Looking to House Hack in Chicago for the first time

[Sebastian Nadal]

So, earlier this year I bought a 2 bedroom / 2 bathroom condo in Chicago. This was my first time ever buying property. The condo is in Rogers Park. I'll admit, I might've bitten a little more than I could chew, but I got anxious and I just wanted to have my first property in the city that was up north. 

I've been able to afford my payments so far without much issue. My principal/interest, escrow, and insurance is 1570, and my HOA is 306 and it includes water. I cannot fully rent out my place as it has not been 2 years since I started, but I can rent out a room.

After looking around rent prices, I have reached at $900. I think that is a fair price and that will help me with my breathing room and hopefully help pay off my place faster, or at least so I can reach 20% equity so I can stop paying $110 a month in PMI haha.

I'm obviously going to be checking credit score, making sure tenant has a stable income, no criminal background, etc. But since I'm young (24) and really new to this, I want to make sure I'm not missing anything glaring. Anyone have any suggestion for me? Thank you.

[Sebastian Nadal]

Quote from @Victor So:

Hey @Sebastian Nadal ! You’ve got the right idea! For now, it Looks like your roommate/tenant can cover half of your mortgage (plus hoa fees). Definitely screen properly and don’t cut corners! Are you planning to rent the entire unit at the 2nd year mark? My only concern would be whether or not, you’d be able to cash flow. If you’re not able to, then it may be better to sell the condo, take the profit (if you have some equity in the condo) and put it into a multi-unit to househack again. Note - if you live in your property for 2 years out of the last 5, then you don’t pay taxes on the profit. 

 I do plan to rent the entire unit at the 2nd year mark. I probably plan to go back home with my mom so I can save faster. Ideally I wanted to live in Lake View as that's my dream neighborhood, but I just didn't have the funds/income. I also wasn't aware of househacking really, not sure if I can do it in that neighborhood, but I'll do my research.

As for making a cash flow, looks like it'll be a slim profit? 1876 for the mortgage and HOA, and it looks like rent in that neighborhood is around 2-2.2k. I know that's not a huge cash flow, and any repairs could make me break even. But that's not too bad for me. I like my place and I feel rent will go up in this area as this is considered one of the few affordable neighborhoods up north. Plus Loyola with all its new construction. Once I reach 20% equity I'll request to remove PMI so that would free up $110 a month.