Investing Out of State

[Cynthia Sigler]

Hi BP Chicago! A little background: I currently live in Los Angeles but lived in Chicago for quite some time - specifically the Logan Square neighborhood which I loved. I own my primary residence in LA and have been getting ready to hopefully secure a HELOC to fund an out of state investment property (my first!). As much as I would like to "invest in my backyard", it doesn't really make sense here given the entry price is 500-600k for a SFR and I will probably be working with 80-100k on the HELOC and am interested primarily in multifamily properties. Now, I have heard many negative things about choosing Chicago as an out of state investment - mostly having to do with slow appreciation and the red tape that comes with the City. However, its definitely the one place I have a "competitive advantage" in through my familiarity with the different neighborhoods, rent prices, and contacts there. My question to those who are experienced and I am sure successful in the area despite its challenges: given my situation would you recommend pursuing Chicago as an out of state investment? If not, would the suburbs be a good alternative, or would it be better to choose a completely different market, even if that means no competitive advantage? I did go to school in northern Indiana and am considering that as and option as well, if anyone has any experience there. Many thanks!