advice on buying and owning rental properties in the Loop... (Chicago: foreclosure, renters)

[jsnoodle]

Hi,

Just wondering if anybody out there owns rental property in the Loop and can offer some unbiased advice on the current market situation. I'm looking to invest in 1-2 condos in the heart of the city and was wondering on how things are currently looking rent and tenant wise. I talked to a realtor the other day and not surprisingly she said things were booming.

At the moment I see a lot of properties going for 1500-2000 per month and some condos being sold for as little as 150k.

I'm partial to investing in the downtown area due to the number of jobs and concentration of people (i.e. potential renters).

Thanks!

[snoylekim]

By the Loop, I'll assume you mean the Loop proper ( not much residential) , plus Fulton -West Loop Gate, South Loop, and part of River North .. Yes, the renatl market is booming, with new construction that's rental plus newer rental buildings that provide close to a 'condo' atmosphere ( stainless steel, granite, maye some marble) for the appropriate rent.
You will not find much ( maybe some true studios) for 150K in these areas , unless it's a short or foreclosure.. Talking high 100s for studios, High 100s to low 200s for 1 Bedroom convertibles , and up from there ...
You will be competing with mostly available ( for the right price) decent rental stock
You will also need to carefully review any rental restrictions within the specific development bylaws; quite a few developments revised these because they did not want the % of renters climbing , as it started to after the bubble broke .. makes FM/mortgage and financing requirements harder to meet .. You'll also need to review rules for rentals with respect to association bylaws, etc , because , as the landlord, you're on the hook for any fines, etc .. There also might be prescribed clauses required for leases ( e.g. term of lease, paragraph stating any violation of Association rules constitiutes a breach, etc) .. and, I believe you are subject to the Chicago Landlord Tenant Ordinance ..

[marothisu]

The Loop itself...I personally wouldn't invest in that, but as snoylekim has pointed out, Fulton Market area, South Loop, and West Loop are booming, as is River North, Lakeshore East, and Streeterville and possibly some other areas west and north.