BRRR - Does is make sense with single Chicago condo units?

[Luke Shaw]

Hi BP, 

I'm a young professional ready to buy my first piece of property in Chicago. I don't have the funds to buy an entire 2 flat or 3 flat (yet), but I COULD buy just one condo unit if I found the right one. 

My question: is buying a single condo unit in Chicago a financially sound decision that fits into the BRRR mentality, or should I continue saving and renting until I can buy an entire building? As someone who would always prefer to DIY first, the idea of answering to an HOA does not sound fun. I'm also afraid it would sap my cash flow. However, I would love to start building equity and pay rent towards a mortgage rather than burn it on rent, and a condo seems like a good beginner property.

Thanks! 

[Michael Facchini]

Buying something is often better than buying nothing. Typically a 2-4 unit is a better investment than a condo, generally speaking. But if it takes you another few years to save up the funds and/or to get comfortable with that purchase, whereas a condo is within reach now, then the condo is worth considering. While you wait, rates rise and more money goes out the window on rent. So, unless that 2 to 4 isn't too far away, I'd say the condo isn't a bad place to start. That said, you need to buy smart with that condo. They come with their own set of strategy.

Alternatively, if a 2 to 4 doesn't scare you, you could consider certain grants to help with down payment. Hope this helps! Hit me anytime with questions.