Rental Property Investor · Aurora, IL · Member since 2019 · 12 posts · 0 votes
I am hoping to hear from people that have been renting properties in Rockford Illinois, DeKalb Illinois and/or Beloit Wisconsin.
I plan to buy a 2-4 unit building by the end of the year possibly 2 buildings by then. I like the idea of multifamily over single family but I will go whichever way the money works out better. I am looking to target these areas because properties are cheaper, taxes are cheaper (not really in DeKalb), and I feel like I should be able to make a few properties work for me. I know these areas are not great areas and that is why everything is cheaper but I figure... the people in these town need to live somewhere!
Plus I thought it would be interesting for people investing in the same towns to have a conversation about their experiences.
Rental Property Investor · Winnebago, IL · Member since 2013 · 4 posts · 2 votes
7y
Piggybacking on Craig's comment above, you may think the taxes are low but it's a high percentage. Rockford proper is 5%, so a 100,000 house will cost you $5k/yr. Remember that the taxable value is set by the assessor, which may count your purchase price or what they will appraise it at by the neighborhood. Lots of local terms and conditions apply with this. The rest of the county may be around 4% Ptax. Purchase price may be low here but some of the holding costs are higher, percentage wise. A 1% deal here may lose you money if your financed.
Bottom line, where ever you invest- do your homework and know what your getting into.
Investor / Real Estate Agent · Aurora, IL · Member since 2015 · 170 posts · 42 votes
7y
@James J Strnad I am curious on Dekalb and Rockford as well, rents are pretty low there so the big benefit is the low purchase price. I love multi-family buildings, I have 2 in Aurora and have had 0 vacancies and evictions.
Investor · TN · Member since 2014 · 508 posts · 167 votes
7y
I invest in NE Rockford and Loves Park and am part of a couple of investor groups that are finding deals. The prices are decent and rents have been increasing but make sure you account for the high tax rate. The listed inventory has been low for years causing homes to just recently appreciated above 2007 prices.
Rental Property Investor · Winnebago, IL · Member since 2013 · 4 posts · 2 votes
7y
Piggybacking on Craig's comment above, you may think the taxes are low but it's a high percentage. Rockford proper is 5%, so a 100,000 house will cost you $5k/yr. Remember that the taxable value is set by the assessor, which may count your purchase price or what they will appraise it at by the neighborhood. Lots of local terms and conditions apply with this. The rest of the county may be around 4% Ptax. Purchase price may be low here but some of the holding costs are higher, percentage wise. A 1% deal here may lose you money if your financed.
Bottom line, where ever you invest- do your homework and know what your getting into.
Investor · Nipomo, CA · Member since 2014 · 366 posts · 401 votes
7y
I've been looking at Beloit a lot lately and even helped another investor purchase a SFH recently. My main investing partner has quite a few doors there as well. He just recently started a PM company with another investor to handle their growing portfolios, as well as help other investors in the area since there is not much in the way of great PM options.
The inventory is there along with renters looking for housing. Definitely worth a look.
In case you'd like to reach out, the partner I eluded to is @Dave Corfman. Another investor worth asking abut Beloit is @Kole Kingslien.
Rental Property Investor · Chicago, IL · Member since 2019 · 5 posts · 3 votes
7y
@James J Strnad and @Jack Medford - I started giving DeKalb and Beloit a look recently too. I'm looking to do my first deal and have been really focused on the numbers and not making the error of overpaying for my first property. As a result, I'm being pushed West from where I reside (downtown Chicago) and focusing on areas with a more attractive tax profile. It's amazing to me how unattractive a lot of the Chicago area is from an investment perspective if you focus on Cap Rate and Cash on Cash Returns. I'm not trying to say you can't make money by investing in Chicago, but it sure seems difficult to start out there.
Rental Property Investor · Aurora, IL · Member since 2019 · 12 posts · 0 votes
7y
@Kenneth Garrett how is renting to students. My son will very likely go to NIU (or somewhere) and I am planning to find something to buy and rent out while he is there to cover his living costs.
@Craig Wilcox how many properties do you have? Single family or multi? What are the trends looking like? If you don't mind.
James,
We have and manage a mix of SFH's and plexes. Our turnover has been minimal and quick to fill. Tenant screening is critical as there are a lot of inquiries from people that do not qualify.
Rents, as well as home prices, have been increasing steadily for the last few years. This month has been crazy as there were about 500 homes flooded in MP and Roscoe. Many of those homes were rentals removing supply from the market, at least temporarily.