Monthly Archives: March 2016

10 Useful Websites for Chicago Property Research

 Property Searches – www.chicagoREinvestment.com– Use this website to search all types of residential properties.   Chicago Crime Map – http://gis.chicagopolice.org/– Use this website to search for crime incidents in your neighborhood or others.  This information is provided directly from the Chicago Police Department.  Keep in mind that all areas of Chicago will have some level of crime, so be sure to compare one area to an area you are more familiar with.  This will help you develop an opinion as to …
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Reasons to Buy a Two Flat

 You want to earn passive income. You rent both units out and earn a cash flow.  Sounds easy, but there is more to it and most of the heavy lifting is done before someone moves in and pays you rent.  First, you must select a good property that will cash flow at market rents and in the future.  Then, you must market your property for rent effectively so as to attract the best tenants capable of taking care of your …
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What to Consider Before Buying a Two Flat

Before you buy a two flat, you should consider some of the various factors that will make it a stable long-term cash flowing property.  I have highlighted some of the more important ones for you below: Property Taxes – Your two biggest expenses every year will be property taxes and interest expense.  If you pay cash, then yes, you will not have to pay interest expense.  Property taxes will vary greatly depending on the area you purchase in.  So what …
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Live For Free in a Two Flat

In Chicago, a large amount of lots in the city are filled with multi-unit buildings including two-unit buildings called two-flats.  The standard two flat is made of a wood-frame, brick or greystone and will be two stories high with a basement and a 25 foot wide x 125 foot deep lot. These two flats in Chicago have been used for decades as a way for families to have friends or relatives live in the same building while providing separate places …
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Things to Consider When Purchasing a Two-Flat

In this post, I want to share with you the most important things to look for when buying your first Two-Flat. Whether you’re a first-time homebuyer, or you have owned condos or single family homes in the past, it’s important to know these key factors that will affect the value of your two-flat.  Since I’m a numbers guy, let’s start there! THE NUMBERS: In my opinion, cash flow is the most important financial measure of the building you intend to …
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Reasons to Buy a Two Flat

Two flats are residential buildings with two dwelling units both used for the purpose of a home for the occupants. These buildings are very common in Chicago and are purchased for many reasons. As someone who has lived in, owned, managed and sold two flats for more than five years, I have a good handle on what makes them special and desirable. If you are like me, and you like stretching your dollars, then two flats may be a great …
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Use a Self-Directed IRA to Purchase Real Estate Investments

Self-directed IRAs can be a mystery to most but a retirement goldmine to a select few. Are you a real estate investor, do-it-yourselfer, independent mind, control freak or entrepreneur? If so, you should definitely consider taking advantage of a self-directed IRA to purchase real estate. What is a Self-Directed IRA? A self-directed IRA is an individual retirement account held by a trustee or custodian that permits investments in a broader set of assets typically permitted by most IRA custodians. Custodians …
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How to Effectively Project Manage

Budget: Expected cost is one of the first things you should identify when evaluating a project.  Regardless of how many zero’s a project has in its budget, you should set a benchmark to help you determine the appropriate scope of work for a project. By setting a benchmark budget early on, scope and timeline can be finalized to meet budget.   If your project is a DIY – walk the isles of your local hardware or big box store to look …
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FHA Self-Sufficiency Test 3-4 Units Chicago

FHA loans can be great for first time home buyers and owner-occupied two unit buildings but what about three and four unit buildings?  FHA Loans are a good option on three and A Large Four Unit Building in Chicago four unit buildings but they must pass the self-sufficiency test. The self sufficiency test states that the maximum mortgage is limited so that the ratio of the monthly mortgage payment, divided by the monthly net rental income, does not exceed 100 percent.  In …
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Buying 2-4 Unit Properties Using an FHA Loan

Some of you may already know, but the FHA (Federal Housing Administration) allows home buyers to purchase multi-family property using a mortgage for as little as 3.5% of the purchase price. Recently, the FHA reduced the loan limits in Illinois which will affect the purchasing power of future buyers who plan to use an FHA insured loan for their first or next purchase. Here are the new loan limits for Cook County Chicago, Illinois: Two Units:  $468,150 Maximum Loan Amount …
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