Chicago is a fantastic city with much to offer in terms of industrial development and cultural value. Because it’s a port city serving the Great Lakes and the Mississippi River, it’s been an important industrial hub for a long time. That also helps it retain its strong economy. Chicago offers its residents a wonderful cultural experience and a variety of housing options. There are many reasons to buy property in Chicago. For one, it’s an ideal place for investment. With so many people migrating to Chicago over the past couple of years, home values have appreciated greatly. Even with that, an investor can still find pretty reasonable real estate prices. Let’s explore why real estate investment in Chicago is such a good idea.
There is a high demand for rental properties, so income is steady
This city is a hotspot for rental property investment. More than half of Chicago homes are rented. These benefits don’t stop at the borders of the city itself. Even some of the surrounding cities in the Chicagoland area offer fantastic investment opportunities. Chicago brings investors a much higher ROI than the rest of the country. If you’re familiar with cash flow investments, this is the area for you. That is because Chicago delivers much higher margins in terms of cash flow.
While there are single-family homes for rent, you would likely be better off investing in an apartment (or a few). It’s common for investors to think in terms of square footage. However, even though apartments are smaller, they are much more desired here. And, if your investment property ends up being on the smaller side, US Moving Experts Chicago experts recommend looking into how landlords can benefit from renting out self-storage units.
The real estate prices in Chicago are usually very reasonable
It’s understandable why people assume that property prices in such a populous and desired city would be extremely high. However, this is not the case. Because so many citizens prefer renting a home here, the demand for properties for sale is pretty low. Of course, when there’s less demand, prices reflect that. Real estate property prices rise slowly and have remained relatively low for a while. That is the dream for people who want to make a rental real estate investment in Chicago. You can buy a property for very little and rent it for a reasonably high price. One thing to note is that buying properties from homeowners (as opposed to previous landlords) might require an extra skill. That is because it’s common for particular residents to overprice their homes. Although they are usually easily swayed by negotiations and (if possible) cash offers.
The solid job market ensures a lack of vacancy periods
Chicago has one of the largest labor pools in the United States, and predictions are that it will keep growing over the following years. That is mainly attributed to the recent trend of corporations and companies relocating their headquarters to the metro area on a large scale. This is important for real estate investors because the increasingly demanding job market brings a wave of new residents. That is good news for rental investors and investors who lean on property value appreciation. Especially since landlords seldom experience vacancy periods. If a tenant leaves, there will likely be a line of people clamoring to live in your rental.
It’s a strong investment
Investing in a property in The Windy City is one of the most thoughtful choices an investor can make. Because of industrial development and resident influx, the market has remained steady for years. Additionally, since most investments in Chicago will be based on renting, you’re much more likely to survive any recession that may happen in the future. While home values can depreciate, rent prices generally stay the same.
Of course, if becoming a landlord doesn’t seem appealing to you, there are ways around this. Firstly, just because most properties in Chicago are rentals doesn’t mean you can’t profit from selling. As previously mentioned, real estate in Chicago tends to appreciate. It’s just more of a “slow and steady” process. Since renting out a property in Chicago is so profitable, hiring a professional management company shouldn’t be much of an issue for your pocket.
The best neighborhoods for a real estate investment in Chicago
Because there are nearly 98 neighborhoods in Chicago and its suburbs, finding the right area for the investment property you want can be challenging. Although the exact number is disputable, the consensus is that many of them exist. But, if you want to make the right investment choice, you’ll have to get to know (at least) some of them. To get you started, we’ve compiled a list of seven of the most popular investment neighborhoods.
- Logan Square – This neighborhood is west of the I-90, and most of its residents rent their homes;
- West Town – West Town has been rising in popularity with families. That is mainly due to its unique mixed urban-suburban style;
- Lincoln Park – This area is a common choice for both young singles and families with young parents because of its mix of lavish nightlife and a reputation for safety;
- Uptown – If you’re planning to rent your property to businessmen/women, Uptown is the investment neighborhood for you. It’s a dense urban area popular with the corporate working class;
- Lake View – Lake View has consistently been named one of the best neighborhoods in Chicago. It’s extremely popular with young people because of its dense urban feel, great nightlife, unique bars, coffee shops, and restaurants.
Pro tip – Remember to be proactive
Moving to Chicago is a beautiful and exciting opportunity for many people. That is why many people flock to this gorgeous city without proper plans. They hire long-distance movers and rely on expert help to bring them here, move into a short-term rental and get stumped. If you remain on the lookout, update your online listings, work with a highly motivated agent, etc., you might find one of these people before they even need to find you.
Concluding
The benefits that come with real estate investment in Chicago are endless. However, we hope we have at least inspired you to look further into them with the ones we’ve listed above. It’s a promising area that has been on the rise for a long time. Vacancy should be nonexistent, ROIs are almost always excellent, and property prices are usually reasonable. As long as you take your time, consider essential factors (ex., the neighborhood), and make sure you’re buying the right property (watch out for overpricing, red flags that show faults, etc.), you should be well on your way to profiting. Chicago is simply one of the most affordable and yet most profitable investment cities in the country.
About Gerardo Zavala, Realtor
There is a true passion for connecting people with real estate that makes me fall in love with my career over and over again. While my title says, REALTOR® I think I am much more than that. For example, I am present and actively listening to my client’s needs, on the spot when things are urgent, and by your side to say “congratulations.” Most of my clients will say that I am a connection away from support no matter the situation, day, or time. In my opinion, customer service, educating the client on progress and next steps, and overall satisfaction are my top priorities. How can I help you?
