How To Buy An Apartment Building in Chicago

Maybe you’ve reached the point in your real estate investing career where you’re ready to buy an apartment building. If done right, with careful planning and due diligence, it can be a lucrative investment move. You just need to be aware that buying an apartment building is a much more complex undertaking than investing in a single-family home or even buying a small multi-unit property. It requires more financing, greater cash reserves, and a deeper understanding of real estate investing’s financial and management aspects. So to give you a leg up, here’s how to buy an apartment building in Chicago.

Decide Whether It’s Right for Your

 

The first part of preparing to buy an apartment building in Chicago is deciding whether investing in an apartment building is right for you and your business model. And that means having a pretty firm grasp on the pros and cons.

PROS

 

    Recurring income from tenants in multiple units

    Less risk owing to the diversity of having the investment spread across many units

    Relatively low per-unit maintenance costs

    Financing based on the property’s income potential

    Potential to increase value by  increasing rents

    The potential for extra sources of income like vending machines and coin-operated laundry

 

CONS

 

    More intensive and time-consuming management duties than with single-family properties

    High tenant turnover and costly vacancies

    Lack of tenant concern about treating the unit properly (lack of care)

    Higher overall maintenance (both tasks and expense) than with single-family properties

Determine the Best Kind of Apartment Building for You

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