So. In Chicago now and love the feel of the place and want to buy an investment property. Unlike SF / Seattle / Boston, things seem fairly within reach. Does anyone have any experience investing in the area when they’re not from here?
I would NOT buy in Chicago
More detail? Home price trends and rental trends in somewhere like the loop look pretty good.
Seems op does not know anything about investment.
Guilty as charged
Only buy in river north, Gold Coast, or Lincoln Park, or otherwise very upscale neighborhood. There’s a huge wealth divide in Chicago (like the rest of the US) and you don’t want to get caught on the wrong side of it in a downturn
Are you going to live near Chicago? One of my friends bought an apartment and got stuck with a remote tenant who didn’t pay and then a lawyer who scammed etc etc. The apartment is still underwater after 10 years!!
Have some folks I can reliably rent to for 3-4 yrs atleast but might mean I won’t keep up with market rents
buying real estate in a market you aren’t familiar with is a terrible idea. Midwest housing is 100% tied to interest rates (which are rising) since all cash buyers are super rare compared to in SF/NYC/LA. The higher the interest rate, the lower the mortgage Midwest folks can afford. Prices are not going to appreciate at the pace they did over the last 10 years.
Do you see all of the cranes? Means it’s too late. Lots of inventory. Declining population. Won’t cash flow.
I own 2 rentals MFHs in Chicago and live in the Bay area, I lived in Chicago before. CoC return is 33% and 20%. I net $4500 a month after PITI and expenses from rents. Top areas like River North, I used to live there, won't cashflow. Look at Albany Park, Irving Park or similar areas, those might still cashflow. Your tenants are gonna be more blue collars but demands are still strong. Look for MFHs, or fixer upper, only those cash flow. Don't bank on appreciation. It's a cashflow market.
Look up rents on Craiglist or Zillow and see if MFHs meet the 1% rule or not. Then it's worth looking further.
House price never increases in chicago and population is decreasing. Why would you want to invest there?
That is fascinating - I never even considered the idea that pops could decrease in major metropolitan areas, but this looks like it could use deeper analysis than just looking at absolute numbers: http://www.chicagomag.com/city-life/March-2018/Two-Graphs-Show-Why-the-Chicago-Area-Is-Losing-Population/
Yeah. Look into areas that have the potential for population booms. Austin for example or any other growing tech town.