All Forum Posts by: Bob Floss II

@Patrick Britton Several of my clients have @Jason Donajkowski manage their properties and he does good work. 

@Brie Schmidt Brie hit on a good point here that is often over looked. Yes, the Alderman I've spoken to are going to use this to fast track a lot of basement units that should be legal but owners have avoided the zoning process. However, those units have typically passed city inspection and are up to code, they just haven't been zoned properly. Hell, I have some that passed CHA inspection.

When I talk to a client about legalizing a basement, I tell them to stop and go talk to an architect and contractor that's experienced with this type of work. The price tag to bring a basement unit up to code can be staggering depending up on your building. Are you ready to spend $25K? What about $50K? What about $100K??

I had a client purchase a building with the intention of putting four legal units in the basement. We passed all zoning roadblocks and the project was a full go. Except the contractor told him it would cost $50,000 and it turned out he had never done a basement build out before and it was going to cost $200,000.

I'm not trying to scare anyone away, but I want to make sure you understand the financial commitment.

@Funmilola Oladini Sorry to hear about your situation. Considering a deconversion is a good idea given the cost of repairs. That area is in high demand for investors and you may get a higher value for your units together as a building rather than try to sell individually. If the other owners are not in agreement, you will have to look into getting financing for the special assessment and have the work done immediately before it gets worse. Depending upon the cost of the units, you can also look into buying your neighbors units and deconverting yourself to keep as a rental property. However, if this is your first time getting involved with an investment property, I wouldn't recommend a project with repairs of this size. 

@Brie Schmidt I've heard some landlords threaten to never buy properties in Cook again, but I think its a knee jerk reaction. There is still a strong market in Chicago even with the RLTO. It's going to hurt the suburban apartment complexes that have gotten by using a customized lease with lots of built in penalties for tenants. 

@Brie Schmidt Cameras are allowed in the common areas of a building, however they should never be directed towards the door of a unit as that can be viewed as an invasion of privacy and quiet enjoyment of the unit. The tenant is correct that your other tenant having footage of the back door of their unit is inappropriate and a form of harassment. I'd tell him to take it down and you will install your own camera that abides by privacy laws. 

@Rada Chapkis Work backwards. Determine the ARV, subtract out closing costs and estimated rehab, and you'll reach your purchase price. You'll need to take a cushion off the purchase price to incorporate your fee. Try not to under estimate your rehab costs.

@D Higgs Top priority for a private investor is their trust in you to complete the project and return their money. They don't want you to disappear or leave the project incomplete and their money is tied up in the property. That's why investors want someone with skin in the game. If they put up all the money, you have the ability to walk away with minimal loss. 

This isn't a legal theory, it's making a bluff and hoping the tenant doesn't call you on it. 

@Brie Schmidt Good question, I'm not sure if there is a threshold amount when a move in fee becomes a security deposit. Although a high move in fee plus a high move out fee feels like something that a crafty attorney would interpret as a security deposit. It may end up a moot point in the future, the proposed Cook County RLTO, which could be used to change the Chicago RLTO, calls for banning move in fees.

@Megan Gleeson Where are you located?