House hack multifamily property in Chicago?

Question

Hi everyone,I'm looking for a multifamily in the Chicago area that I can house hack for my first property. Longer term, I'd like to build a large portfolio of multifamily properties in the Chicago area. Does anyone have any suggestions for the best neighborhoods to start with (safe, likely to appreciate, ability to commute downtown)? I have been looking in the Tri-Taylor and North Lawndale areas, but I'm wondering if there are better areas I should consider. As far as budget, I would prefer to stay under $400,000 for the first property. More generally, it would be great to connect with more Chicago area BP members. Please let me know if you would like to connect!Thanks!

Bilal Hussain · Answer

@Mylan TraylorHey great to connect with you! I'm from Chicago as well and am currently working on my first house hack through 203K FHA. We're pretty much in the same boat as my price range is also $400-450k!I've placed an offer for a few only to have it rejected (but i've learned something new with each.) I'm aiming for mostly 3 units or AT LEAST a 2 with an in-law arrangement in the basement or attic so we can maximize rent potential. Here are my top neighborhoods for multi-units in this price range:Hermosa (Very close to Logan square which is slowly being revitalized with lots of new rehabbed homes) Range is $350k-$425k. However it lacks major big box stores, fast food restaurants and boutique shops. I predict next 5-7 years will have a great upside. Avondale - Just north of Logan Square and lots more pockets of nicer neighborhoods. Price range is $380k-$475kHumboldt Park is also a great one for multi-units however, you'll either get turnkey properties or full gut rehabs. Turnkey price range is $320k-380kAlbany Park/Irving Park - We recently expanded our search this far north because after driving through, we realized that there are lots of homes being remodeled and its close to many stores/restaurants - overall a more lively area. Our current property we're about to put an offer on is in hereI hope this helps and good luck on your search friend. Let me know if I can help in anyway.

Ricardo Delgado · Answer

@Mylan TraylorLove your strategy, that’s exactly what my thought process was when I started (still Fairly new). I currently own 2 multi units and in contract for a 3rd. The two areas i invested in are south lawndale (little village) and West Humboldt Park so I might be a little biased but I really like these two areas and have had great tenants.Ive also considered McKinley Park because it’s close to downtown and I55 and East Garfield Park. One thing to consider is a block or two can make a big difference in Chicago, especially in some of these areas. Feel free to reach out if be happy to help in anyway I can.Good luck!

Shamar Gregg · Answer

@Mylan Traylor One area I did not see mentioned is North Austin and some parts of South Austin. I purchased a 4 unit in North Austin for 410K (all within 3 weeks after posting), rented great because it's across from Oak Park (nice area), and the best part, low taxes. You can reach out to me for good areas in Austin and could also tell you my rental amount numbers to see if it work for you too.

Sarita Scherpereel · Answer

@Mylan Traylor Thanks for the @Jonathan Greene. A Couple areas that people don’t talk enough about are Jefferson Park and Portage Park. While they do have a bit of a Suburban feel you can find a lot of mid-century modern buildings there that offer better floorplans and layouts. Then some of the Victorian styled properties that you see in the other areas.￼ I will say to cast a wide net because you don’t know where the numbers might lead you. And obviously depending on your commute that might help you narrow some of these places down a bit. I also really dig the numbers in Hermosa if you’re willing to take a bus to a train home. If you’d like to chat more let me know. Best of luck!

Jonathan Greene · Answer

Connect with @Sarita Scherpereel. She knows all the spots for the best house hacking.

Trevor Fritz · Answer

Welcome and best of luck! For under $400k you may find it difficult to find a place that is not going to need a significant amount of work. Areas near where I live that you could begin searching is Irving Park, Avondale, Humboldt Park, etc. I looked for about 2 years and came up empty on finding a place that I felt was a great (not just good) investment. I ended up buying a 2 bed condo that needed some work and was well below budget and I am using it as $$ saver opportunity.

John Warren · Answer

@Mylan Traylor welcome to the forums! House hacking in Chicago is a great way to get started, and you can often times find good quality properties that will allow you to live for a reduced amount in comparison to renting while still building equity and setting yourself up for success. You are looking at two neighborhoods that are pretty different. Are you from Chicago originally? I would think long term about where you want to live first, and then work backwards from there. If you are looking west, maybe consider Little Village (South Lawndale) where prices are still a bit cheaper or McKinley Park. West Humboldt Park or the areas around MIdway could give you some options too.

Nate Grabner · Answer

Hi Mylan, I'm in the same boat as you and was wondering if you ended up making any offers? Would love to hear how it ended up going.

Aaron Zimmerman · Answer

I'd be happy to connect with you. I just started house hacking in Irving Park in December and would love to share my experience with you. Feel free to connect.

Jonathan Klemm · Answer

@Mylan Traylor - I am definitely happy to connect. Lots of good information above from some smart people. As far as neighborhoods go I really like Bronzeville, Washington Park, and Hyde Park. That area is definitely in the path of progress.I always like to ask newer investors what their end goal is and what their "why" is?