The Chicago rental market is booming right now. Demand for rentals has never been higher, Chicago area rents are on the way up, and the time to invest in Chicago properties has never been better. Find profitable rental property, and you will have an excellent investment that will be profitable for years to come. However, choosing your investment property can be tricky. Choose poorly and you could potentially lose money instead of earning!
Your first step, if you have not already taken it, is to consider the type of property you would prefer to invest in. You might choose a single family home, a condo, multifamily home, or even a larger apartment building. Before you start working with a broker, first decide what kind of property you’re willing to take on and what you can afford.
Consider who your ideal tenants would be. Also, consider whether you would be taking care of your rental property yourself, or if you would need the services of a Chicago property management company for your rental. Think about why you are buying this property and what you hope this investment will do for you. There are many books on this subject that can help you get started investing in real estate.
After you make that decision, you should narrow down the neighborhoods and areas you would like to consider for your rental property. Then, consult with a licensed professional Chicago broker to help you find the perfect profitable rental property.
Here are some tips to identify which property will provide you a good return on your investment:
- Consider the Neighborhood – the quality of the neighborhood will have a great impact on whether your rental property is a profitable rental property, or whether it will sit vacant. If you are not able to go to the neighborhood yourself, but aren’t working with a broker yet, do some research online and see what you find. Some neighborhoods that may appear bad at first glance can actually be great investments – as long as the area can be said to be improving. Properties in declining neighborhoods do not attract great tenants and could even be the target of vandalism. Look into crime statistics for the area.
- What Employers / Schools / Attractions are Nearby? – The answer to this question will tell you what your potential tenants will do for a living, and what their lifestyle will be like. If high paying employers are in the area, your rental property may fetch a higher rent. Likewise if there are desirable schools. If there are dining, shopping and recreational activities nearby, tenants will be drawn to the area.
- Environmental factors – if the property you’re considering is in an area known for flooding or other disasters, chances are you’ll be in over your head. If you’re spending all your money trying to recover from property damage, you have not found a profitable rental property.
- Consider the condition of the property – you may choose a property that is in need of some work. If you do so, you should prepare to experience a period of vacancy until the property is in rent ready condition. Keep in mind that different areas and different types of property will attract tenants with different definitions of what it means to be “rent ready.” Some properties that are generally in good shape may still need updates in order to become profitable rental property for the area.
- Look at property taxes in the area – if property taxes are increasing in the area, this can become a significant expense for you.
Remember, the best protection for your profitable rental property investment is quality property management services. Consider a professional Chicago property management company with a record of excellence in the industry and years of expertise. Contact Real Property Management Chicago Group to learn more!