Is Humboldt Park a good area to buy a multi family?

Question

Looking to buy my first duplex in 2022 and was wondering what are the best areas for both cash flow and appreciation to consider in the Chicagoland Area? Thank you in advance.

Paul De Luca · Answer

@Angel Moreno

If you're house hacking, it depends on what neighborhoods and blocks you're comfortable with. In Humboldt Park, I've found south of Grand and Division is a less desirable area than north of there. During my own house hack search this year I visited a property at Augusta & Saint Louis Ave and was turned off by the area. Then I drove west on Augusta and then south on Hamlin and wasn't impressed by the area so I passed on the property. Look at properties online and drive around the area to see if you're interested.

In addition to the areas @Jonathan Klemm mentioned for house hacking you should also explore Belmont Cragin, Norwood Park, Edison Park, Portage Park, Jefferson Park, and Berwyn.

Angel Moreno · Answer

@Jonathan Klemm I’m currently waiting for my house to close as I am selli bf to my tennants. I expect to profit around 34k and want to use that money to house hack. If I can manage to do it by the end of the year it would be the most ideal of situations.

What are some areas you recommend to househack in the chicagoland area? I’m also looking into lake county. Thank you.

Tony Angelos · Answer

@Angel Moreno depends what you mean by good and how you qualify a reasonable rate of return and an acceptable cashflow. @Paul De Luca recommended some good ones and there are others still, but with a house hack you also need to consider how you will like to live there.

• 1. Is it convenient to get to work from there?
• 2. Do you need to be close to specific highways or transportation lines?
• 3. Do you need to be within a certain proximity to family members?

These are only questions you can answer and I'd be happy to talk to you about them further.

In regards to financing, an FHA loan has limits on loan amounts and you'll need to talk to a lender about the best way to utilize your funds. Freddie Macs Home Possible loan program allows 5% down for owner occupant 2-4 units, and it's a conventional loan technically so costs are a bit more friendly than FHA if you can qualify for it.

Sue Hough · Answer

@Angel Moreno I’ve invested in Englewood in the past and had good luck about 15 years ago. I then pulled out for personal reasons. Currently I see the area as very promising and am investing there again. The area is on a block by block basis. Please make sure you look at each block independently, also look at it at various times of the week, for example make sure to stop by on a Saturday afternoon, stop by in the middle of the day and so forth. You want to make sure your block is stable.

If you have some time on your hands and can wait a little bit, I think you’ll be very happy with the results. Good luck

Angel Moreno · Answer

@Jonathan Klemm yes I’d like to make some connections with investor friendly agents that work in the Chicago area. Thank you.

Jonathan Klemm · Answer

@Angel Moreno -That's awesome.....good luck with the closing, I am sure it will go smooth.   $34k should be more than enough to get you going on an FHA 3.5% loan for a house hack.  If you used all of it your buying power would be $900k plus but finding a building up in that price range is rather difficult when you have to use the self-sufficiency test.

Chicago Areas that I still like that that you can find some decent deals would be Bronzeville, Washington Park (if you are okay with southside), Hermosa, Avondale, West Irving Park, etc.  In my opinion, anything close to the blue like is a really good long-term play.  If you don't have an agent or lender (that specifically works with investors! this will make difference) you are working with I can definitely provide some great contacts.

Jonathan Klemm · Answer

@Angel Moreno - I personally love Chicago's Humboldt Park neighborhood, but it's pretty far gentrified and is pretty pricey at this point.  Sounds like you are going to do a househack which is an awesome move and I'd highly recommend.  It will just be tough to use some of the low down payment loans i.e, FHA in the nice nw Chicago neighborhoods.

If you are doing a 2 flat that will be way easier than finding a 3 or 4 unit.  That's what I did personally and it has turned out pretty great.

Any chance you can buy sooner in 2021?  With winter coming sometimes you can find some nice deals.  Let me know how I can help.

Is Humboldt Park a good area to buy a multi family?

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