Hey y’all! So as of of today, I’ve officially been a landlord for an entire year & I truly cannot believe it. I thought the buying process taught me a lot but the actual ownership process has taught me so much more! In this post I’m highlighting 10 things I’ve learned in this year that has helped with managing an investment property in the Chicagoland area.
- Profit is KING!!! I’m fortunate enough to have it where two units pay for my rent and the other two be profit. In doing so, when things happen, the building pays for itself! When you are looking, make sure your rent(s) at minimum cover your mortgage and bonus you have some profit left over. It doesn’t matter how renovated your building is when you get it, it’s a lot of miscellaneous costs that comes with the territory.
- Treat the property as a business. I immediately opened up a business account for my property that allowed me to get all of my rents sent there and put all my expenses on autopay so I essentially don’t have to do anything. I don’t even look at the account honestly because I don’t look at the money like it’s mine. As I mentioned above, things happen and I’m fortunate enough to be in a situation where I don’t have to go into my personal account for anything and the building truly pays for itself.
- Build up your business credit! I made the mistake of opening up a lot of things in my name when I purchased the property. In doing so, my personal credit has been great but I need for my business credit to be just as great! I opened up my business account with who I banked with and was also able to open up a business credit card! With this, I was able to purchase a coin operated washer and dryer and I am building that credit. The goal is to buy another property under my LLC.
- If you purchase a property next door to a city owned vacant lot, secure the lot! You can go through the ANLAP program and get it at a really good rate! All you have to do is pay the property taxes and manage upkeep. On this lot, you can provide parking to tenants which is a great amenity especially on the more crowded Chicago blocks.
- Chicago winters are real. Every time you go out buy salt! If you don’t want to shovel pay someone to shovel! As a landlord it is your responsibility to make sure the property is shoveled and salt is down.
- I think this one is a little personal but wrought iron fences are hell! 0/10 recommend!
- If you have a family with small children, it may be more beneficial to put them on the first floor and not above another tenant, if possible!
- Keep a set of all keys at someone else’s house. You can’t call your landlord to let you in… you are the landlord!
- Identify the long term and short goals. I know we love instant gratification but the upkeep of a property can get pricy! If it is cosmetic things you want to change, those may fall under the long term goals but if it is something like a roof or plumbing, those are more short term goals.
- If possible, invest in a monthly or quarterly general upkeep services. I have pest control come out quarterly even if we don’t have any complaints because you never know. I also have a cleaning service come monthly to clean the hallways. My stairs are wood so that salt can do some damage to them in the winter!
I could go on and on but these are my top 10! If you are in the process of purchasing an investment property or wanting to purchase one, GO FOR IT! 1 year in the game and many more to go!
“Success in real estate starts when you believe you are worthy of it.” -Michael Ferrara