Understanding long-term hold deals on Chicago northside

[Mary Arents]

Hi Bigger Pockets Community,

I live in Lincoln Square and am eager to invest in a multi-family property for a long-term hold - ideally on the northside. We would be putting 20-25% down and using conventional 30-year financing. Depending on the size of the down payment, we could take on a property that needs a bit of work.

I have been using the BiggerPockets calculator to analyze deals though I'm having a hard time finding any that have positive cash flow in the first few years. Is this just a function of low inventory, high interest rates, and high taxes? 

I am a newly licensed real estate agent and already have a great lender on my team. If you have experience with long-term holds on the northside and are willing to look at a couple of the deals I've analyzed and share your insights, I'd be very grateful.

In the meantime, I'm starting to think creatively about other strategies - looking for off market deals, pooling funds with friends, etc. I'm also starting to put REI meetups on my calendar - looking forward to connecting that way, too.

Cheers!

[Henry Lazerow]

I have sold a bit over 50 million of the northside 2-4 units so seen lots of day 1 analysis vs long term, they tend to not look great on paper in year 1 but rents ramp up each year and they run under 3% vacancy here so actually bring high returns over the long run. Cosmetic value adds also significantly boost the rents and equity so you can often put $30-40k in rehab and create $70-80k equity for example which snowballs over time.