What are general things I need to know

Question

Currently living in IL Chicago suburbs area , and have a huge desire for real estate in general inside my heart . What are a couple of must knows when it comes to investing in Illinois or anywhere at that . What are books you would recommend as far as getting my knowledge up in this field . And as far as my goals for a clear picturer of what I want , I would like cash flow

Seth McGathey · Answer

@Moises Bonilla Not that it matters because Lauren's response is helpful and it is kind of her to respond. But this response took 15 seconds for ChatGPT to write. The almost word for word summary of your question at the top and the use of dashes throughout are a dead giveaway. Just be aware that a lot of people will just throw a generic ChatGPT response on here. They can be informative but it is good to know when you are getting a real persons views and when you are getting ChatGPTs views.

Aaron Zimmerman · Answer

Must knows: you have to be aware of landlord tenant laws in Illinois. Bad tenant selection will kill cash flow and returns on the property.

buying for cash flow rarely results in cash flow. What I mean by that is buying in marginal areas with lower priced houses does not typically work compared to buying properties in better areas. I would follow some of David greenes philosophies here.

books: rich dad poor dad, set for life, and Brandon turner books on managing rental properties.

resources: straight up Chicago investors, local real estate meetups

you've come to the right place and you're asking the right questions.

Marcus Auerbach · Answer

Go to the BP store and pick what interests you, Brandon Turner is a good start. The problem with your stated goal of cash flow is that real estate is not very good at cash flow. The real super power is generating equity, which is much bigger than cash flow. It's like buying dairy cows, because you want to produce leather.

Most people get this wrong in the beginning and therefore approach REI the wrong way and build their business around a faulty assumption - huge strategic mistake. Play with the BP calculator, use a hypothetical 1 million portfolio and see how that plays out over 10,20, 30 years.

If you want cash flow, buy or start a business. By design a main output of a business is cash-flow. It does not matter if you are selling stuff online, buy an airstream and convert it into a mobile coffee shop or pressure wash houses. You scale by having W2's work for you. And then you invest that cash into RE and use the RE to tax shelter the biz.

Lauren Robins · Answer

Hi Moises!

It’s exciting to hear that you have a strong desire to dive into real estate, especially with a clear goal like generating cash flow. Since you’re currently living in the Chicago suburbs, you’re in a region that offers a variety of real estate opportunities—ranging from single-family homes to multifamily properties—but it’s also important to understand the unique challenges that come with investing in Illinois, as well as the fundamentals that apply anywhere.

One of the first things to know about investing in Illinois is that the state, particularly in Cook County and the city of Chicago, tends to be very tenant-friendly. This means there are strict regulations around evictions, lease agreements, security deposits, and required maintenance. Before you buy your first rental, it’s crucial to get familiar with the local landlord-tenant laws in the specific city or suburb where you're looking. Violating rules—even accidentally—can lead to expensive legal issues. On top of that, Illinois has some of the highest property taxes in the country. These taxes are not only high but also inconsistent across counties, so make sure to account for tax increases in your cash flow projections and learn how the property tax appeal process works, especially if you're investing in Cook County.

Another must-know is how to evaluate cash flow potential. A basic rule of thumb investors use is the 1% rule—ideally, a rental should bring in monthly rent equal to 1% of the purchase price (for example, a $150,000 property should rent for around $1,500 per month). While this isn’t a hard rule, it’s a good starting point when screening deals. That said, you’ll want to go deeper by running full deal analyses that include taxes, insurance, maintenance, management fees, and possible vacancy periods. In Illinois, especially in certain working-class suburbs, it’s possible to find properties that cash flow well, but you have to be diligent in your research and budgeting.

It’s also important to start building your network early. Real estate is very much a relationship business. Networking will help you find off-market deals, meet reliable contractors, and potentially connect with mentors or partners.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.

Moises Bonilla · Answer

@Seth McGathey not the chat gpt mentors :( understood thank you for looking out

Seth McGathey · Answer

Some key points. 1. Illinois taxes tend to be high, so watch out for that. (Part of why I live in Wisconsin now instead of Illinois). 2. The bigger pockets podcast is a great resource for quickly gaining knowledge. I listen to it anytime I am in the car, cooking, cleaning. 3. Most people when they are first starting out want cashflow. Once they get more experience they usually start to want appreciation/tax benefits. Then when they no longer care about growth and just want to maintain, they start caring about cashflow again. The reason for this is cashflow at the start seems like the ticket to an easier life. But getting a few hundred dollars each month is great, but a house appreciating thousands of dollars tax free and at the same time lowering your taxes is way more valuable. Especially if you are looking to buy more properties. But when you don't care about getting more properties, then cash is king because you can just start living off that cashflow.

Feel free to ask more pointed questions if you want more details! Good luck!

Allan C. · Answer

The issue with Chicago burbs is plentiful land, so appreciation is limited. The good thing about Chicago burbs is good schools, especially in the SW where you're at. You're basically investing for cash flow, so you'll need to find properties that are newer and don't have much deferred maintenance.

if you want to invest in the city, study the CRLTO extensively as you are highly exposed with strong tenant laws.

Ned Carey · Answer

@Moises Bonilla You must know what you are doing before you move ahead. Despite what you have heard real estate is extremely risky. The cool thing about real estate is your risk drops dramatically with your knowledge.

The problem is many of the things you should know like the law regarding real estate, or how to read and understand contracts is boring and too much like work. @Don Konipol writes about learning the fundamentals all the time.

Learn how to evaluate deals

Learn your market inside and out

learn the law.

That is a start

Moises Bonilla · Answer

What are the benefits of being a person with a lot of equity

Moises Bonilla · Answer

@Ned Carey understood !!

What are general things I need to know

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