The investor must consider whether the potential property value increase or other benefits outweigh this loss. 

The fix-up and increased value will not matter to the IRS as long as you sell within a reasonable time frame of the house passing into the estate.

Materials have increased more than 20% in the last 5-8 years.

If Oak Park allows STRs, leveraging that history could make the property stand out.That said, unless the home has been preserved as a landmark or has unique historical features, the value boost may be more about novelty than a significant price increase.

I like the cash flow and see the potential for increasing rents, but I’m hesitant about overpaying.

Chicago is a lower appreciation market but with the trends we've been seeing with increased rates of hurricanes on the east coast and fires in the west, I do think long-term we will see some migration to the Midwest.

It was a 50% of one months rent and a $100 increase in rent. 

If you have a high level of faith in the company you are working with, then time will do what it is supposed to do and increase your IRR.  

In 2022 the rents increased 12.1% year over year which was the 3rd highest in the entire country per https://www.axios.com/local/cleveland/2023/02/14/cleveland-rent-prices.

But once I got the bills, I increased the rent with the tenant's approval and signed an addendum to the lease stating the rent increase would be X and the owner would take over utilities.