All Forum Posts by: Mark Ainley

What is the condition of the property....did the turn key operator go down to the studs, is the porch passable by code standards? I would also interview another management company on the south side. This will help you have a back up plan should your relationship with the turn key management not work out and that second management company will give you a small education on what you are up against as we are doing. We won't manage properties for 8% on the south side because it is labor intense. We do 10% of gross along with a $150.00 annual CHA fee, plus the labor & material it costs for the CHA inspection repairs. That is something people forget to take into account. Our CHA inspection costs range around a few hundred bucks on average but we have a few that cost us $800-$900 every year just because either that tenant is rougher on the property or the property has various exterior areas that need to be painted annually to pass on the chip paint rules(Lead Paint or not).

Another thing to understand is tenant portions. When a tenant has a smaller portion that means she has less income which means she doesn't work which means she is around the house all the time which means she is bored, and has people around the house a lot more with more room for management issues and unit damages. We have an easier time collecting $600 per month from the CHA tenants that work vs. the tenant with the $30.00 tenant portion.

I can go on and on....we do have 73 CHA tenants so we are very familiar so feel free to contact if you wish to discuss more. I do want CHA tenants over market tenants any day so you are on the good track there.

I am by no ways discouraging your purchase and I spend a lot of time promoting the opportunity down there to other investors and associates that wonder why we invest there. UofC is growing in ways the public has no clue and is amassing land left and right secretly, Obama's library will end up down there, and the push to connect the South Loop with Hyde Park by the city has lots of momentum not to mention it is affordable and has a lot of room to go up and still be affordable compared to the North Side. We are in this for long term hold so who knows what will happen in next 10 years but so long as it cash flows we don't care.

Truth is I spend time every day trying to expand out portfolio into the suburbs(and we do have a few in the burbs) but it is impossible to find even as close to good cash flow as we do on the south. Before any debt service we are netting roughly $7,500.00 per unit(3 bedrooms) per year with all the associated costs but not including a reserve fund.

For our company CHA is the way to go and if you keep CHA tenants happy they seem to stay and they have a harder time using the system against you. On the other hand once per year CHA will do annual inspections and it will cost u a few bucks to ensure you pass not to mention if the property manager charges for the inspections which we recommend having someone there.

Our CHA turnover is minimal. It is a lot harder for a CHA tenant to up and leave and they can never just skip out on you.

60637 has a wide variety of areas good and bad. Are your tenants section 8 or market tenants? We do manage 56 units in that zip code. We are not fans of any streets in the 7000 blocks (we do have some there though)east of King Drive because the areas are rougher (sure crime maps will show that) and less quality tenants to choose from.

We use both firms below for the last few years. For a special project you will get more personal attention with Dennis Nolan.

Dennis M. Nolan, Esq.
Law Office of Dennis M. Nolan, P.C.
221 West Railroad Avenue, Bartlett, Illinois 60103
630.213.7700 (T); 630.213.7735 (F)

or

Raila & Associates, P.C

(312) 587-9494

Welcome, there are many investors from the area such as myself. Many new and seasoned to talk to.

Welcome to BP fellow Bartlett investor.

I have never heard or used them but we use Andrew Maratea for our landlord work and evictions. Their firm is young and aggressive and they use a great process server.

[email protected]

(847) 924-7498

Welcome!! We manage/own many multi units and SFH in Chicago so any advice, templates, leases, contacts, or just want to run something by me please feel free to do so.

I have one also including our riders too if you want it. There are no required changes for 2014 other than the interest rate. Feel free to email me and I can send you what we use. [email protected]

Investing on south side is tough and the roller coaster statement is a fact but the prices currently(over last few years) have never been this low even in some better areas of the south side. The recent bubble was created by mortgage fraud but mostly in past and again in the future will be based on investor speculation and flipping.

A property manager is everything down there. We have been buying investments since 2008 and have built a new business around managing our own properties cause I don't think I could trust anyone else to do the job. Collections, maintenance, & City ordinances are so more labor intensive then even the suburbs. We do have about 75% section 8 so we are able to keep tenants around a few years at a time and amount we are trying to collect is reduced. We spend more money on maintenance and upkeep to our buildings but it pays back dividends with limited turnover. One good thing about southside is there are a lot of slumlords and most tenants have been with one or two in their life so they do appreciate a good home when they get into one.

Buy low and sell high! The signs are always there for turning markets so it isn't hard to know when to sell. Much harder to manage. As an investor from out of state or area always suggested to partner in with an active operational partner that can oversee day to day.