that next to what you paid in rent before.

If you've done it, share any of these:

• What you paid in rent before you bought
• What it costs you to live there now, after the tenant's rent
• The neighborhood and if you are glad you chose there.

What you paid in rent before you bought

What it costs you to live there now, after the tenant's rent

The neighborhood and if you are glad you chose there.

Diana Khan · Answer

@Dan Nelson, I like how you're looking at what it actually costs someone to live in the property after collecting rent. I don't have firsthand Chicago two-flat numbers to share, but I'd also want to account for repairs, vacancies, and maintenance when comparing the monthly cost with renting. Those expenses can change the picture quite a bit.

I'm a real estate attorney, broker, and investor based in Maryland, and I work with landlords and property owners on leases, contracts, and real estate transactions. I've seen how important it is to understand the rental agreements and the responsibilities that come with owning an investment property, even when you're living in one of the units.

Thanks for starting this discussion, @Dan Nelson! I'd be interested to see what Chicago owners share about their actual numbers. Happy to stay connected!

Paul De Luca · Answer

@Dan Nelson

• I haven't paid rent since 2018/2019 when I started house hacking (I think it was around $1200 for a 2 bed/1 bath so only about $600 for me).
• I'm house hacking a 3-unit property with the other two units rented. Last year after all income & expenses (including mortgage interest and depreciation) my "loss" on paper was about -$13k.
• I'm living in Portage Park. Overall I like the area, however I'm in the flight path for O'Hare so I do find the noise from the planes a little annoying.

I haven't paid rent since 2018/2019 when I started house hacking (I think it was around $1200 for a 2 bed/1 bath so only about $600 for me).

I'm house hacking a 3-unit property with the other two units rented. Last year after all income & expenses (including mortgage interest and depreciation) my "loss" on paper was about -$13k.

I'm living in Portage Park. Overall I like the area, however I'm in the flight path for O'Hare so I do find the noise from the planes a little annoying.

Adam Tafel · Answer

Not a Chicago guy, but I've helped hundreds of people with this in the Twin Cities. I actually recommend focusing on cash flow upon move-out because 90% of my clients will not be owner-occupants for the majority of their ownership. Reducing housing costs while you occupy is great, but the long-term goal is to purchase a cash-flowing asset. Having said that, many of us are paying $1,200 or less for a decent two- to three-bedroom unit and enjoying all the other benefits of real estate investing along the way.

Jonathan Klemm · Answer

@Dan Nelson Love the way your framed it! Living cost after other unit's rent is a better yardstick than cash flow. Comparing it to what you paid in rent before makes a lot of sense.

Chicago house hackers: what does your 2 flat really cost you to live in?

Chicago house hackers: what does your 2 flat really cost you to live in?

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