All Forum Posts by: Michael Taylor

I am finishing up doing a rehab on a 6 unit building on the southside of Chicago, now I am ready for my next building (again looking for 6 to 12 units).  To my surprise, prices have gone up on properties (I thought they would have gone down or stayed the same because of Covid-19 and the recession).  My wife tells me that I should wait and not buy anything because Chicago has too many tenant friendly laws and that people are not paying rent.  She has a friend that purchased a building, and none of the tenants in that building are paying rent because they know that they cannot be evicted.  The mayor and governor keep pushing back evictions, so people are taking advantage of it and not paying rent.

I understand her concern, but even if I were to purchase a building today it would be 60 days before I close.  I am hoping that by the fall Chicago will at least open the courts and begin evicting people.  Also, I am concerned that prices will continue to go up not down.  Should I buy now or wait until after Covid-19 is over (whenever that is)?

@ Mike B, I have the permits for the work I have done so far and have had the city inspectors out twice already.  To finish the basement will take plans and approval, but the mayor wants to streamline that process to make it easier to add garden apartments. @ Jaysen, Eddie, and John, the $30k is not all I have, but I don't want to touch the rest of my money which is in retirement funds.  I do have access to enough hard money if I wanted to add the garden unit, but it ain't cheap!  Eddie, I will take you up on the offer to met other lenders.   I already had US Waterproofing come to give me an estimate for the basement also.  Thanks everyone for your input.  

I purchased a 6 unit apartment building on the south side of Chicago In January 2020 that I had to rehab, it is on a one year loan with an investor. Not only did I have bad tenants that I had to evict, but then came Covid-19 which stopped that eviction process. As of today I have one last person to get out of the building which has delayed my rehab schedule (I have until the end of the year to refinance this building). As of today, I have rehabbed 5 of the 6 units (which are all rented out at $1200 a month) and I have to build a laundry in the basement and take care of some minor plumbing work and porch reinforcement (this will all be completed by July 31, not sure when the last tenant will be evicted). The challenge is that after my rehab is complete, I will have about $30,000 left over. I can either keep that money as I will need reserve funds to refinance, or use that money to add a garden 2 bedroom garden apartment. By making the building a 7 unit instead of a 6 unit, I can refinance for more as I need to pull my investment money out. So, for the experts on the forum, should I invest the money and add a garden apartment or hold onto the money making my financial positions stronger for the refinance?

Michael, thanks for your reply.  The planet did actually go through this before in the modern era, the 1918 Spanish Flu Pandemic that spread around the world.  My guess is that there is not enough available information from that period to know, but I wonder how did we recover from that?  About 675,000 Americans died from that pandemic that lasted over a year.  I don't know how it affected the markets, but after that came the roaring 20's.  Just wondering what specific recovery measures were in place after that for the real estate market?  Thanks again.

I just acquired a 6-unit building December 31, 2019 on the south side of Chicago, the plan is to rehab and refinance so I have a one year short term loan. I ran into some tenant issues with squatters that has slowed down the rehab process, so far I have only completed two units and the roof. Last week finally the police removed the squatters. Now that I have finally gotten the tenants out and I am ready to finish up the process, yet now comes the Corona Virus. So the question is, will the loan company grant me a forbearance during this corona virus national emergency? The building is not generating any income as I have no tenants. With this virus emergency, even when I finish the rehab, I have no clue as to when I can market the units as available rentals. I have written the investment firm and I am waiting for a response. Is anyone else facing this? Is your bank working with you? Will investment firms grant forbearance on rehab loans as the state is mandating a stop on paying rent, mortgages, and foreclosures?