All Forum Posts by: Brendan M.

@Steve Kachniewicz

Dam not exactly a pretty picture. I definitely agree where you're coming from though. Chicago has had a lot of issues  and they seem to be getting worse. Hopefully taxes don't continue to increase but not exactly optimistic about it. I would probably just buy one property in Chicago and then move to another lower cost entry point. 

I'm from Chicago so imagine property taxes are much worse than Milwaukee. I am definitely looking at a couple different areas. What location would you be looking at then?

As a quick update, I am definitely more interested in property B. I am getting more information from the seller and plan on making an offer so I'll let everyone know how that goes. 

@Linda Cheng

Thanks for reaching out! I hope so! I looked at three properties today and I plan on making an offer on one so excited about that. I am hoping it works out! I'll post an update soon.  

@Steve Kachniewicz

I plan on owner occupying this investment and then I will probably start investing in Milwaukee or Indiana. Taxes are a big concern. Haven't they always been bad though? Why do you think it's going to get much worse?

Hi @Ronan M.

Good call. I would live in one of the units and my friend would live with me. My friend would pay market rent so I should subtract about $700 or so from my numbers to get a more accurate idea of the cash flow. 

Sorry let me try and be more clear. I should have made it more consistent and easier to understand. So the Mortgage includes the taxes and insurance. 

Monthly numbers Property A

Rental income less expenses - $3567

Mortgage (including taxes and insurance) - $2401

Cash Flow -$1166

Property B

Rental income less expenses - $4002

Mortgage (including taxes and insurance) - $2933

Cash Flow -$1069

@Ryan Canfield

I do like that property a lot better. The backyard area is nice too! I feel I can get a better idea of all the numbers when I ask for documents pertaining to taxes, actual expenses. Is water always paid by the landlord? Is that what you mean by metered?

Oops, 203K loan not 401K (can't get my mind off retiring apparently). The more I look at properties the more the Irving Park area seems to be where I'd like to end up. I don't live too far from there currently and I like the area. I'll let you know what I'm thinking! 

Also, when you bought your properties were you able to get them below list price. I'm curious as to if it even makes sense to try and get a lower number or if the numbers work at the list price to just offer that. I don't want to lose a deal because I am trying to get an extra 10K off but just wanted your thoughts. 

@Ryan Canfield 

Have you taken a look at these properties? Might be moving into your neighborhood. 

Hi, 

I am seeing two 3 unit buildings on Saturday in Irving Park (Chicago) and I wanted to get your guys thoughts on these numbers. Both are 3 unit buildings and it seems like they both cash flow pretty well. 

Property A is a 7 bed/3 bath. Hardwood flooring but would need some work in the kitchen and bathrooms. 

Property B is 8 bed/ 3 bath. Hardwood flooring as well but probably needs some updating. 

I would owner occupy and probably get a 401K loan. I'm thinking each would need maybe 30-40K but I have no experience in that and really just guessing. I like to overestimate costs and underestimate rents just to provide a cushion and to really make sure I'm getting strong cash flowing properties. 

Property A

Purchase Price - $340,000

Total Rental income - $4100 (1200,1200,1700)

Rental income less expenses - $3567

Tax - $5495

P&I - $1777

Ins - $2000

Mortgage (including costs) - $2401

Cash Flow - $1166

Property B

Purchase Price - $439,000

Total Rental Income - $4600 (1700,1700,1200)

Rental income less expenses - $4002

Tax - $5672

P+I - $2294

Ins -$2000

Mortgage (including costs) - $2933

Cash Flow - $1069

Is there anything I am missing? Brie S. sent me a SS that I used for the calculations. Expenses are 13% of the rents. I want to move on these properties quickly if I do like them on Saturday and was hoping you guys could provide some guidance. 

Any help would be appreciated. 

Hi @Gabrielle E. @Bhekizwe M.

Thank you! I'm looking at a couple properties on Saturday and two of them seem to have good numbers but I'll have to see what condition they are in. They need some updating but I think they could easily rent in their current state. I am looking at 3 flats in Northern Chicago so I'm hoping one of these properties will work out but I'll keep you updated. Best of luck and let me know how the investing goes!

I've posted a couple times so far on the forums and absolutely LOVE the wealth of information on here. I wanted to keep a journal of my process to financial freedom through real estate and share it with both beginners and seasoned investors who I'm sure have gone through a lot of what lies ahead. 

To give a quick background, I graduated college in Dec 2013. Two months later, I had my first post-college job as a Recruiter. While living at home, I threw all my money at student loans and within 2 years, I was debt free. I started thinking about how I could live the life I wanted and came across many blogs such as MrMoneyMustache preaching financial freedom. Thinking more about their ideas, it struck me that I didn't want to live on 20% of my income and there must be a better way which lead me to real estate and Biggerpockets. I joined a couple years ago but didn't get serious until about 3 months ago. I started saving up money for a down payment and reading real estate books ( Millionaire Real Estate Investor - Keller, Build a Rental Property Empire- Ferguson, The Book on Rental Property Investing - Turner, and currently reading The Richest Man in Babylon- Clason)

The past couple months I have looked at some properties, 2 SFH and 2 MFH. I had an idea of what I was looking for but was new and just wanted to get my feet wet. Neither of these properties were good deals so I passed. It's important to remember that passing on bad deals is as important (if not more) than finding good deals.

Being a newbie, I have learned a lot already from @Brie Schmidt who helped me change my strategy in my market (Chicago). I was originally focused on 2 unit buildings but those don't cash flow so I have moved onto looking for 3-4 unit properties.  I plan on learning a lot more from Brie (as long as she's willing!) and many other investors who have accomplished what I want to. I have connected with a couple other investors and plan on picking their brains as well to learn and absorb as much as possible. 

I want to track my progress from Day 1 and give updates on properties I've seen, numbers I've crunched, and deals that I've closed (and ones that got away). I will give my thoughts on each deal and financing that I've gone through. My hope is that people can use this as a way to see the process first hand (struggles and triumphs included) and also for me to see my growth as a person and investor. 

I couldn't be more excited about the journey and look forward to sharing with you all! 

HI @Ryan Canfield, I sent you a PM. I'm seeing that as well. I'm still trying to define my strategy. I initially thought I'd start with a two flat but finding it hard to find good deals with those. I like the idea of putting a bit more down to make sure I'm not paying the PMI so I'll definitely consider that moving forward.

I've been looking at properties every day for the past month or so and finding it difficult. The nice thing about this is that I am able to analyze a couple deals a deal so I have a much better (albeit not great) idea of what a good deal is. I am getting much more comfortable on that front but I know it will take some time. I am excited to be going through it though!