1st Rental Property in Wicker Park, Chicago, IL

[Nick Brown]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $205,000
Cash invested: $14,250

Bought this 2/1 that was undervalued. Purchase price should've been around $230k. Currently, renting out the other bedroom for about $1070/mo. I think I would cashflow about $200/mo if I rented the entire unit out. Also, bought almost all the furniture in the apartment for $500 as well.

What made you interested in investing in this type of deal?

The Cash on Cash ROI is 16.3% if I rented the whole unit out and received $200/mo in cashflow. However, I am renting 1 bedroom out and living in the other, receiving almost $13k/yr and I only put down $14.75k.

How did you find this deal and how did you negotiate it?

I had a great realtor and I stalked Zillow and Realtor.com for months.

How did you finance this deal?

401k loan for $10.25k and cash for the $4.5k.

How did you add value to the deal?

I fixed minors things such as the caulking in the bathtub, added new fans, new lights, not much else.

What was the outcome?

I made great money and I plan on holding this unit for a long time. I also realized that taxes are terrible in Chicago. I plan on purchasing more property in the Fort Myers, FL area.

Lessons learned? Challenges?

I lucked out as this was pretty smooth sailing. My renter is amazing, pays on time for everything.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Matt Liss with Mark Allen Realty in Chicago.