All Forum Posts by: Christopher Boyle

Hi BP community!

My name is Chris, I'm a new BP member located in the Chicagoland area, and I'm super excited to get involved in the Bigger Pockets community! The amount of information I have learned from you all over the past 6 months has been absolutely incredible, and I'm so thankful for everyone's willingness to help and teach. As I continue to grow and learn, I plan to do all that I can to give back and/or pay-it-forward. Since I discovered the podcast and this site, I’ve been practicing a rigid morning routine, going to local meet-ups, and flooding myself with real estate, marketing, or mindset education wherever I can find it.

I am 31 years old, married, have a degree in pharmacy, and spent the last 7 years working in a hospital caring for patients and leading healthcare teams. I officially started in real estate in 2013 with the purchase of a 4 unit property in La Grange Park, IL.  I still live in one of the units today, and rent the other three, which my wife and I have slowly renovated over time. Regardless, I still consider myself a complete beginner, and am prepared to learn (or re-learn) everything from the ground up.

I've recently reached a major turning point in my life, where I decided to commit to building a real estate business, instead of continuing to focus on my pharmacy career.  I'm currently in the process of making that transition.  I'm grateful to have learned some valuable life lessons along the way.  If anyone needs help deciding between progressing down the leadership/corporate pathway versus real estate, I'd be more than happy to share my experiences.

Although I have my investment roots in the Chicago suburbs, I'm struggling with whether to continue investing in Chicagoland, or focus my energy and efforts on a better opportunity long distance.  I'm also struggling with exactly how to evaluate and identify a strong market with data to back up the conclusions.  I'd be very interested to hear your thoughts, or resources you've found on either of those topics!

I'm thrilled, and feel lucky to be a part of this awesome community.  I can't wait to connect with you all, learn, and grow!  Feel free to message me at anytime, and if you're local, I'd be interested in meeting up for more conversation.  And if I can help in any way, please don't hesitate to ask.  Thank you for being the most helpful, influential, and inspiring community on the internet!

All the best,

Chris

@Scott Passman Great introduction; everyone has to start somewhere!  I only have 4 doors under my belt, but am located and invested in the western Chicago suburbs.  Would be happy to connect and provide any insights that I can.  I am similarly in the same location dilemma for my next investment -- to stay in Chicagoland, or look to Wisconsin or Indiana for better opportunities.  Although there is a constant negative population trend out of Illinois, I have experienced steady appreciation and rent stability in my Chicago suburban market.  

Congratulations on starting your journey.  We are all in this together, and always willing to help!

@Jay S. I own a 4 flat in the Chicago suburbs, but not quite that far from the city.  Your numbers look pretty good, but I would also agree with @Ibn Abney.  If the units are in great shape, and can be immediately re-rented, I would factor in a 6-8% (3-4 weeks/yr) vacancy.  If you are planning/needing to make any improvements to the units, it would be wise to factor in 11% (6 weeks/yr), at least initially.

I'd go $300-$400 higher on the insurance, and $1000 higher on trash.  If electric is only common areas (hallways, washer/dryer), you can come down $500.  Also, what about water and sewer?  I spend about $2000/yr pretty consistently.  I don't split up repairs and turnover replacements personally, but I'd suggest estimating these based on the age/condition of the units.  If all of the units are dated, assume a healthy number for regular repairs, and assume at least 1 major and 1 minor appliance to be replaced yearly for the whole building. You won't have to, but budgeting for it will keep you out of trouble when something does go bad (and it will).  

I hope this helps.  Good luck, and I hope you're successful with the deal.

@John Warren Thanks for setting this up.  Please count my wife and I in for 2.  Looking forward to it!

Thanks for the input, and I appreciate the perspectives.  This property is in non-habitable condition (no kitchen flooring or appliances, major water damaged drywall in multiple rooms, damaged bathrooms, plumbing issues, etc.) and unfortunately there are not any other distressed properties currently for sale in the immediate area to serve as a comparison.  There are also not any properties that have closed in the last 6 months that are similar distressed.

My thought was to therefore use the after rehab value of the market to estimate an offer price, since that data is much more prevalent.  The best comparison is the house next door -- very similar with a better layout and finished basement, and sold for $317,000 (and had clearly been flipped).  All other similarly spec'ed move-in ready homes in the area have sold for less.

Hi everyone,

Thank you for taking a look at this analysis.  I currently own a 4-unit that is successfully cash flowing, but this is my first stab at single family home investing.  This is a 4 Bedroom, 1 Full, 2 Half-Bath house located in the Chicagoland suburbs.  My plan would be to buy, renovate, live in x5 years, sell.  Rents in the area would command about $2200, which would not allow positive cashflow, so long term rental is not an option.

Home has been listed for sale since June 2018. Interestingly, they currently have two offers on the table. One cash-offer flipper who wants to close immediately (seller can't move that fast due to personal/family considerations), and one conventional offer which is more money, but FHA and likely won't get approved due to the non-livable condition of the home.

Current Asking Price: $280,000

After Rehab Value: $305,000

Estimated Repairs: $65,000-70,000

• $15,000 Kitchen
• $5,000 Full Bath
• $2,500 Half Bath
• $2,500 Half Bath
• $15,000 Windows
• $10,000-15,000 Central AC install + ducting
• $15,000 Paint, Drywall repair, Flooring repair, Misc

Following the recommended formulas -- ($305,000 * 70%) - $70,000 = $143,500 offer price.  Well, I offered $138,000 to possibly negotiate up to that final $143,500, but was told I'm way below the other two offers, and to not even bother.

Would you apply this calculation and purchase strategy differently?  If even the local flipper is offering more than I am, than I'm assuming I'm missing something.  I had expected to come in about what they would, using this formula. 

Wondering if you all would adjust your offer and take another shot, or move on.  Thank you for your help and insight.

For all of you who are married (or soon to be), how are you handling your finances with your spouse?  Keep totally separate accounts, merge everything, or make a stand-alone new joint account?  My original thought was to merge everything for convenience, but will I be shooting-myself-in-the-foot by having the banks see us as ONE entity, and therefore limit the total number of loans that I can obtain with conventional financing?

A previous podcast had emphasized that huge advantage of keeping properties under only one spouse, rather than both, which allows up to 5 loans per person (instead of 5 total jointly).  I'm unclear if that's a decision that can be controlled at the time of purchase, or is dictated by your financial account set-up with the bank.

How do you and your spouse handle your accounts, and how has it impacted your financing options? 

It's hard to "shop around" to find the right realtor fit without seeming deceitful or dishonest.  Every office will tell you their agents are great.  How have you all found your agents who are strong with Chicago multifamily investing?  Or did you skip that option altogether, and just work with wholesalers?

I'm ready to purchase the next one or two multifamily investments in suburban Chicago, and see this as an opportunity to start building those deal-finding relationships for the long term.  Any advice is welcome.  Thanks for being a great community.