All Forum Posts by: Mark Ainley

We rent to mostly CHA tenants(section 8) in Chicago and love the "non refundable move in fee" which we have a totally separate lease from the ones we collect deposits on. We offer the tenants a choice and they always go with the $500 fee vs. the one months rent which our average rental rate is $1,080.00. With CHA tenants they do have the incentive to not destroy the place due to ramifications from CHA but we like the ability to use the move in fees as capital to work with which adds up. I have offered our lease up before to anyone that wants a copy to modify for their own so please always fee free to let me know.

The security deposits collected do need to be held in a "Iolta account" which is different then a plain checking account so keep that in mind when collecting deposits.

So to answer your question we do both to minimize our risk.

Questions to ask off the top of my head:

-At the end of the month what is their uncollected rent percentage or open rents not collected?

-How many evictions have they had to do in last 2 years for single family tenants?

-What is the ratio of workers to units under management?

-Always ask what they charge extras on. Some companies charge extra for 5 days delivered, notices mailed, emergency's, court time, handling insurance claims, maintenance..etc.

-Get references and call them.

-How strict are they with charging late fees.

-Are they currently involved in any lawsuits?

-Get a copy of their insurance certificate.

Pretty sure that Austin & Englewood both that have some of the roughest patches but we have two SFHs on a quiet block in Englewood across from a school that we have little issues with. Like Clifford said above...it is block by block.

The city of Chicago has many options...and great cap rates in many parts but most likely areas you don't want to be an owner occupant. I say that based on you will most likely look up the crime rates and decide for yourself. There are many great investment opportunities in Bollingbrook, Crest Hill, Joliet, Shorewood, Plainfield, & Romeoville where you can still get over 10% returns at this point but prices in these areas like the rest of Chicago have gone up in last 3 months mostly due to lack of inventory and so many more investors pulling the trigger this year.

I don't know much more about them other than they are active, they buy a lot of HUD homes and REOs, and never heard anything negative or positive.

LOL....Chase is the guys last name. These guys buy a lot on HUD and work a lot more in west burbs.

Title Co - the best priced title company in Chicago seems to be Barrister Title. If you need a direct refferal please let me know and I can give an intro. No one has ever been better priced then them for us or clients.

Also keep in mind what Lincoln Park and Wrigleyville were like in the 70s and early eighties. For those of you who are old enough it was nothing like it is today and can be safe to say no safer than Bronzeville or East Woodlawn is today?

There is no where else in the city where you can buy a property in be all in for $40,000-$50,000 per unit after repairs than on the south side and those same units will double in value in short time. Prices may be as low as they were in the 80s or 90s but they have had peaks and valleys multiple times since. Let's not forget current rents compared to 1980s which were 70% lower. Vacancy on the south side can be controlled by sticking to a CHA business model. In 5 years and many units we have yet to have a single CHA tenant move out after just one year and many we have the original tenants still. Any issue we have with tenants on the south side is market tenants. Market tenants are quick to not pay and quick to call the city on you so we do attempt to lease to CHA when possible.

There's better areas than others on the south side. There are areas we stay away from but there are also little better areas where you might be at $65,000-$70,000 per unit and be a little more south side conservative(lol).

South side appreciation is there every 10 years fueled by speculation and investors flipping and most recently (2004-2005)building new so there is appreciation, it just has to be timed right.

Heck you guys all see what these turn key companies are selling these two flats for in those exact neighborhoods we won't touch anymore and they are appraising out. In just 5 years that happened and those new levels were reached.

It backs to rt 59 and is very loud and I heard there is issues with the stucco and moisture that has got behind the walls. The previous owner reached out to our firm to sell a couple years back. Area and neighborhood are great but always rumors the area wells have had contamination in past years. Nothing ever verified that I know of but sometimes rumors are just as bad.