Valparaiso, IN · Member since 2015 · 5 posts · 2 votes
I have been looking at Multi units in Chicago. Specifically in the Logan Square, Ukrainian Village, West Town, and Avondale neighborhoods. My question is, what type of cash on cash return should I consider a pretty good return on my money? Thanks for any advice. Dave
Real Estate Entrepreneur / Investor · Chicago, IL · Member since 2016 · 688 posts · 367 votes
9y
Dave K. How's it going. I have a couple of investors that invest up north in chicago. It's fine if they are aware of the limited cash flow and appreciation ceiling. Those areas are very expensive because they are well developed. The property taxes are high as well. I wouldn't recommend any investors invest there for cash flow since there are better opportunities available on the west and south side of chicago as well as the suburbs as well. But if you are head set on investing up north than that's fine too lol do what you want . For the most part I only send 11% cash on cash return or better to my investors and that's difficult to find in those areas of North chicago. Now if you are trying to flip up north that's different. But even then it's hard to find a good one because I'm sure if there are good deals located up north chicago it will be gone in a day or two. Anyone can PM me for tips, advice or looking for assistance. Thanks
Dave K. How's it going. I have a couple of investors that invest up north in chicago. It's fine if they are aware of the limited cash flow and appreciation ceiling. Those areas are very expensive because they are well developed. The property taxes are high as well. I wouldn't recommend any investors invest there for cash flow since there are better opportunities available on the west and south side of chicago as well as the suburbs as well. But if you are head set on investing up north than that's fine too lol do what you want . For the most part I only send 11% cash on cash return or better to my investors and that's difficult to find in those areas of North chicago. Now if you are trying to flip up north that's different. But even then it's hard to find a good one because I'm sure if there are good deals located up north chicago it will be gone in a day or two. Anyone can PM me for tips, advice or looking for assistance. Thanks
I am an investor on the north side of the city and I agree with what you're saying. I invest more for long term equity growth and am willing to sacrifice the good cash flow elsewhere because my wife and I both have pretty decent paying W2 jobs that we don't plan to leave any time soon.
I think to make cash flow work solidly on the north side, you need to approach places where you can force equity through rehab or finishing unfinished space. Finding a turn key property on the north side that cash flows is unlikely IMO.
I have been looking at Multi units in Chicago. Specifically in the Logan Square, Ukrainian Village, West Town, and Avondale neighborhoods. My question is, what type of cash on cash return should I consider a pretty good return on my money? Thanks for any advice. Dave
If you mean Cap Rate, which is different than Cash on Cash Return, then a good CAP Rate in the area's you're looking in would be 5%. Even that may be high.
Rental Property Investor · Honolulu, HAWAII (HI) · Member since 2011 · 4k+ posts · 2k+ votes
9y
A good cashflow for turn key is 8-10 percent cash on cash. But make sure you work with someone with the numbers on a spreadsheet. Chicago who high taxes and FL as high insurance that is a little hidden to the newbie.
Attorney · Northbrook, IL · Member since 2017 · 719 posts · 549 votes
9y
A stable CAP rate is typically 4% to 5% for a nice area with no rental issues. If you are willing to venture into some less developed neighborhoods or areas that demand more attention for rent collection, you can find a CAP rate around 10% to 12%.