property management, real estate

How to Stand Out in Property Management

By | Agents, Brokers, Property Management, Real Estate Investment

When landlords decide it’s time to work with a property management company, there is a lot more involved than just relationship building. Below are a few highlights related to how a management company can be appointed.

property management, real estate

Groundwork

To be chosen to manage rental units, you first need to make sure you’ve laid the groundwork as a successful company. It is imperative that you are properly licensed, create an LLC  or S Corp, and follow a business plan if created. Having a framework will allow your clients to feel confident in your skills and capabilities.

Setting up a company and displaying a healthy rental portfolio will show potential landlords that you know what you’re doing. To be successful and appointed, you need to have the foundation in place.

Building Relationships

In any client facing role, building relationships is the key to growth. Valuing employee relationships can build a solid business, but so can relationships with property owners in your community. Set expectations and keep the lines of communication open for new prospects and current owners.

Feel confident providing your own proactive feedback to owners and identify opportunities for additional revenue streams. Property owners are looking for firms to explain exactly what can be provided for them.

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A Healthy Portfolio

Property owners are looking for management companies with healthy pipelines and positive reviews. It is important to model high levels of customer service and management skills. If there is high tenant turnover or flags with occupancy or vacancy rates, this can impact your reputation as a company and deter new prospects. Keep up with shifts and remain accommodating.

Your Next Move

When it comes time to being chosen, be prepared for questions. Most owners want to know how the property will be managed, the fees involved, and how to cancel if needed. Whether the management company has failed to deliver on promises, or you simply want to manage the home yourself, you should let the company know your reason for leaving.

You want a company that is not only knowledgeable about their own processes and systems, but also about the changing real estate market and local laws that affect your property.

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Agents, Brokers, Property Managemnt, Real Estate Investment

Are Condos a Wise Investment?

By | Agents, Brokers, Property Management, Real Estate Investment

For the first time home buyer or real estate investor, a condominium seems like a great investment, but will it provide for you in the long run? In this article, we share how condos differ from single-family homes and which type of property best fits your investment needs.

Condo vs. Single Family

A condo is an attractive housing complex for most new buyers. With each unit owned by an individual with privileges to use common areas within the building, it provides a next step to turn renters to buyers. However, condo owners are responsible for maintenance and repairs within their own unit. Owners are also required to pay regular fees to a condo association that provide maintenance of the shared common areas, building amenities and the exterior of the building.

There are a few perks to investing in a condominium. Compared to a single-family home, condos are attractive because they are typically less expensive. Condos also appreciate in value over time. Since external maintenance and upkeep is mostly taken care of for you, this releases an amount of stress off the unit owner. Most buildings also offer amenities such as pools, fitness centers, common areas which provide a social aspect for individuals interested in communal style living.

Agents, Brokers, Property Managemnt, Real Estate Investment

Looking for an ROI

If you’re in a position where you want to investigate investment properties, a condo may be something to add to your list of considerations. While renting can be an affordable option for those who aren’t ready to invest in real estate, buying a condo can be a rewarding move that sets you up for future financial success. How? Condominiums allow you to build equity in the property that you wouldn’t with renting.

While this might sound like the right move, you should also consider the drawbacks.

Agents, Brokers, Property Managemnt, Real Estate Investment

The Association

The Homeowners Association is a subdivision that makes and enforces rules for the property and residents. The contrast with having an association is some can be very restrictive about what members can do with their properties.

Depending on the location you are considering, condo association fees can be hefty. These fees can increase your monthly payment, which would cut into your overall return on investment. In addition to rental restrictions, there might be other restrictions in a condo community related to parking, common areas, pets, etc.

The association might also limit the types of modifications you can make to the unit. Not every condo community allows you to rent out the condo or limit this capability so short-term rentals like Airbnb are not allowed.

Takeaway

If you want to start investing in condos, make sure the location you select is likely to provide a good return. Consider how you will obtain financing and how much time and money you want to spend on maintenance and repairs. If you can keep up with the fees and the restrictions don’t prevent you from renting the unit, investing in a condo can be a senseful move for the first time buyer or property investor.

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rentals, property, real estate

How to Build a Rental Portfolio

By | Agents, Brokers, Property Management, Real Estate Investment

If you are interested in passive income, you may want to consider building a rental portfolio. Building a portfolio can include more than just rental properties. It can also incorporate flipped homes and Real Estate Investment Trusts (REITs).

rentals, property, real estate

Start Small

When getting started on your portfolio journey, don’t be too ambitious. Be sure to learn how to increase the property’s value and how to manage tenants. Start by getting clear on your investment goals and strategy plan. Think of it as a business plan, which will help you get clear on specific, shorter-term goals. This increases your chances of becoming closer to achieving your objectives and defining the strategies you intend to use to achieve those goals.

Pull the Tigger

Once you’ve created your business plan for building your real estate portfolio, now it’s time to buy your first investment property. Be sure to work with an experienced real estate broker and lender. Once you have a property in mind that you believe provides a great investment opportunity, perform an investment property analysis to make sure it makes sense financially.

Grow Over Time

In time, it’s important to grow your portfolio, which means buying properties and adding them to the set. Keep in mind that when you’re juggling multiple rental properties or multiple properties in the process of being renovated, it can be hard to keep everything organized. You may want to consider a property manager to assist you in this process.

Measure Your Success

The easiest way to measure the success of a real estate portfolio is to hire a portfolio manager . Most professionals will conduct an initial investment audit and make recommendations on how to strengthen your portfolio based on the results.

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How to Start Your Home Search

By | Agents, Brokers, Property Management, Real Estate Investment

The time has come when you decide to take the plunge to purchase your first property. It can be an intimidating process if you do not know where to start or too overwhelming that you push it off until later. We’re here to help you take those steps forward by sharing 5 tips on where to begin when starting your purchasing journey.

Check your Finances

The most important step before you begin looking at properties is to check your finances. It is important to know where you stand when it comes to your debt-to-income ratio. You can also use one of the easiest ways to calculate a homebuying budget using is the 28% rule, which dictates that your mortgage shouldn’t be more than 28% of your gross income each month. Remember, homeownership involves a variety of continuing costs, including insurance, property taxes, and repair/upkeep expenses.

Learn the Mortgage Process

The best way to learn the mortgage process is to find a step-by-step guide that explains it in greater detail. Most mortgage brokers will look into your income & job history, credit score, debt-to-income ratio, assets, and the property type you are interested in.

Get Pre-Approved Before You Start Your Search

The first step in this process to get pre-approved is to start by filling out a mortgage application and supplying your Social Security number so that the lender can do a credit check. Going through the pre-approval process with multiple lenders allows a homebuyer to shop mortgage rates and find the best deal. You can also count on a seller wanting to see a mortgage pre-approval letter and, in some cases, proof of funds to show that you, the buyer, are serious.

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Research the Neighborhood You Want to Live In

Once you receive your pre-approval letter, it’s time to find the neighborhood you want to purchase in. You can work with a broker directly to see what area you are interested in. It is important to find a broker who you can trust and who will achieve your wants and needs in a property.

Know the Difference Between Your ‘Must-Haves’ and ‘Would-Like-To-Haves’

Finally, it is important to consider what you need in a property and what you would like in a property. Before you start your search, list all the features of a home you would like and then qualify them as ‘must-haves’, ‘should-haves’, or ‘absolute-wish list’ items. This will help keep you focused on what’s most important.

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How to Buy Property Before 30

By | Agents, Brokers, Property Management, Real Estate Investment

There are pros and cons to purchasing property before turning 30. It also isn’t as hard as most people think! Once the minimum requirements are met, lenders hold the same standards for income, savings, and credit whether you’re in your 20s or 70s.

The benefits of purchasing a home early are related to taxes and investment perks. Most homeowners receive tax deductions, mortgage interest deductions, point deductions, and state & local tax deductions. However, there are also a few cons to owning a home, such as changes in interest rates, maintenance and upkeep costs, and market fluctuations when looking to sell. However, when the time comes to make the decision to purchase, consider a few factors before buying.

Credit score

Your credit score informs lenders about your personal finances. You won’t need spotless credit to qualify for a mortgage, but here are a few highlights to consider when lenders investigate credit –

  • 580 for FHA loans with 3.5% down
  • 580 to 620 for VA loans
  • 620 for conventional loans
  • 640 for USDA loans

Remember, when you check your credit score the scores you see in free credit monitoring apps tend to be higher than the FICO scores used by lenders.

Debt–to–income ratio (DTI)

Your existing debt affects your mortgage eligibility, and this ratio compares your monthly debt to your gross monthly income. To measure your DTI, add up your loan payments along with your minimum credit card payments, then divide by your gross monthly income. Multiply that number by 100 to see your DTI.

Down payment

To receive a home loan you will most likely need to have a down payment. For example, a 3% down payment on a $300,000 loan equals $9,000; to put 10% down you’d need $30,000.

If you have enough cash to exceed the minimum down payment requirement for your loan, you’re more likely to qualify for a lower mortgage rate which saves on long–term interest. It is important to consider all these factors before moving forward with a home purchase. Be sure to consider all the financial and other lifestyle implications.

If you are not in this position yet, not to worry! Now you know how to prepare when the time does comes to buy your first home.

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Why Professionalism Matters in Real Estate

By | Agents, Brokers, Property Management, Real Estate Investment

Professionalism goes along way in any industry, but it goes further in Real Estate. Why? Simply put, trust. You need to be able to fully trust that your agent is abiding by the code of ethics while also prioritizing your needs. A professional agent is one that is knowledgeable, communicative, and reliable.

They Know Their Stuff

A great real estate broker is well-rounded in the industry. They provide all listing facts, are up front about any problems that arise, as well as share their knowledge of the market – competitive market analysis . It is important to recognize if an agent is not displaying these qualities early on, so you do not pay for it later in the transaction.

Communication is Key

Finding a broker who can be transparent and communicate is crucial to a successful partnership. Courtesy goes a long way as well. If you are running late to an appointment or encounter issues in the transaction, it is your duty to communicate this directly. Communication builds trust which is needed to continue forward in the transaction.

Be Reliable 

If you are unreliable, you will not be successful in this industry. It takes only a few moments for first impressions to occur, so if you already show traits that you are not dependable, you will not win the listing.

Trust is essential for working as any type of agent and it goes beyond customer satisfaction. A code of conduct ensures that clients trust you and by following these tips, you too can be a reliable & successful real estate broker in the industry.

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Agents, Brokers, Property Managemnt, Real Estate Investment

How to Market Real Estate to Millennials

By | Agents, Brokers, Property Management, Real Estate Investment

The millennial generation can be one of the toughest to sell products to let alone real estate. In 2021, millennials made up about 37% of the homebuying market. So how do you connect with a generation that is reshaping the housing market? Strive to understand them.

Agents, Brokers, Property Managemnt, Real Estate Investment

Social Media

The best way to grab the attention of the millennial and younger generations is to get on board with social media. This tool is by far the most beneficial to have in your pocket when engaging with current clients and reaching for new ones. Creating short-form videos on platforms such as Tik Tok, Snapchat, Instagram, etc. will help drive interested buyers and renters in your direction.

Enhance Web Presence

If you already know that millennials are constantly browsing the internet and social platforms, then this means you need to also create a web presence. It is crucial to incorporate social media into your website and create a presence that represents you or your brokerage . Most individuals contact multiple agents to see who is the best fit and the first place they’ll check is social. At the end of the day, millennials want to know how you stand out among the rest.

Price Matters

It is no surprise that most millennial home buyers can’t provide all-cash offers for their home purchases. Many are first-time buyers without funds from a previous home or have large sums of debt from student loans.

When you look at how millennials fund their down payment, it’s clear that their financial options are limited compared to other generations.

Agents, Brokers, Property Managemnt, Real Estate Investment

To help in these situations, share expertise on how to save money during the home-buying journey. Simple things, like contract negotiations or mortgage lender references can go a long way with any buyer.

In summary, if you do decide to target Millennials, you may have to learn some new tricks. Their love of technology means this demographic has different ways for choosing real estate agents.

You may need to accept the fact that calling, or emailing will be the last thing they do in their search for an agent. That contact will only come after they’ve thoroughly checked out your website, social media accounts, and online reviews. If you’ve always relied on having a charming phone presence to seal the deal, you’re already too late to this game.

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Chicago Real Estate Hit in a New Way

By | Agents, Brokers, Property Management, Real Estate Investment

After recent reports of scammers infiltrating the real estate market, Chicago has been hit in a completely new way. Fraudsters have been reported to break into empty apartments or homes, replace the locks, advertise the property for rent — even though they don’t own it.

Housing experts  say the scams picked up speed after the pandemic shutdowns. Vacant properties weren’t being closely watched and left vulnerable to intruders.

In these circumstances, fraudsters break into empty apartments or homes, replace the locks and advertise the property online. Prospective tenants sign a lease, pay a security deposit, and pay monthly rent to the supposed landlord. When that happens, the scammer flees, and the tenant faces eviction from the real owners.

With these new circumstances, it is now more than ever, important to Safely secure your property.  Another great way to keep a property secure is to hire a property management group to keep a watchful eye.

If you’ve never worked with a property management company, you may be surprised at how much they can help with tenancy turnovers, as well as other aspects of being a landlord.

Property managers are able to contract out the necessary work, market the property for new tenants, oversee and manage the property itself and any work occurring at the property, and communicate with departing tenants to get everything is taken care of.

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Agents, Brokers, Property Managemnt, Real Estate Investment

Safely Secure Your Rental Property

By | Agents, Brokers, Property Management, Real Estate Investment

Feeling safe and secure in a rental property is the number one priority for new tenants. Creating a safe environment for your renters will also establish trust for you as the landlord or property manager. Below are a few tips for creating a a safe and secure property.

Agents, Brokers, Property Managemnt, Real Estate Investment

Secure Entry Ways

As a landlord or property owner, the first step is to cover the basics. Make sure all windows and entrances are secured with locks or dead bolts. If installed, use patio and screen doors as well. Be sure to scope the property for any weak spots or problem areas that an intruder could take advantage.

Upgrade Security Features

There are several avenues to explore when it comes to installing security devices. Security cameras come with responsibility as well as privacy laws. It’s important to do your research before purchasing surveillance.

If the jump to purchasing security cameras is too much at first, you can also increase visibility with motion censored or exterior lighting. Displaying safety decals can also increase the security of your property and its surroundings. If in a larger multi-unit complex, attach emergency numbers as well.

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Look Into Insurance

Investing in home insurance policies is a common practice for most rental properties or tenants. It’s one of the best ways to ensure that if something happens to the property itself or the tenant’s belongings you’re still protected. Try to find policy options that combine both home and contents.

Hire a Property Manager

Another great way to keep a property secure is to hire security or a property management group to keep a watchful eye. It can be said that perhaps even more important than the property itself is its management.

If you’ve never worked with a property management company, you may be surprised at how much they can help with tenancy turnovers, as well as other aspects of being a landlord.

Property managers are able to contract out the necessary work, market the property for new tenants, oversee and manage the property itself and any work occurring at the property, and communicate with departing tenants to get everything is taken care of.

Rental property investments can be intimidating for the starting investor, but knowing which factors make a great property investment and where to look for them can help you start your journey to passive rental income.

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5 Factors That Make A Great Rental Property

By | Agents, Brokers, Property Management, Real Estate Investment

Follow the Market

In most cases, the first factor to consider when investing in a good rental property is location. This may be true, but it’s a better idea to check in with where the market stands. From the perspective of a Chicagoan looking to buy during 2020, 2021, and post Covid-19, the market has been dramatically shifting. It is important to consider housing market trends, as well as stay up to date on news relating to economic impacts that tend to shift the market.

Location

What separates a good rental property from a great one is location. It’s important to consider location when seeking out a rental property because of profitability. Put yourself in your tenants’ shoes, you should want to live where you’re investing too. This helps when considering factors such as building amenities, green space, scenic views, closeness to farmers markets, transportation, tax-exempt areas, etc. These all play a role in commercial property evaluations as well.

How do you choose a good location? Consider the mid-to-long term approach. Seek out growing neighborhoods or plots that have this potential. It is important to thoroughly review the intended usage and ownership of the areas where you plan to invest as well.

Property Condition & Value

Once a neighborhood or location is chosen, now it’s time to evaluate the estate and its condition. The condition of the building can affect the listing price, financing, investment analysis, as well as taxes and insurance cost. Lofty agents assist with this process by providing a competitive market analysis.

how to be a better real estate agent

Cash Flow & Growth Potential

There are a few ways to determine if property is returning a good investment or positive cash flow. If you are familiar with finance, you may have heard of the 2% rule. This rule states that if the monthly rent for a property is at least 2% of the purchase price, it will likely produce a positive cash flow. The equation is as follows: monthly rent / purchase price = X. If X is less than 0.02 then the property is not going to be as profitable of an investment. Typically, a good ROI for a rental property is usually above 10%, but 5-10% is also an acceptable range.

It is always important to crunch the numbers when considering investing in property.

Consider Property Management

It can be said that perhaps even more important than the property itself is its management. If you’ve never worked with a property management company, you may be surprised at how much they can help with tenancy turnovers, as well as other aspects of being a landlord.

Property managers are able to contract out the necessary work, market the property for new tenants, oversee and manage any work occurring at the property, and communicate with departing tenants to get everything squared away for you. You can hand off all those pesky jobs to someone else and reap the benefits of owning investment properties through true passive income.

Rental property investments can be intimidating for the beginning investor but knowing which factors make a great property investment and where to look for them can help you start your journey to passive rental income.

Chicago Property Manager

Here at Lofty, we believe that owning investment properties shouldn’t be a headache. We take care of everything our owners need, from screening tenants to doing the physical work between occupancies. Stop wasting time checking whether lights are working and sweeping baseboards and start enjoying being a landlord and property owner!

Wondering if a switch might be right for you? Give us a shout and learn more.

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Guide to Preparing a Chicago Rental Property for a New Tenant

By | Agents, brokers, Property Managemnt, Real Estate Investment

What should be done to a Chicago Property prior to New Tenant Move Ins.

Tenant turnover procedures and responsibilities can take up a lot of time, but another reason you may feel like you’re running around all over the place can be chalked up to doing tasks that are unnecessary. In order to ensure you’re making the most of your time, you need to be aware of what’s truly required of you as a landlord or property owner when one tenant moves out. Finding out what your responsibilities are between tenant occupancies can not only save you a lot of time, but it can save you some money, too.

How to stage your kitchen to sell faster with Lofty Real Estate

Set Realistic Expectations

While in a perfect world all of your tenants would patch holes in walls, scrub the floors until they sparkle, and do everything else necessary to bring the apartment back to life, that will almost never be the case. Tenants can generally be expected to clean the apartment before they move out, but they’ll be busy focusing on getting their moving plans and their new apartment in order, not making sure that their old place is in perfect condition and prepped for new tenants. Keep in mind that the responsibility for making the apartment ready for your next tenant will largely fall on you and your property management company. A professional deep cleaning is highly recommended for all newly vacated apartments after any necessary repairs and cosmetic touch ups/upgrades are completed.

 

Transfer Utility Accounts

Ensure all applicable utility accounts for the property in question are switched to the new tenants for the date of move-in to avoid paying for their bills. Unless stated in the lease agreement that certain or all bills are included in rent, it is advised to ask for evidence of account numbers set up in the incoming tenants names for the address of the property. Utilities such as gas, electricity, and water are the most common bills to be aware of, as utilities can often be forgotten about amongst the bigger

Repairs, Renovations and Replacements

Think about what you would expect an apartment to look like when you moved into it for the first time—that can be a starting guideline to knowing what you need to do for your tenants. For instance, if the paint and walls are dirty, scuffed, or scratched, you need to repaint them so that the apartment looks its best. Carpets may need to be replaced, broken appliances/features will need repairing, and non-working items will need replacing. Your new tenants are paying to live in a comfortable, habitable space, so it’s up to you to make sure their new home is livable and inviting. This upkeep will also help to attract high quality and happy tenants who will be more likely to look after the property and pay a higher rental rate.

Security and Safety

Beyond aesthetic work like repainting, your new tenant should be made aware of their responsibilities for maintaining their own safety and that of the property. For example, reporting any maintenance issues in a timely manner is imperative to addressing issues in a timely manner.

 

You’ll also need to rekey the locks for the apartment if previous sets of keys are not returned. This is a security measure that will prevent former tenants from having access to the unit, and thus, it keeps your new tenants optimally safe. Be sure to get the keys back from the old tenant, as well. Even with rekeying individual units, many buildings have master keys for the main entryway doors that may not be rekeyed every time someone moves. If a tenant doesn’t return keys, you may want to charge a fee to cover costs (and, when this is noted in the lease, it can incentivize them to return the keys!). If the tenant still doesn’t return keys, you’ll have to rekey everything their set had access to and take the costs from their security deposit.

 

A walk through inspection before you schedule any maintenance, so that you can make note of any repairs or other damages you’ll need to take out of the departing tenant’s security deposit (if there is one). Take photos of the unit and any damages and write down detailed descriptions of what was left for you to take care of. Having a detailed list of what you’ll be retaining a portion of the deposit for can help you down the road, particularly if the tenant fights you on the withholding of any or all of the deposit.

Make sure that everything is still in proper working order before a new tenant comes in. Check that the shower, toilet, and sink in the bathroom all function as they should, that the refrigerator and freezer are still working, and that electrical appliances, smoke alarms, carbon monoxide detectors, security alarms, and lights in the unit are still safe—there should not be any loose wires or broken bulbs when a new tenant moves in. You may not be required by law to provide new tenants with working light bulbs, but that small cost can be a good start to the tenant-landlord relationship, and should be considered. Filters should also be replaced or at least checked at the end of every tenancy.

How Property Management Companies Can Help You

If you’ve never worked with a property management company for your properties, you may be surprised at how much they can help with tenancy turnovers, as well as other aspects of being a landlord. They’ll be able to contract out the necessary work, market the property for new tenants, oversee and manage any work occurring at the property, and communicate with departing tenants to get everything squared away for you. You can hand off all of those pesky jobs to someone else and really reap the benefits of owning investment properties through true passive income.

Here at Lofty, we believe that owning investment properties shouldn’t be a headache. We take care of everything our owners need, from screening tenants to doing the physical work between occupancies. Stop wasting time checking whether lights are working and sweeping baseboards and start enjoying being a landlord and property owner!

For more information about how we can help you live the life you deserve, contact us today. Speak with one of our experts to find out how we can supercharge your investment.

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(844) 355-6389

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Month to Month Leases vs Annual/Long-Term Leases in Chicago Real Estate

By | Agents, brokers, Property Managemnt, Real Estate Investment

Tenant’s Lease Lengths to consider in Chicago Property Management for Maximum Return on Investment!

In the state of Illinois, and the City of Chicago, when a written lease for a specified term expires, the default rule is that the tenant is required to move out and may be evicted as a holdover tenant if he or she fails to do so.

If the tenant continues to pay rent to the landlord and the landlord continues to accept it, the terms of the written lease remain in effect until the tenant moves out.  However, the lease does not automatically renew for the same duration as the original lease without the landlord and tenant executing a document in writing agreeing to this.  Instead, the lease becomes a month to month lease, regardless of what the original term of the lease was.

We have previously detailed how tenant retention is the ideal scenario for Chicago property owners as this reduces/prevents vacancies and rent-less months. For this and other reasons, Lofty recommends only offering tenants annual, or 12+ monthly leases instead of month-to-month leases.

Cons of Month-to-Month Leases

With every pro comes a con, and month-to-month tenancy leases are no different. Although there are many benefits of offering month-to-month leases to your tenants, there are risks as well, including:

Lack of Stability

Although landlords may appreciate a month-to-month lease’s flexibility in some scenarios, it can also be a negative. Quality, long-term tenants often pay rent on time, take care of the rental, and pose less of a flight risk, whereas month-to-month leases can end at any time and therefore lack stability. This lack of certainty can make it hard to plan ahead to prevent future vacancies, which can be costly and time-consuming. It creates short-notice to accommodate maintenance or upgrades during a turnover, not to mention for marketing purposes.

Short notice for move outs

If you rent on a month-to-month basis, all your tenant is legally required to do to terminate this lease is provide you with proper notice. The length of their notice is typically 30 days if a tenant has resided at the property for less than 2 years, but check your state/local tenancy laws to confirm this. However, that doesn’t mean that the tenancy ends exactly 30 calendar days from the date the notice is delivered. Instead, it ends on the last day of the month, as long as it’s at least 30 days away. For example, if a landlord gives notice on August 1st, then the tenancy would be up August 31st. For example, if a landlord delivered notice on August 15th, the tenancy wouldn’t be up until September 30th. This is a strict requirement as Illinois courts have found that 29 days’ notice isn’t sufficient.

Short notice to find new tenants

Once you receive notice, you may find yourself scrambling to look for another tenant to prevent a vacancy. If you rush the process without proper tenant screening, your new tenant may not be the best fit for you and your property, and what’s worse than a vacancy is an eviction.

Risk of unexpected vacancy

Vacancies are the number one way landlords lose money, so if you can’t find a new tenant after your current one has moved out, remember that there are risks to leaving your rental vacant, on top of losing rental income.

It is highly recommended to consult a professional and experienced Real Estate Attorney if pursuing an eviction, or looking for legal advice on a specific situation due to continuously evolving Tenancy laws in Illinois, Chicago, and on a federal level.

At Lofty, we do not endorse nor encourage month-to-month leases due to the large array of problems they can create, in fact we actively discourage owners and tenants alike from pursuing them. If you are interested in month-to-month leases, we strongly advise you to do your research. If you would like help in transferring current tenants from month-to-month to annual leases, we have extensive experience and success in doing this!

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Creating an LLC vs buying Property in Chicago as an individual.

By | Agents, brokers, Property Managemnt, Real Estate Investment

Forming an LLC to purchase Chicago Property or investing as an individual.

In real-estate investing, it is common practice for owners to create a Limited Liability Company (LLC) and buy property under this LLC company. This is because many owners prefer to purchase real estate—or transfer the title(s) of real estate from an individual to the LLC—so that the LLC becomes the legal owner of record and not the individual. You can create an LLC by yourself, with a partner, or with a group. If you own an LLC, you are a “member” of the LLC. LLC entities are regulated on a state level, so the process of creating an LLC will differ by state.

There are several advantages of creating an LLC and purchasing real-estate through such a business entity.

1.    Professional Privacy

As a business owner, you might find the privacy of the LLC structure appealing when you buy a home with an LLC. Buying a house under an LLC ensures that the LLC’s name, not the owners’ names, appears on public documents and disclosures. In other words, LLCs allow you to replace your name with a corporate name, thereby concealing your identity and other information under the professional liaison of a company.

2.    Limited Liability

Limited liability means that you, as the owner, will not become personally liable for the company’s debts or liabilities. Therefore, if you have a fear of lawsuits as a business owner or real estate investor, the LLC structure may look very appealing to you. However, limitations exist within the limited liability structure.

For example, living in a home owned by an LLC can “pierce the corporate veil.” This legal term means that the owners, shareholders, or members of a corporation or LLC can become personally liable for corporate damages, as if the LLC structure never existed.

3.    Tax Benefits

The LLC structure can offer significant tax benefits, particularly because it eliminates double taxation. Double taxation refers to profits taxed at the business level first and then a second time at the personal level. Instead, LLCs enjoy a pass-through tax structure, which means that the LLC pays taxes on profits, but the owner of the LLC does not. However, LLC owners must pay taxes on their allocated share of profits.

4.    Easier To Invest With Partners

The LLC structure makes it easier to invest with partners – even other investors who don’t know the LLC’s principal owner. Two people can launch an LLC as partners, a second member can simply join a single-member LLC and create a multiple-member LLC. Members can also sell LLC shares by having an existing member sell their shares to a new member. Members must distribute 100% of the shares of an LLC.

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Keep in mind however that every silver living has a cloud, and there are some disadvantages to creating an LLC for investment purposes.

While LLCs are a great way to hold real estate, they unfortunately also have costs that go along with them. There is an associated cost to set up the LLC, and a responsibility to pay an annual fee of up to $500 to the state in which the LLC is organized. You may also have to file a separate tax return for the LLC. But the biggest issue you might have with an LLC is that lenders will consider your real estate ownership as an investment property. Once you fall into the investment-property bucket, the lending rules change and get more expensive.

With an LLC, the financial lender will send you to the commercial lending side of the bank. Generally, the interest rates and costs to finance your purchase are lower on the residential side than on the commercial side. Additionally, you may be able to borrow more against the property on the residential side than on the commercial side of a lender, where the down-payment requirement could be 35 percent or more.

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Despite the additional work and costs, the protection LLCs provide is often worth it for landlords. If you are interested in having our team guide you through this process, reach out to us today!

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How to leverage your Chicago property to expand your Real Estate Portfolio

By | Agents, brokers, Property Managemnt, Real Estate Investment

Buying more Chicago Property using existing owned Chicago Property

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A rental property is a good investment if bought properly. Managing it yourself might not be easy, which is why we advise that you use a Chicago property management company, such as Lofty Real Estate.

Firstly, let’s explain what Leverage in Real Estate is. Leverage in real estate simply means how much money you borrow to finance an investment property compared to the property’s worth. The higher your leverage, the higher your potential ROI. Leveraged real estate investing works best when rents and property values are rising.

As rents and the value of the real estate investment increase, their monthly mortgage for rental property remains constant, creating larger and larger profits. Today’s rents and property values are appreciating at an extraordinary rate to say the least – the ideal environment for real estate investors who know how to leverage real estate investments with borrowed money.

1. Leverage Existing Property to Buy More

Using your rental property as leverage to get another property is the easier way of leveraging property because the rental income paid by tenants can be used to pay up the mortgage on the rental property and gain some equity.

A second mortgage would also involve higher interest loans than the first, so you have to be absolutely sure your primary property has enough equity to cover the expenses associated with taking a second mortgage.

2. Leverage Your Primary Residence to Buy Another

Another way of leveraging property to buy property can be by using the equity on a primary residence to get another mortgage. It can be another house or even a rental property. This route will mean that your primary residence will be collateral to the lender if you default on the second mortgage payments.

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How to Get A Second Mortgage?

  1. Know How Much Equity You Have

Knowing how much equity you have will help you make a quick decision on whether or not to go for a second mortgage and leverage your property to buy property. The more equity you have, the more your chances of success when it comes to your application for a second mortgage.

2. Have a Good Credit Score

This may seem obvious, but it is also another key part of the process. An excellent credit score will also drastically improve your chances of being approved. If you’re interested in leveraging your primary Chicago property to buy another property, then you have to possess a credit score to match.

3. Pick out Your Preferred Second Mortgage Option

There are two options for you here, either you go for a HELOC or a home equity loan. Each option has its own risks and benefits, so be sure to pick one that suits you. If you’re leveraging Chicago property to buy another property, going for a HELOC might be best. On the other hand, if you’re leveraging property to buy a Chicago rental property, then going for a home equity loan where you’ll get a lump sum might prove to be the better option.

4. Shop Around

Once you’ve carried out these three steps, then it’s time for you to explore the options you have with lenders and their rates. Research the terms of each second mortgage with due diligence. Many financial lenders provide free quotes online or by phone after you’ve provided a few details, such as your credit score range, loan amount, term and the type of mortgage you’re interested in. Comparison websites may also offer insights to institutions that are not as well known to the general public. To get a solid rate offer you must get preapproved for a mortgage with each lender. When you apply for a mortgage, a lender verifies your income, finances, employment and credit to determine how much you can borrow and what interest rate you qualify for.

With home prices continuing to rise, it’s better to minimize your costs when possible on the borrowing side — and shopping around for a mortgage is the best way to do that!

Tax Benefits

When you leverage your real estate investment purchase, you get to depreciate the total cost of the property, not just the cash you put into it! This means you receive a significant tax deduction each year which can be a big incentive for a lot of prospective investors. You can write off any interest paid on the loan, which during the first several years is the majority of your loan payment. This provides another substantial tax deduction each year.

Real estate has some great tax benefits, and leverage allows you to take advantage of the interest deduction and depreciation on an amount much greater than what you’ve invested.

Leveraging property to buy property is a smart way of acquiring more property, especially if you have the required equity. With our guide, you have all you need to know about leveraging property to buy property. Reach out to a member of our team to discuss your options or to learn more about leveraging existing property to expand your investment portfolio!

Wondering if a switch might be right for you? Give us a shout and learn more.

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Why Is Resident Rental Retention so Important in Chicago Real Estate?

By | brokers, Property Management, real estate, Real Estate Investment

Keeping Tenants is the Ideal Chicago Property Management option to maximise rental income.

Turnovers mean vacancies, during which you’re not bringing in rents, yet still paying the mortgage. You might need to repaint, replace carpets, and professionally clean the unit thoroughly. There’s the marketing—advertising the vacant unit, showing it, holding open houses, collecting and processing rental applications, running tenant screening reports on all applicants, plus calling employers and prior landlords.

If you hire the help of a leasing agent or property manager, they will charge you a month’s rent/rental commission for their work too. The bottom line is that turnovers will devastate your Return on Investment (ROI). So how can you minimize your turnovers and keep your properties occupied at (nearly) all times?

The key is to retain your good renters for the long term. You want them so comfortable in your property that the idea of moving is a headache they would only consider under the most dire circumstances. The key to this starts from the beginning of their tenancy, by creating a great relationship with them. This can be created either through a great professional management company or individual landlords. Responsiveness, trust, and a nicely maintained property are the not-so-secret ingredients to this.

Finding great tenants is the first step; and our previous blog post outlines the best screening processes for this. Bad tenants can end up needing to be evicted in the worst case scenario, or at the very least, non-renewed. In other words, signing a lease with bad tenants is just setting yourself up for quick, expensive turnover. Also, try to keep out renters who move frequently from one home to the next. If you want to minimize turnovers, lease to renters who are stable and have a history of living in one home for more than 1 year, and avoid month-to-month leases.

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Communication is the next most important factor in maintaining tenants’ happiness and comfort in your property. By responding to maintenance requests, general questions, and complaints in a timely, friendly and professional manner you will create a positive relationship with your tenants that is essential to building a sense of trust, security and loyalty on both sides. If you have particularly quiet tenants who tend to not submit these queries, then try proactively reaching out to inquire if everything is going well and if there is anything they need to improve their quality of life in the property.

Small gestures such as birthday wishes, expressing thanks for good tenancy, and happy holiday sentiments can make a lot of difference when it comes around to discussing re-signing.

As Chicago emerges from the global pandemic, financial concerns are on everybody’s minds after the past year’s uncertainty. The tip that is especially relevant at this time, is to not increase the rental price where possible, or even to reduce rent slightly to encourage current Chicago tenants to re-sign for another year.

No matter how well you’ve done with any of the above tips, good renters won’t stick around if their neighbors are loud, criminally active, or are just plain rude. This is especially important for Chicago owners of multi-unit buildings, or multiple rental properties in Chicago.

Every month, look at which renters’ leases are coming up for renewal soon. If you have to ask yourself whether tenants are worth keeping, you already have your answer: non-renew them and get better renters. Multiple late rental payments, complaints from neighbors, excessively requesting maintenance requests due to negligence are all some signs that you should find better tenants. Landlords can constantly look for excuses and justifications to keep bad renters in an effort to avoid turnovers. Do yourself a favor and do not retain bad tenants! Great tenants who will live in your property long term are the best investment you will ever make.

Pondering hiring a property manager? Give us a shout and learn more.

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How Property Management Can Make Move-In and Move-Out Easier for You

By | brokers, Property Management, real estate, Real Estate Investment

The Perks of Property Management for tenant changeovers

When one lease ends and another begins, there’s a lot of work that needs to be done that can lead to a very busy and stressful time. Security deposits need to be sorted and returned to departing tenants, the first month’s rent needs to be collected from new renters, credit and background checks need to be confirmed, and in between, maintenance may need to be done on the property. Additionally, if you’ve got one tenant moving out without having one lined up to move in, that’s even more work—creating an ad and marketing the property, booking showings, and screening tenants. Altogether, it’s a lot of time that you could be using to do virtually anything else. Owning and managing investment properties shouldn’t be a mess of paperwork and endless busywork. If you’re tired of spending all of your time on what you thought would be a relatively passive way to earn extra income, you’ll be relieved to know that you’re not stuck—learn more about how property managers can make the move-in and move-out processes easier for Chicago landlords and property owners.

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What to Do When Tenants Move Out

When tenants’ leases end and they move out, there are a few things that property owners or landlords have to do, including:

These three tasks alone can be quite time consuming—finding vendors and contractors to take care of repairs, maintenance, and any updates you want to make can feel like you’re on a wild goose chase. Once you find contractors, you’ll have to fit them in your schedule during a time when you can be at the property. To say that it’s inconvenient is an understatement. Getting keys back from the tenant can also prove frustrating. If you’re working with a property manager, though, they can take the time to track down the tenant, so that you don’t have to deal with calling over and over again, getting their voicemail every time. Likewise, the best property management companies in Chicago will have a list of trusted, vetted vendors and contractors that they can schedule for any property maintenance you need, and you won’t have to be there for any of it if you don’t want to.

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Managing Vacancy Periods in Chicago Rentals

After one tenant moves out, one of two things will happen: there will be a vacancy period, or the next tenant will move right in. For now, let’s focus on the former.

If your property is vacant, you need to place ads, market the property, field phone calls from interested renters, schedule bookings, and show your property. If you’re trying to do this on your own, you can end up spending almost all of your extra time dealing with the property—which can feel like more work than it’s worth. Property management companies in Chicago have written hundreds of apartment, condo, and home ads, and in addition to knowing the best places to market your property, they can often work out better deals with publications than individual landlords or property owners can, simply due to the higher volume of ads they place.

You want your vacancy period to be as short as possible so that you aren’t losing money, and property managers will be able to set your rental price according to current trends and market demands. You won’t have to worry if you’re charging too much or not enough for your rental, and people will be more interested in the property when it’s priced well.

 

Once the property managers have shown your property and have some potential tenants lined up, they’ll be able to screen them, too. You won’t have to deal with background checks or conducting interviews. Property management companies have tried-and-true methods for ensuring they’re getting reliable tenants into properties, too, so you won’t have to worry about whether the tenants are the type of people who pay rent late every month or host loud, late-night parties in their studio apartments every weekend.

Working with a property manager means you won’t have to treat owning investment property like a second full-time job.

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Helping Tenants and Landlords with the Move-In Process

Now that you’ve got a tenant who is ready to move into your property (whether or not you had a vacancy period), you’ll have to do even more work. Some property owners and landlords like to be onsite when new tenants move in, for helping with anything that might come up, and if you own a lot of properties, that can mean busy days for you every time a new lease starts. You’ll also need to make sure that the new tenant has paid their first month of rent, which can, like getting the keys back at the end of a lease, sometimes be a frustrating process. New tenants may not know where to send rent at first, too, which can lead to a late payment or two. You shouldn’t have to worry about tracking down your payments, and when you work with a property management company in Chicago, you won’t have to. Property managers take care of everything related to the tenant move-in process. They can be onsite during the move, they can track down your rent checks, and if anything happens during the move-in process, they can quickly schedule maintenance or repairs. It’s a level of convenience that’ll have you wondering why you didn’t start up with a property management company sooner.

Enjoy Your Time and Your Property

Here at Lofty, we understand that your time is your most valuable commodity, and we work hard to ensure you won’t have to waste it doing busy work for your rentals. We can take care of everything during the move-in and move-out processes for your properties, and we can also manage vacancies so that you can earn more money. To start living the life you deserve to live, give us a call anytime—we’d love to work with you and help make your life easier.

Speak with one of our experts to find out how we can supercharge your investment.

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How to find the perfect tenants while Leasing in Chicago

By | Agents, brokers, Property Management, real estate, Real Estate Investment

The best screening process for Chicago tenants & how to avoid bad rental tenants.

At Lofty, we have experienced our fair share of “bad” tenants taken on from other Property Management companies or individual landlords. Unfortunately, there will always be fraudsters, scammers, and dishonest people attempting to get good housing by lying about their financial situation, tenancy history, credit score, or employment status etc. To avoid having to then pursue a costly and time-consuming eviction process of these bad tenants, the first step is to have a good and basically fool-proof screening system in place.

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Every Chicago landlord should know that every successful Chicago apartment tenancy begins with a proper tenant screening and a tenant credit check.  Due to recent changes in Cook County law, landlords and Property Managers have been revisiting their tenant screening procedures in 2020, when a new Cook County anti-discrimination law called the Just Housing Ordinance went into effect. That, on top of concerns in getting stuck with a tenant that then can’t be evicted due to Governor Pritzker’s continued eviction moratorium, has made property owners and managers extra cautious of being vigilant in their screening process.

Some basics to know before we dive into having the best screening process for Chicago Tenants.

  • If you are interested in Property Management services, the company you choose should handle all tenant screenings through a concise and streamlined process that they have perfected through experience so you don’t have to.
  • Tenant Applicants pay for the cost of screening and background checks. There is no cost to the landlord/owner as this is part of the application process.
  • Be warned, that while some applicants may look perfect on paper, this can indicate that it may be too good to be true. Use your good judgement, the advice of real estate professionals, and further research if in doubt. Remember, references are there to be contacted!
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Why Where You Advertise Your Application Matters:

There is no doubt that there are positives to every platform of advertising, and this post is not meant to discredit any of them. However, to find stellar tenants there are platforms that are less likely to receive positive results than others. The likes of Craigslist and Facebook marketplace, while not bad by any means, will undoubtedly receive drastically different results than the likes of via a professional real estate company’s website, word-of-mouth recommendations from trusted people, and those represented by an agent. This is because of the varying target audience and varying degrees of perceived professionalism. Someone applying for a rental via Craigslist may not feel the need to have a 650+ credit score, whereas other platforms will make this a requirement to even apply, nevermind to be considered.

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Do you Need to Know any Chicago/IL/National Tenant Screening Laws?

All landlords should be familiar with applicable tenancy laws. In April of 2019, the Cook County Board of Commissioners voted to pass the Just Housing Ordinance (JHO), with the ordinance scheduled to take effect on December 31, 2019. This requires all landlords in Cook County to assess a potential tenant’s qualifications before looking at his/her criminal history. It prohibits landlords from denying housing on the basis of arrests, juvenile records, sealed and expunged records. If a criminal background check shows that an applicant has a criminal conviction, the landlord must disclose the source of the information to the applicant so that he/she can dispute its accuracy. Landlords must also perform an individualized assessment of the tenant’s criminal history before denying housing.

In addition to concerns about criminal history, most landlords review a tenant’s credit history. Federal law mandates that all three major credit bureaus—TransUnion, Experian, and Equifax—require landlords to undergo a rigorous on-site inspection by a licensed third party inspector before receiving an applicant’s full credit check report. Inspectors check to make sure that reports are stored in a locked file cabinet, that there is a shredder onsite, and that the landlord’s home office is separate from the living area. Inspections can take several days to schedule and incur an additional cost to the landlord. Additionally, many part-time landlords may not pass such an inspection. However, if the applicant initiates the tenant screening process, an on-site inspection is not required, which is ideal for smaller landlords who screen tenants only a few times each year.

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What Questions Should You Ask?

Landlords should ask for contact information of at least 2 previous landlords (not roommates, friends, or significant others) in the tenant’s rental application form, follow up with, and verify them as such. Aside from the obvious questions about eviction and damages in the tenant’s history, landlords should also inquire about complaints from neighbors, cleanliness of the apartment and any other potential red flags in their apartment rental history.

All Chicago apartment landlords should not accept any rental application, irrespective of the results of a credit report, until they’ve examined a bona fide form of photo identification clearly tying the prospective tenant to the name on the report. Careful landlords should check the birthdate on a credit report to the birthdate on a driver’s license to ensure that children who bear the same name as their parents do not attempt to finagle their way into a lease by substituting their parents’ pristine credit for their own. That has been known to happen from time to time, so landlords should themselves a favor when they’re being vigilant in their own “pre-screening” process. For landlords who do not have the time for these steps, it is strongly advised to not cut corners and to be aware that Property Managers are often hired for this exact purpose.

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What Information will a Tenant Credit Check provide you with?

Valuable information such as, does the applicant have outstanding debt, past bankruptcy filings, or other financial obligations? Do they have large balances on credit cards? Do they have any liens taken out against them or their property? These answers could have major implications to a tenant’s ability to pay the rent in full and on time and are included in a full credit report.

Landlords should determine an acceptable range of credit to move forward with a tenant’s application. A healthy credit score should be consistent, similar in range from the three credit bureaus, and ideally are not thin files (less than five sources of credit). Landlords should apply the same credit history requirements to all tenants — remember that in Chicago and Cook County, landlords cannot discriminate based on a tenant’s source of income. Landlords should be familiar with fair housing laws and can read more about how they work here.

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What are the main problems of tenant screening services?

Many tenant screening services conducted by third-parties are beneficial for a number of reasons, namely that they’re efficient. Landlords looking for this may appreciate a quick, cost-effective screening process, however there are some drawbacks associated with this convenience. Namely, the reliability of the aggregated data. These third-party companies are pulling data from a number of public databases, and with a common surname there is an increased likelihood that landlords will see results for a completely different person in their tenant screening report. This is not the norm, but unfortunately it can be quite common.

Another problem with tenant screening reports comes in the form of customer service. Tenant screenings are generally viewed as speedy and quick transactions that follow the typical script of 1) landlord provides email address to screening company, 2) applicant receives email from the company and pays the screening fee, 3) credit report comes back to the landlord, and then the ball is in the landlord’s court. The decision to move forward with an applicant is squarely on them and they (hopefully) hold enough information to make an informed, unbiased decision. If the decision is to not move forward with a tenant’s application because of something on the credit report, then the landlord must inform the tenant that the credit check was the issue. The Federal Fair Credit Reporting Act requires landlords to provide an adverse action letter to tenants to inform them that something in the credit report was concerning and the name and contact information for that credit agency, too, so that the tenant can request a copy.

What Does My Ideal Tenant Look Like?

If you feel uncomfortable accepting credit scores lower than, for example 650, but you want to offer the option of a cosigner, then the same due diligence is required for checking the co-signer’s credit, employment history, criminal history etc. At Lofty, we take the approach that a good rent to income ratio is 30% or higher, a credit score of 650+, and continuous employment of 3 months or longer. Specific landlord requirements can deviate from this, and while tenant applicants do not need a 800+ credit score and earn x6 times the rental cost to be good tenants – if something seems suspicious about an applicant’s details don’t be afraid to ask for further information. Remember that there will be other applicants, and you should never accept just any application for fear of not finding more!

If you are interested in learning how hiring Lofty as your Property Management company can eliminate the stress from the tenant screening process, reach out to a member of our team today!

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Is it time to Hire a Chicago Property Management Company?

By | Agents, Property Management, real estate, Real Estate Investment

When is Property Management worth the Investment?

If you’re already a landlord managing your own rental property, you are probably already aware of the headaches that can be caused by property management. If you are an aspiring or soon-to-be landlord, be warned that property management can be an unpleasant experience at times.

While it is true that there are worst-case scenarios out there of tenants squatting, refusing to pay rent, destroying a property, sub-letting to strangers without owner approval etc., these are honestly rare and few and far between. That is not to say that this won’t happen to you or your property, but just that it is very statistically unlikely. The first way to improve your chances of preventing this type of behavior in a tenant is to have a great screening system in place. This is where a Property Management company can first come in useful. A professional Management company will have their screening process streamlined to be supportive of finding you the very best tenant in terms of income, credit score, landlord/employment references, and tenant history.

Inserting some distance between yourself and the tenant(s).

Property managers are built to tackle the dreary aspects of real estate leasing and administration. It’s basically like paying someone else to have your headaches. Among other things, property management firms have ready access to maintenance contractors, familiarity with local renters law, experience with the tenant application process, and financial reporting software. Additionally, property managers shield landlords from tenants, making it wonderfully easy to refuse a request for rent relief. The landlord simply says “no,” while the property manager is hired to be the bad guy.

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What do property manger’s do?

The services performed by a property manager typically include:

  • Managing the tenant application process with a thorough screening process
  • Holding security deposit funds in escrows and ensuring compliance with local law
  • Renewing, ending leases, re-renting vacant properties, managing evictions.
  • Collecting and accounting for rent, including the assessment of late fees
  • Addressing routine maintenance problems
  • Periodically inspecting the property, including at the termination of the tenancy
  • Cleaning and re-keying property at the conclusion of the lease
  • Financial Bookkeeping, Providing Tax Reporting Documents
  • Liaising with tenants over disputes and issues
  • Overseeing Property Renovations

How much is a property manager?

The cost of hiring a property manager is typically a percentage of the monthly rent, plus various fees for incidental services. There may also be a vacancy fee (in case the apartment is not generating any income), a lease renewal fee or even an initiation fee. Typically, the base fee ranges from 8% to 12% of the monthly revenue (the cost is tax deductible.) At Lofty however, we charge a flat rate fee dependent on the number of units in a building so that owners are not limited by their rental value.

Landlords who live in a different city or even country to the property they rent to tenants, travel regularly, own multiple properties, or simply lack free time are all ideal candidates for property management assistance. If you’re a landlord, and you’re considering hiring a property manager, be sure to find out the following information while doing your research, to find out if they are the company for you:

  • What makes you different from other management companies?
  • Who will be assigned to manage my property? (It’s nice to meet/speak to the person you’ll soon be spending considerable time with)
  • How responsive will you be? Can you be reached 24/7/365?
  • What is your proposed fee structure? What functions are included within the fee and what functions entail additional expense?
  • What types of relationships do you have with vendors? Do you have preferred contractors? If so, in what areas? Do you have any financial arrangement or understanding with any such contractors that is not disclosed to your clients?
  • What software tools do you use and are they user friendly?
  • Are you and your employees properly licensed under Illinois law?

At the end of the day, hiring a Property Management company is a personal/business decision that is intended to make life easier for the property owner. When problems outweigh the positives of owning property, or you want to proactively prevent this from happening, Property Management will be worth the investment. If you need help managing your property, there are plenty of high quality companies out there, like Lofty, to help you manage your investment to ensure you get the best returns out of it!

What to learn more about property management? Give us a shout and learn more.

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Time to Invest in Chicagoland Real Estate

By | Agents, home buyer, home buying, real estate

Is Now the Time to Buy Property in Chicago?

First-time buyers, recurring real-estate investors, or acquisitions companies; no matter who you are, investing in real-estate is once again becoming more popular following on from the infamous 2007 Global Financial Crisis. With digital platform growth, there is an increasing accessibility to education on the topic creating an invigorated awareness to increase financial gains. Investing can be a great way to prepare financially for the future, and to help shelter against future economic recessions or declines.

Last year saw a complete shutdown of Chicago’s hospitality, entertainment and tourist industries. Many streams of property owner’s income like Airbnb or Vrbo dried up, leaving many landlords grappling for financial stability. With states and countries alike now starting to re-open and allow travel, this may be the chance to get a head start on what is sure to be a boom in the tourist industry. Property owners can get in on this by making their properties available for short term stays in between long-term leases, or even solely focus on this particular market of renting.

With the Chicago society and economy set to fully open in July, and the rest of the United States and beyond following suit/preceding this move, an increase in the need for short-term, long-term and seasonal housing is imminent. This demand is reflected in the steadily increasing prices in the market compared to the same time last year, indicating that now is a great time to invest in Chicago real estate before prices climb back to their pre-pandemic rates – or even surpass them!

With real estate representing a dangerous and burdensome investment during the 2020 pandemic, this sense of trepidation is finally receding. Whether you are looking to invest in a personal home, downsize, upsize, purchase a single family or multi-unit building to rent for additional income, or begin a commercial business investment, 2021 is set to be a great year for making these types of purchases in Chicago!

Get started & learn how Lofty Real Estate can help you invest in Real Estate?  Let’s Chat!

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Chicago Renting Trends Post-Covid

By | Agents, brokers, Property Management, Property Managemnt, real estate, Real Estate Investment

After-effects of the Pandemic on Chicago’s Rental Real Estate Industry

It should be a surprise to nobody that this pandemic has caused a ginormous shift in almost every industry known to the modern business world. While the world stood still early last year, many industries took a detrimental hit financially. Real estate was not spared, and now, as things slowly but surely begin to gleam a light of hope to the return of normalcy, rental trends are once again pointing upwards.

As more and more people get the vaccine and leave remote working behind, the return to the office is beginning to reinvigorate big cities like Chicago. Bars, restaurants, beauty salons and gyms are all open, albeit with mask-mandates, capacity limitations and increased cleaning processes. Commercial space that has laid vacant for months is starting to become occupied once again.

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Leases are being snapped up quickly as downtown apartment units are once again becoming more expensive to rent thanks to the ending of a stretch during the pandemic when tenants enjoyed flat or falling rental prices and widespread landlord concessions such as first month free, no move-in fees or included utilities.

Higher rents could contribute to an anticipated rise in inflation, accrued by multiple federal stimulus checks, low borrowing interest rates and pent-up demand after months when the pandemic damped consumer spending. Rent typically accounts for about one-third of the consumer-price index, which economists expect to increase in the months ahead. Renters can therefore expect to see a noticeable rise in their outcome, and are being encouraged to plan accordingly.

Looking for a Property Management Team that can help navigate you through post-Covid? Give us a shout and learn more.

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Chicago Affordable Housing 101: Tenants & Landlords

By | Agents, brokers, Property Management, Property Managemnt, real estate, Real Estate Investment, tenants

A basic guide to Chicago Affordable Housing Options for both renters and owners

The Chicago Housing Authority is the third largest public housing agency in the nation. CHA serves more than 20,000 low-income households, by providing safe, decent and affordable housing in healthy, vibrant communities. Public housing provides homes for families, the elderly and those with disabilities from scattered single family houses to apartments for elderly families.

There has long been a stigma against those on the Affordable Housing scheme. Now, with a significant portion of Chicago’s population still financially reeling from the pandemic, the market for affordable housing has increased dramatically in the past year.

For tenants seeking information on how to apply for this affordable housing, they are advised that CHA’s Housing Choice Voucher Program (previously called Section 8) allows low-income families to rent quality housing in the private market via federal funds.

Through this Program, CHA pays a portion of eligible families’ rent each month directly to the property owner. Families can use their vouchers to rent a house or apartment in the private market throughout the city of Chicago.  Because there are more families who need rental assistance than there are funds available, CHA uses a waiting list to administer the program to eligible families. Names are selected for the waiting list randomly using a lottery process. Participants in the HCV program pay approximately 30% of their income for rent and utilities. Applicants are advised to check the eligibility requirements to qualify for the HCV Program before applying.

For landlords interested in having their private property being leased to Affordable Housing applicants, the following steps summarize the process to become an HCV property owner:

  1. Attend Owner Briefing (Recommended)
  2. Market your property
  3. Complete and submit a Request for Tenancy Approval (RTA)
  4. Pass Housing Quality Standards CHA owner eligibility screening (HQS) Inspection
  5. Accept CHA rent offer
  6. Execute lease and Housing Assistance Payment (HAP) contract
  7. Comply with HUD and CHA’s rules and regulations

Every Regional provides a resource center that includes a wide range of information, internet access, property listings.  Each resource center is open Monday through Friday from 8:00 a.m. – 5:00 p.m. No appointment is necessary.

For more information see the Property Owner Guidebook.

While this route is not for every landlord/property owner, it may be an option for some who have never thought to consider it before. As with non-HCVP tenants, there are pros and cons to this decision that may not be for everyone. This is simply an informative guide meant to explore the many options available to Chicago property owners.

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Some advantages/incentives include:

In order to provide an incentive for property owners to rent units to CHA voucher holders in “Mobility Areas,” the Chicago Housing Authority is implementing a program that provides new HCV property owners an additional lump sum payment equal to the monthly contract rent if they lease a unit to a voucher holder in these designated areas. Effective March 1, 2018, a Mobility Area is defined as a Chicago community area with 20% or fewer of its families with income below the poverty level and a below median reported violent crime count (normalized by the community area’s total population). Some community areas with improving poverty and violent crime rates along with significant job clusters are also designated as Mobility Areas.

Under state law, Illinois property owners who rent to participants in the Housing Choice Voucher (HCV) Program may receive property tax abatement (“tax savings”) in an amount up to 19% of a property’s Equalized Assessed Value (EAV). The actual amount will depend upon tax rates, the state equalizer, EAV and the number of qualified units rented to HCV Program participants. This however, is dependent on meeting certain criteria.

CHA portion of rent is guaranteed on-time income so long as inspections are passed and the property is kept in good condition for the tenant(s).

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Some consequences/disadvantages include:

The CHA requires regular inspections of the property to maintain its habitable condition for the tenants. This involves planning, paperwork and if an inspection fails, owners will not receive rental income until the failing items have been corrected.

As this program is for low-income residents, there may be maintenance issues that a financially independent tenant would deal with but a HCVP tenant can not afford. Some of those items are the ones that often crop up in the county inspections.  Others are lease obligations a HCVP tenant can’t cover

Learn More About Chicago Affordable Housing. Give us a shout today.

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Chicago Real Estate is on Uniquely Solid Ground

By | Agents, brokers, Property Management, real estate

Chicago Real Estate Boom: Simply Unlike the Last One

Last week, the Wall Street Journal addressed a topic that’s been on the back burner for some time: the likelihood (or not) that the steady rise in housing prices might be a precursor of a future bust like the one that racked this century’s first decade. Real estate reporter Nicole Friedman’s piece presented a persuasive case for differentiating the two sets of circumstances—a welcome backdrop for this season’s home sellers and buyers (and for Chicago real estate in general).

“It’s Different from the Last One” was the top-line verdict regarding what the Journal called “the current housing boom”—a characterization based on the nation’s home sales, which “are hitting peaks last seen in 2006.” Some of the statistically verified reasons:

  • Mortgage-lending standards are stricter.
  • Down payments are higher.
  • Tight inventories are nearly certain to continue to support prices.
  • Economists say there are more barriers to entry—making buyers less prone to default.
  • Demographics indicate a number of long-term trends “that will keep the housing market hot,” enabling even debt-ridden homeowners to sell at a profit rather than slide into foreclosure.
  • New buyers are being attracted by historically low-interest rates rather than easy access to credit.

With new-home construction continuing to lag demand—and as millennials age into their prime homebuying years—the demographic picture is substantially different from that which preceded the 2007 collapse. If this is anything like a bubble, it’s more like a cast-iron one!

With winter behind us, the Chicago real estate market is entering its busy spring season—one that you might want to join. No matter if you are looking to buy, sell, or looking for a property manager, give us a shout.  We will be standing by to help you explore the possibilities!

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Chicago Real Estate and Five Major Trends for 2021

By | Agents, brokers, home buying, Property Management, real estate, Real Estate Investment

Finance Guru’s Five Real Estate Trends for 2021

Dave Ramsey is a standout among media finance coaches. It’s hard to disagree with his brand of commonsensical counsel that eschews shortcuts and paths to riches that depend on newly concocted strategies. Chicago real estate investors, potential homeowners, devoted readers and listeners who rely on his consistently risk-averse advice learn to avoid high-interest debt while building a solid financial base—a footing typically anchored by the equity most real estate investors and homeowners build through their greatest investment, their home.

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As the old year came to a close, Ramsey’s website laid down five trends that are likely to emerge in the coming year. Chicago homeowners and investors who have been tracking the national real estate crosscurrents would not have been surprised by any of the five—but would likely be reassured by the continuity they exhibit:

  1. In the coming year, inventories of homes for sale will continue to be thin. As a result, buyers may need to be more flexible than usual in the features and locations they can insist upon—while sellers may find themselves increasingly in the driver’s seat.
  2. Prices should continue to rise, which would make the conservative ‘Ramsey Rule’ (house payments should not exceed 25% of take-home pay) difficult to follow, were it not for—
  3. The continuation of ‘nice and low’ mortgage interest rates, which markedly moderates the effect of the first two trends.
  4. Online and virtual services will continue to expand what you can accomplish via mouse-clicks rather than actual, in-person activity. Ramsey does have a warning for sellers about the advisability of resorting to cut-rate virtual services: “Your home is your biggest asset, and you get what you pay for!”
  5. Likewise, increasingly popular “Risky Buying Options” (like down payment loans or overly expensive rent-to-own offers) rate his one-word review: “beware.”

The Ramsey vision for 2021 is also in line with a projection voiced by government-sponsored Freddie Mac—continuing price rises make a real estate market crash unlikely. Both foresee that sellers in previously less-popular neighborhoods can expect an uptick in buyer interest.

When future trends are continuations of those already in evidence, it’s not particularly earthshaking. More beneficial is the final Ramsey note on how to take control of the trends: “Partner with a top-notch professional real estate agent.

We couldn’t agree more!      

Ready to learn how Lofty Real Estate can help you with your investment properties?  Let’s Chat!

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Looking Back: How did 2020 Fare for Real Estate?

By | Agents, brokers, home buying, Property Management, real estate, Real Estate Investment

New Year’s Retrospective Cheers Chicago Real Estate Watchers

Gather ‘round, people: it’s The Year in Review time again—the week when columnists and TV talking heads line up to chatter and lament over the year’s record-shattering advances and failures. From Washington to Hollywood, Wall Street to Silicon Valley, 2020 provided as rich a trove of talking points as any year in memory.

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Closer to home, for Chicago homeowners and investors, the year in real estate was no exception. When news of COVID-19 first broke, it looked as if the pandemic’s spread might claim Chicago real estate as an early casualty. Yet, despite the persistence of distressing developments in a host of other areas, local real estate watchers watched a much different picture being painted across the nation.

Here’s a selection of a half dozen highlights from The Year that Was in U.S. real estate:

  • The complete numbers aren’t in yet, but as of October, existing-home sales grew by a “spectacular 26.6% compared with last year” (according to reuters.com).
  • 2020 ends the year on track to register 102 straight months of year-over-year median home price increases.
  • For house flippers, the median gross profit per flip increased to its highest in two decades—$73,766—according to ATTOM Data Solutions.
  • The year ends with pending home sales up 20%, buyer traffic up 32%, and mortgage applications up 27% over 2019—signals that, according to NAR Chief Economist Lawrence Yun, “…this winter may be the best ever for the housing market.”
  • By October, median existing-home prices had risen 15.5% compared with a year ago.
  • In a reversal of past age groups’ preferences, 55% of millennials (they outnumber all other generations) are not only stock market skeptics but “are now interested in investing in real estate,” according to realwealthnetwork.com.

For Chicago real estate watchers, those are results that justify putting a bottle of the bubbly in the fridge to chill for seeing in the New Year. And for all our Chicago neighbors, here’s hoping 2021 can hold a candle to this year, real estate-wise—and that it’s a whole lot better where everything else is concerned!

Looking to invest, purchase, sell, or need a property manager? Give us a shout to learn what the Lofty team can do for you.

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Motley Fool Recommends a “Drawback” for Chicago Investors

By | Agents, brokers, Property Management, real estate, Real Estate Investment

Investors Benefit from this “Drawback”

Ever since its founding nearly 30 years ago, investors have been entertained and educated by The Motley Fool—the financial and investing advice company known for its good-humored “foolish take” on stock market matters. The firm started out by publishing a run-of-the-mill newsletter but burst into national prominence through a series of creative April Fool’s messages hyping a fictitious sewage-disposal company’s stock. The series mercilessly mocked penny stock promotions.

Through the years, the company’s output has garnered both champions and detractors. Nevertheless, through thick and thin, the Fool has retained its light-hearted tone.

When to Appeal Your Property Tax Assessment

Real estate investing has long been one of its central topics, even generating a specialized sub-brand called millionacres. Chicago investors who have checked in from time to time on this site have read answers to topics like “Is Real Estate a Good Investment?” (“The short answer is ‘yes’”) and “How to Invest in Real Estate” (there are “dozens of paths”).

Their research can yield solid nuggets that Chicago investors find valuable—like a Federal Reserve paper that shows real estate has historically generated rates of return comparable to stocks and equities but with much lower volatility.

In the same discussion promoting real estate as a “core pillar” of any investment portfolio is a typically “foolish” (and startling) idea—that real estate investments have a hidden benefit: illiquidity!  Normally, the lack of liquidity—that is, that it takes time and effort to turn Chicago real estate investments into cash—is listed as a major drawback. Whereas a Wall Street stock investment can be easily sold at a moment’s notice, the opposite is true for real estate. But the Fools take the opposite point of view—and they have a good point. The financial barriers that are built into real estate investments practically force a long-term perspective. They prevent decisions made in haste, based on fear or greed—thus keeping panicky investors from becoming their own worst enemy. The upshot is to instill real estate investments with “the most powerful wealth-building tool ever imagined: compounded annual returns.”

Chicago real estate offers strategic wealth-building possibilities for end-of-year investors. Call us for more on the current opportunities!

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Buying Chicago Investment Properties

Chicago Rental Properties are Dual-Track Investments

By | Agents, brokers, Property Managemnt, Real Estate Investment

Chicago Rental Properties Have Multiple Growth Opportunities

Chicago rental properties can bring their owners substantial investment income at the same time they are quietly building equity. It sounds clever—and it is clever, as many legendary titans of industry have pointed out.

Nineteenth-century millionaire-philanthropist Andrew Carnegie’s “Ninety percent of all millionaires become so through owning real estate” is typical.

More recently is this quote from wealth-creation expert Robert Kyosaki, author of the mega-bestseller, Rich Dad, Poor Dad:

If you don’t like real estate, all you have to do is make hamburgers, build a business around that hamburger, and franchise it.”

Kyosaki’s sly observation lets us draw our own conclusions about the relative likelihood of becoming a one-in-a-billion entrepreneurial superstar like McDonald’s Ray Kroc…versus choosing a canny real estate investment!

That’s not to say that the road to riches is a simple one-step process—especially when the chosen strategy includes actively managing a rental property.  For Chicago rentals properties to maximize cash flow in addition to their underlying equity growth, the original purchase needs to be made in a market-wise manner—then followed with managerial skill.

Lofty Real Estate property managers and brokers are here to help clients identify and acquire the Chicago property that fits their investment objectives—and right now, Chicago has a number you will probably find worth investigating.

Despite the latest pandemic-related precautionary measures, it’s still possible to explore the current offerings while maintaining maximum safety.

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How Seasonal Shopping Events Support Chicago Homeowners

By | Agents, brokers, home buyer, Neighborhood Guides, real estate, Real Estate Investment

With Thanksgiving Day gatherings behind us, this year’s Chicago holiday shopping action re-focused on the Black Friday sales phenomenon. Early reports were encouraging—but confirmed what Chicago businesspeople expected: a substantial tilt to home-based shopping.

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CNBC’s initial late-night observation was that bargain hunters were ringing up record online sales. This was a result that had been foreseen by retailers, who had prepared for the reluctance consumers might show to in-person shopping.

Even so, the National Retail Federation had projected that this year’s holiday sales would grow by somewhere between 3.6%-5.2%. If that proves accurate, sales will exceed averages reached during the previous five holiday seasons—a shot of good economic news for this seesawing (some would say, ‘whipsawing’) year.

At least as significant for Chicago businesses was Black Friday’s weekend successor—Small Business Saturday—which USA Today called “crucial” for myriads of local U.S. establishments. Many local Chicago businesspeople would probably agree, having spent most of 2020 battling spikes in COVID-19 and the strictures aimed at curbing its spread. For the many Chicago small businesses who succeeded in improving their online sales functionality, this week’s Cyber Monday looked to possibly match the national projections, which were widely expected to set sales records of their own.

Much of the media’s coverage urging patronage of local businesses emphasized the altruistic nature of “shopping local”—but from a local homeowner’s perspective, doing so is equally self-serving. Real estate’s “location, location, location” exhortation includes the attractiveness of the community—which is instantly recognizable by visitors in the energy and vitality on display through its local commercial outlets. That activity attracts further investment—or not. And the whole package winds up being reflected in property values—not just in its commercial sector, but in the residential community surrounding it. Area homeowners who make a point of patronizing our own Chicago merchants don’t just keep their neighbors and neighborhoods humming—they assure that local properties will see their values continue to advance in the years ahead.

For all your own Chicago real estate dealings, do give Lofty a call!

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3 Things Investors Must Analyze When Buying A Chicago Rental Property

By | Agents, brokers, Property Management, real estate, Real Estate Investment

Thinking about investing in residential real estate? Maybe you already own a few residential properties and you are looking to expand? You may or may not already know, there is a lot to consider when determining what kind of property will make an ideal candidate as a rental property. It is important to analyze every property you are considering as an investment; not doing so can be a costly mistake. To help you make the best investment, we have broken down what makes a great rental property.

  1. Crunch the Numbers

When you are digesting all the factors of a property to determine whether it would be a good rental, it does not stop at just the math. But an investment can start or not start depending on the math, so be sure to break everything down and analyze all the numbers as you work towards your decision.

Rent-to-Value Ratio

First and foremost, what is the rent-to-value ratio ratio of the property? Rent-to-value is one year of rent divided by the price of the property gives you the gross rent yield. There is not a hard and fast rule for where the gross rent yield should be, but typically they fall between 3 and 8 percent, depending on the location of the property. Usually the better investment is the property that has the higher rent yield. It is not an absolute law of an investment’s success, but knowing a property’s rent-to-value ratio will help determine which properties may be better suited as rental properties over others.

Cash Flow

Another factor to think about when considering the viability of a property as a rental is its cash flow. This is the monthly rent minus all expenses associated with the property; including mortgage, taxes, insurance, HOA dues, maintenance, vacancies, etc. Once everything is calculated, are you happy with the number you have? If it is much lower than you would like, maybe you should consider a different property.

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  1. Location, Location, Location

Real estate professionals love to say that, but it is true! Location is huge factor when it comes to investing in real estate. Several factors in regards to the property’s location will determine whether your investment is fruitful, so it is crucial to consider all of them and to do your research.

Already Popular Or Still Rising

What is the neighborhood like? Is it well-established, up-and-coming, something else entirely? Established neighborhoods are a great place invest; property values are usually stable so it is less risky of an investment. However, that can also make it more difficult to make money. If the initial cost of the property is higher, there is less room for profit.

On the other hand, though it is more risky, investing in an up-and-coming neighborhood may give you more room for profit. You may be able to get a property at a lower cost, and though initially profits may be lower, as the neighborhood becomes more established, property values and rent prices tend to increase. The payoff can be high, but there is also more risk involved.

Some neighborhoods can take years to become more established and some others never take off as expected. If possible, find out if any building permits were issued nearby? Are there any new businesses moving in or future developments planned? This will help give you an idea of the speed of growth in the neighborhood. To ensure that you make the best investment for you, be diligent in your research and consider talking your plans over with an expert who is well-versed in neighborhood growth and real estate trends.

Education Is So Important

The neighborhood schools may not be important to every potential tenant, but for the ones who find it important, it can be a major importance. The quality of the schools in the area are often a top factor when they choose where to live. Check out the quality of not only the public schools in the area of the property you are considering but also any nearby private schools.

Neighborhood Watch

Nobody wants to live in an area that is a hotbed for criminal activity. The crime rate will play a major role in not only the value of the property you are considering but also the ease in which you will find tenants. You should be able to acquire updated crime statistics for the area you are considering. Pay close attention to violent crimes, vandalism, and theft, and look for any signs of increase or slowdown in criminal activity.

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  1. The Property

Now that you have considered the location and the dollars and sense of the investment, let us now think about the physical property. It is not as cut-and-dry as just choosing a property that looks nice and is in your prices range; there are several factors to consider.

What Type of Property is It?

There are many different types of residential properties available so one of the first things you need to decide is what type of property are you looking for. A single-family home or a condominium is great for any investor, but if you are a first time or beginning investor they are the ideal property.

Single-family homes are nice because they tend to attract long-term tenants such as young families or couples looking to start a family, so you will not have to worry as much about vacancy. Condominiums are nice for a beginner because they tend to be low maintenance. Owners are responsible for interior repairs; this leaves any exterior repairs as the responsibility of the Home Owners Association.

However, that can bring about another issue. HOA fees can be high so it is important to consider those into your figures when determining the potential value of the investment. Also, make sure you look into the financial health of the HOA because you do not want to end up footing the bills for a struggling HOA.

If you are a more experienced investor, you may be thinking about a multi-unit investment. This type of property has multiple tenants in one building and can range from a duplex to an apartment building and anything in between. With this type of property, tenants could solely occupy the units or you could live in one unit with tenants occupying the remaining units. Living in one of the unit could be a beneficial way for you to save money personally and possibly save money on fees involved in financing a multi-unit property.

Whether you are a beginner or an experienced investor, meeting with a real estate professional to discuss what type of property is ideal for your individual situation will help you make the best possible investment.

Skip the Fixer Upper

Many people like to purchase property that needs moderate to major amounts of work, thinking that they can make a lot of money. Properties that require a lot of work can be bought at significantly lower price, but they are best avoided by those new to investing in real estate. Unfortunately, many people end up spending more money than they planned and do not make the kind of money they expected. Do not get us wrong here, there are people that do this and are very successful at it. We have found that, in the beginning, it is better to leave the fixer uppers to those that already do it well.

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There is a lot to consider when purchasing a residential property as an investment and it can require a certain amount of legwork to determine what is best for you. Consulting an expert in the field will help take some of the work out of your hands. Here at Lofty, we do just that—we have the experience and the knowledge at our fingertips to help relieve you of the extra work and help you make the right real estate investment choices. Talk to us and see how we can help you live the life you deserve.

Speak with one of our experts to find out how we can supercharge your investment.

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What Does An Amazing Property Management Company Do?

By | Agents, brokers, Property Management, real estate, Real Estate Investment

Imagine a world where you never have to worry about finding the right tenants, collecting rent, and getting a plumbing call in the middle of the night on one or many of your investment properties. Well, it is possible with the right property management company. Here are a few things an amazing property management company can do for you...

Market Value

Property managers start by evaluating your property. After performing a detailed inspection of the interior and exterior of your property, which includes taking photos and/or videos of the property, a great property manager can make suggestions for repairs both cosmetic and necessary—repairs that can increase the value of your property and make it more appealing to prospective tenants.

Next, a property manager will seek to determine the fair market rate for rentals. They conduct a comprehensive comparison study of the rentals in your area, to discover the amount of rent that is considered “fair market value” in your area, for your property type and features.

When it is time to search for a new tenant, they will handle the heavy lifting of the leasing process. Whether they show the property individually, list it on the MLS with a lockbox, or some combination of both, a great property manager will market your listing in unique ways to find your ideal renters out of many potential renters.

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Creative Marketing

Carrying a great deal of experience when it comes to marketing, a great property management company can easily design effective ads that will really get perspective tenants attention. Utilizing professional photography and graphic design, a great property manager can prepare print ads, digital ads and network your property with other realtors.

As the calls from prospective tenants start rolling in, they can provide additional information about the property, with a keen sense of how to answer questions you may have had difficulty with on your own. When it is time to show the property to prospective tenants, a great property manager will handle it without hesitation—even during “off” hours like regular business operating times when you may be occupied with other responsibilities.

Tenant Selection

A great property management company is likely already outfitted to present your prospective tenants with application materials that are in line with federal and local housing laws. This means that leasing is sound, safe and secure with a great property manager.

Tenants expect to be required to clear certain verifications in order to be truly eligible to rent from you. Professional property managers know this and are well-prepared to run the necessary background checks to ensure that your prospective tenants are qualified. They will meet with the prospective renters on your behalf and collect the necessary background information to run the verifications.

Leasing

Even if you already have a lease to use, a great property manager is sure to have a lease ready-to-go that is at least as secure and safe as yours, and can set up the lease agreement within all the specific local, state and federal guidelines. They will go over the lease agreement with the tenants to ensure that the terms are well understood—especially addressing the lease due date payment and any fees associated with late payments. Property managers also can ensure that all the instruments have been executed correctly and all signatures are received. When the lease is in place, the property manager will work with your new tenant to secure a move-in date.

Moving In

Great property managers will always seek to perform a comprehensive move-in walkthrough of your property with your new tenants. This is an outstanding way to manage expectations and establish accountability. By making careful notes, a great property manager will learn and share with both parties the condition of the property at the time of move-in. The walkthrough provides an arena for your new tenant to voice concerns and request maintenance on items you may have overlooked or forgotten, while you are well-informed of the condition of your property at the time of the move-in. This can be invaluable in the event of difficulty down the line.

Lease Payment Collection

You can count on your property manager to collect the rent, address late payments and collect late fees on your behalf. In the event things take a turn for the worse, they will even send out demand letters, quit and eviction notices.

Provide Legal Support

Expert property managers are equipped to supply and manage all necessary legal forms and documents for eviction proceedings. They can act as the owner’s representative in court, or work with law enforcement when necessary to remove tenants that are unlawfully occupying property.

In the event of a legal action, your property management company can provide advice or qualified attorney referrals. Great property managers can help the landlord to stay in compliance with all legally binding and necessary activities to include proper documentation.

Financial Service Support

In addition to keeping track of you tenant’s rent collection and security deposit, your property management company can provide accounting services, make payments on your behalf and maintain detailed documentation and expense records. Your monthly income and expense reports will be delivered in the form of performance reports.

Count on your property manager to keep historical financial records for easy access when needed. When it comes to contractors, your property manager will provide tax documents like 1099 forms and other records to ensure ease of tax preparation. You may also find your property manager can give you reliable tax advice about which deductions can be taken.

Work Orders

When it is time for maintenance or a service request, your excellent property manager has a crew of fully-vetted contractors ready to work. They will work with your budgets and take responsibility for the project management just as an expert general contractor would. No rehab or remodeling project is too large or small for an expert property management firm.

As the seasons change in Chicago, the need will arise for landscaping in the spring and summer months, as well as leaf and snow removal in fall and winter, respectively. You can count on your expert property management company to cover you so your tenant stays happy and safe. A 24 hour maintenance phone number provided to your tenant will also work to foster trust and peace of mind.

Moving Out

As with the move-in walkthrough, your property manager will perform a detailed move-out walkthrough inspection of your tenant’s unit, noting damages and necessary repairs. Count on your expert property manager to ensure that your tenant’s security deposit is returned or rightfully applied toward necessary repairs. They will also make sure the keys are returned or the locks changed, and that the unit is deep-cleaned and ready for a new tenant. Marketing begins immediately after an availability date is established.

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These are just some of the services that a property management company can provide. If you need or want additional services, contact your property management company to see what they have to say.

Here at Lofty, we are excited about all the ways we can be of service. Talk to us today and see how we can help you live the life you deserve.

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One Overlooked Issue for Chicago Home Workplaces

By | Agents, brokers, home buyer, home buying, Property Management, Property Managemnt, real estate, Real Estate Investment

For those who might be dubious about flexjobs.com’s contention that 75% of employees “are less distracted at home,” a survey from Atlassian, a developer of team productivity software, offers some common-sense confirmation: “Seventy-six percent prefer to avoid the office when they need to concentrate on an important task.”

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Naturally, the rising tide of Chicago home workers creates a corresponding surge in the need for Chicago home workplaces—areas fully or partially given over to business activity. We have already seen an increase in the interest that prospective buyers are expressing (and Realtor® Magazine predicts that home offices “will become a hot amenity for the long term”).

All this points to at least one wrinkle that hasn’t as yet been given much attention: workplace safety. The requirement for things like smoke detectors, adequate lighting and ventilation, and unobstructed walkways are second nature to human resource professionals—but few Chicago home workers have probably given them much thought. The immediate need for a strong Wi-Fi connection and comfortable seating are more likely to have drawn their attention. Yet, according to the government’s telework.gov website, ensuring workplace safety is the remote worker’s responsibility. Given the number of hours now being spent in Chicago home offices, that is worth treating seriously.

At Lofty Real Estate, it is our job to track the latest ins and outs of the everchanging Chicago home marketplace—and to share them with our clients that are buying, selling, and/or looking for property management for their real estate investment.

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When to List: Controversy in This One-Off Year

When to List: Controversy in This One-Off Year

By | Agents, brokers, home buyer, home buying, real estate

Sometimes, the timing for when to list your Chicago home is pretty much dictated by circumstances. Whether they be personal or professional changes that call for a move, when to list is (as politicians say) "baked in." When to list can't be rescheduled.

When that isn’t the case—when the timing is solely up to you—there are two ways to look at the decision. One of them is controversial.

Controversial: timing by season. Although many commentators do seem to come down on the side of listing for real estate’s busy season, there are reasonable arguments that counter it. Statistics do prove that the majority of transactions are initiated during good weather. During the spring and summer months, when the sun shines the longest, buyers tend to have more optimism (and possibly energy, although that’s debatable). There are definitely more prospective buyers during the peak real estate season—and they’re out in the neighborhoods house-hunting.

Yet from the seller’s point of view, it’s also true that there is more competition from other Chicago homes for sale. The peak season nay-sayers can also argue that prospective buyers who do their house-hunting in poor weather are demonstrably highly motivated—making for fewer looky-loos and more committed prospects.

Non-Controversial: listing when you’re ready. If 2020 has demonstrated anything, it is how ignoring the traditional real estate calendar can sometimes work out nicely. This year, the “peak” for national home sales has taken its sweet time getting here. It has been on its own schedule—one that nobody could have predicted a year ago. What hasn’t been debatable is what knowledgeable financial commentators have long recommended: when your house no longer fits your lifestyle and/or your financial circumstances indicate that a move will be advantageous—that’s the calendar you should pay attention to.

After the sale is completed, in retrospect, the right time to list your home will have been when your ultimate buyer was looking for a house like yours. That might be more likely when more shoppers are active—yet the persistent fact that many sales seem to be finalized toward the end of the year argues otherwise. The truth is, when you are ready to move on, emotionally, and financially, it’s always the right time to list your Chicago home. It’s also the right time to give one of Lofty’s real estate agent a call!

Thinking of listing your home? Give us a shout and learn more.

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Benefits & Drawbacks of Raising Rent

Buying Multi-Units Vs SFH as Investment Properties

By | Agents, home buying, Property Management, real estate, Real Estate Investment

Real estate in Chicago is a pro’s game. The dilemma of making a decision to buy a multi-unit or a single-family home is not strange to most property investors. Placing the merits and demerits side by side, and considering what works best for you and your investment goals is key to making the right decision.

Investing in Chicago real estate requires a solid discernment of the real estate scene. It’s easy to stare at a few numbers and just decide that single-family homes are better than multi-units and vice versa.

To completely figure out what represents a better real estate investment decision, let’s look at the two types of properties. Then we’ll do a compare and contrast and let you be the judge.

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Single-Family Units- Merits of Investing

A single-family home (SFH) is a property with only one family (unit). It’s a multi-unit when there is more than one family or tenants living in different units of the building.

There are many benefits of investing in Chicago real estate. and even more when you go with a single-family unit. Let’s look at these for size.

1. Ease of Selling Off

It’s easier to sell off a single-family home. This, in fact, means that you can quickly make a profit on the sale of a SFH than when your property is multi-units. There is also less stress in finding interested buyers when you’re trying to sell a single home.

 2. Faster Appreciation of Property

Single-family units appreciate quite faster than multi-units. Although the difference is often not so large, it’s not negligible either. The appreciation value is a reason you might want to consider when buying a single home because you’re likely to sell (if you decide to sell it) for a considerably higher price than you purchased it.

This also depends of course, on the duration between when you purchased and when you decide to sell it off.

3. Lesser Tenant Issues

With a single-family home, you’ll get fewer phone calls about maintenance and issues going on at the house. You may also not bother employing the services of a Chicago property manager. Since you have only one family on your property, you can self-manage on your own. Collecting rent monthly will also be easier.

4. Less Strenuous Maintenance

There is usually less wear and tear in single-family house units, (well, except the tenants are out to destroy you). In a single-family home, it’s easier to track damages and ensure the house in great condition.

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Merits of Investing in a Multi-unit

Multi-units are also profitable, with some advantages over single-units. Let’s see the merits here.

1. Better Security with Covering Operation Costs

With a multi-unit, you have better chances of having all the fees covered by your tenants. The rent from multiple tenants will cover operational costs. With more people, and a better security management system in place, you are less likely to have theft or crime issues.

2. Regular Cash flow

With more than one tenant paying rent and bills every month, you have a regular cash flow. With excellent maintenance and tenant welfare, you stand a chance of never having a unit in your house empty for any long period of time.

3. Less Charges from Property Manager

Chicago property managers give discounts on every unit in a multi-unit property. At the end of the day, you’ll pay less fees to your property manager per unit than you would in a SFH (single family housing unit). That’s because the discounts you enjoy on multi-units are not extended to SFH.

4. Larger Pool of Tenants

When it’s time to put a new tenant in one of your units, Chicago brokerage companies can help you do a good and swift job of filling up your multi-unit. It’s easier for them to handle than SFH because more people are interested in renting a unit in a building rather than a single-family house.

Multi-unit Vs Single Family Home

To make an intelligent decision free of sentiments, let’s compare them under the following headings, using cold hard facts:

  • Investment risk
  • Expansion
  • Tenant Issues
  • Cash flow
  • Sale
  • Maintenance
  • Appreciation
  • Renters pool and Brokerage

Investment Risk

Single-family units are sometimes highly risky as a tenant can vacate any time. If this happens and you can’t find someone to replace them immediately, you’re going to bear all the costs of mortgage, taxes, and maintenance all by yourself.

There’s a certain comfort in knowing that with a multi-unit, you’ll always have someone living on your property and the rent will cover the costs of the mortgage, maintenance, utility, and so on.

Expansion

Expanding a single-family unit is easier. With a multi-unit, you’re more or less stuck with the original architecture forever. Except, of course, you’re ready to bear the cost of nearly tearing the building down and starting again.

Tenant Issues

Issues with tenants are more frequent in a multi-unit. Because there are more people living there, there’s a greater possibility of clashes and the need for conflict resolution.

Cash flow

Cash flow in multi-units is more frequent and dependable. If your property is well managed, you’ll hardly find yourself bearing the costs of maintenance by yourself. In single units, you may not have that level of security. It’s only one tenant paying and that’s it.

Sale

It’s easier to get a large pool of buyers for single-family homes than for multi-units. This means you can find more reasonable Chicago brokerage fees with SFH. Multi-units may not attract 100% brokerage since there’s more work in finding your buyers and keeping up with payment of rent.

Maintenance

For SFH, it’s usually higher. As for Multi-unit properties, due to the fact that more people live in your multi-unit property, maintenance costs may also rise. In fact, you’d have to employ the services of a Chicago property management company to help you keep up with this. A good choice would be Lofty property management company.

Appreciation

Appreciation rates in Chicago real estate have been different over the years. Of course, SFH appreciates slightly faster. But in any case, if your multi-unit is well maintained, it can appreciate just as well. Note however that if your SFH’s location is bad, you may run into serious debt.

The verdict: Single Family Home or Multi-unit?

This is not a clear-cut choice. In a busy location, you may want to trust multi-units more. There’s every chance that the units will always be occupied at every point in time.

Before buying a SFH, consider if you will be able to foot the bills of taxes, electricity, mortgage, and the rest in case there’s ever a long duration between when a tenant leaves and when another comes.

In Conclusion

There is no clear-cut winner. Depending on the location of the property, SFH may be a better option. The merits of multi-units are obvious as well, but if tenant issues and maintenance costs are not for you, you may just be better off with SFH. Either ways, there’s always one that’s more suitable in a particular situation.

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Why Buying and Owning Rentals is Always a Good Investment

By | Agents, home buying, Property Management, real estate, Real Estate Investment

Owning a rental is always good; you get paid for being the landlord. It's a really profitable slice of the Chicago real estate investment market. This is mainly because of two things; the first being the steady stream of passive income it provides, and the second being the opportunity to get tax write-offs.

Of course, owning a real estate rental in Chicago is not an easy feat. The rewards are potentially huge only if you have a keen eye for details, proper preparation, and a sound Chicago property management company in charge of your property.

Managing rentals on the Chicago real estate scene can be done all by yourself, but like most people you may get overwhelmed over time. At this point, you can use the services of a Chicago property manager, such Lofty Real Estate Chicago.

Investing in rental properties is always a good idea, once you know the things you need to know, which we will be discussing.

Buying Rentals: Need to Know

Of course, when buying rentals in Chicago, you can either do it yourself or you can use a Chicago brokerage company. Asides from this, it is usually a sound policy to calculate your expected cash flow on the rental property before you purchase it. Think of it as a business; no one goes into a business to make a loss.

For you as a rental owner, the cash flow your property generates is your profit, so to say. Because of this, your cash flow should be at least at break-even point, when you factor in your expenses on the property.

Buying a property with an expected cash flow level that is below the amount you’d spend on expenses such as monthly mortgage payments, depreciation, etc, is not a good idea, and  we do not advise it.

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What are the Advantages of Owning a Rental Property?

There are a lot of advantages of buying and owning a rental property over other forms of investment (we won’t compare, don’t worry), and they are;

1. Diversification of Investment Portfolio

Investment, no matter the amount of probable gains, always involves a risk. Because of the inherent risk in the world of Investment, it is unwise to put all your money into one investment portfolio, especially stocks.  An unforeseen switch in the market dynamics and all your money might be gone with the wind. Owning a rental real estate property helps you mitigate greatly against the inherent risk involved with the investment. Once you have done your due diligence, your rental property will always be a source of income for you – one you can rely on to a very great degree.

2. Getting Tax Write-offs

The tax system favors owning rental properties a lot, and that’s another perk of buying and owning a rental property.  Owning a rental property means you don’t get to pay tax on your rental income. Owning a rental property means there will be depreciation and other property related expenses.  It is a usual practice to deduct the depreciation and other expenses from the federal income tax, and so this leaves the rental income completely free of any deductions.

3. Steady Stream of Passive Income

Owning a rental property is one of the safest ways to earn a steady stream of passive income every month. It’s your job (or your property management’s job) to ensure you keep renters who pay their rent promptly.

The “steady” in the income hinges on a lot of factors including doing a background check for prospective renters, so you can easily weed out those with a history of causing trouble for their landlords.

The best part is that you do not have to get involved in the background checks exercise or even get involved in the day to day running of the property before you get your passive income. You can simply leave your property to a Chicago property management company and focus on other areas of your life, whilst they manage the property and ensure your passive income keeps rolling in.

4. The Chance to Sell at a Premium

The usual industry practice is that you should try to hold your rental property for at least 10 years, but that rule doesn’t always work for every situation.

Owning a rental property in an area that increases the value of your property means you can sell off the property and make a gain on it at any time.

Even if the market dynamics change and the prices of property plummet, you can still rent out your property and make a rental income that will cover the costs of owning the property. You can do this till you’re ready to sell, and you would not lose any money.

Also, real estate market values generally appreciate over time, and the real estate market is usually one of the first to bounce back in case of a recession. So, the chances of losing money on your rental property investment over time are very low.

5. Growing Your Equity

Growing your equity is a goal for everyone, and owning a rental is a good way to do this. It is always good practice to purchase a rental property with a mortgage. Once this is done, you’ll have to start paying up on the mortgage payments, and you can use the rental income to pay for your mortgage.

This would be especially easy if you’ve accurately calculated the amount of cash flow to expect from owning the property. It would basically be as though your tenants are paying your mortgage for you, and over time, your debt will shrink and disappear, and your equity will start to rise steadily.

Conclusion

Buying and owning a rental property is one of the best ways to not just earn stable, passive income, but to also grow equity. By understanding and calculating just how much you can expect with regards to cash flow from the property, you can forecast how long it will take you to pay off your mortgage and start growing your equity.

Ready to invest in rental property? Give us a shout to learn more.

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Leveraging Property to Buy Property: A Full Guide

By | Agents, brokers, home buying, Property Management, Property Managemnt, real estate, Real Estate Investment

Is Leveraging a Good Idea?

The unofficial cardinal rule of investing in real estate is that you invest, or buy real estate with someone else’s money, not yours. This is the basis of leverage in the Chicago real estate investment market; by using someone else’s money to invest in real estate, you are making gains from your lender’s money.

Leverage is a well-known strategy in the Chicago real estate market, and it is the most widely used way to acquire real estate. There is a drawback though; when real estate values rise, it is to your advantage. But when they fall, you are at a disadvantage. This is why it is crucial to do your due diligence about a property when you want to use leverage to acquire it.

Leveraging Your Way to the Second Mortgage

Simply put, a second mortgage is a mortgage taken out when you still have a mortgage in effect on your first property. Doing this is only possible if you have enough equity on your first mortgaged property since a second mortgage is a riskier endeavor than the first.

The usual practice is that your first property is used as collateral for the second mortgage, and most lenders will only agree to a deal if you have enough equity on your first property. This is the big risk with leveraging property to buy the property.

The second mortgage can be used for anything, including using them to service personal expenses.

Types of Second Mortgages

There are basically two types of second mortgages available for use in the Chicago real estate market. They are;

  1. Home Equity Loans
  2. Home Equity Line of Credit (also called HELOC)

1. Home Equity Loans

Home equity loans are a type of second mortgage in which you can borrow a certain amount of money in a lump sum, payable over a period not exceeding 15 years at a fixed rate of interest.

Basically, you are using the amount of your home you own (i.e. the amount of mortgage you’ve already paid back on your home) to back up your credit. If you fail to pay, your house is liable to be foreclosed by the lender.

Home equity loans are best for investors looking to leverage their property to buy a rental property, as rental properties usually require a significant amount of down payment.

2. Home Equity Line of Credit

Popularly called HELOC, this type of second mortgage is different from regular home equity loans in that they are payable with adjustable rates.

HELOCs are the credit cards of second mortgages, and they work in a similar manner; there is a credit pool you can repeatedly draw from, it has a set limit and some lenders even give you an actual credit card. HELOCs have draw periods in which you can draw from the credit pool as you need the money, without having to pay back. This draw period is between 5 to 10 years.

HELOCs also have repayment periods, wherein you pay back all the money you have borrowed at adjustable rates, as mentioned earlier.

Investment Real Estate Deductions You’re Eligible

How Do You Leverage One Property to Buy Another?

There are two ways to do this, put simply. They are;

1. Leverage Rental Property to Buy Another

A rental property is a good investment if bought properly. Managing it yourself might not be easy, which is why we advise that you use a Chicago Property Manager, or a Chicago property management company, such as Lofty Real Estate.

Using your rental property as leverage to get another property is the easier of the two ways of leveraging property to buy another property. This is because the rental income paid by tenants can be used to pay up the mortgage on the rental property and gain some equity.

Using a rental property as leverage for buying another property would involve using the rental property as collateral, as mentioned earlier. A second mortgage would also involve higher interest loans than the first, so you have to be absolutely sure your primary property has enough equity to cover the expenses associated with taking a second mortgage.

2. Leverage Your Primary Residence to Buy Another

Another way of leveraging property to buy property can be this scenario; using the equity on your primary residence to get another mortgage. It can be another house or even a rental property. Doing this will mean your primary residence will be at the mercy of the lender if you default on the second mortgage payments.

Requirements for Leveraging Property to Buy Property

Building up a good level of home equity and a great credit score are central to the success of your chances when taking out a second mortgage.

How to Get A Second Mortgage

1. Know How Much Equity You Have

Knowing how much equity you have will help you make a quick decision on whether or not to go for a second mortgage and leverage your property to buy property. The more equity you have, the more your chances of success when it comes to your application for a second mortgage.

2. Check Your Credit Score

This is also another key part of the process. An excellent credit score will also improve your chances of being approved. If you’re interested in leveraging your primary property to buy another property, then you have to possess a credit score to match.

3. Pick out Your Preferred Second Mortgage Option

There are two options for you here, either you go for a HELOC or a home equity loan. Each option has its own peculiarities and benefits, so be sure to pick one that suits you. If you’re leveraging property to buy another house, going for a HELOC might be best. On the other hand, if you’re leveraging property to buy a rental property, then going for a home equity loan where you’ll get a lump sum might prove to be the better option.

4. Look Around

Once you’ve carried out these three steps, then it’s time for you to find out the options you have with regard to lenders and their rates. Check out the terms of each second mortgage very well, and ensure you don’t sign until you’re convinced it’s the best deal for you.

In Conclusion

Leveraging property to buy property is a smart way of acquiring more property, especially if you have the required equity.  With our guide, you have all you need to know about leveraging property to buy property.

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Popular Interior Design Changes In Chicago Rentals

Popular Interior Design Changes In Chicago Rentals

By | Property Management, Property Managemnt, Real Estate Investment

All owners of rental property share the same main goals: keep vacancy to a minimum while maintaining or increasing property value. Besides a clean space and working appliances, there are several more factors that contribute to an ideal situation for owners and renters alike. Interior design can be a big help and won’t cost too much with a little preparation. Though trends come and go, it is important to be aware of what is popular when designing your property for rental.

Experts Are All Around You

With sites like Pinterest and Houzz, there is no shortage of “expert” advice and influence to be found on the internet. Maybe you have a Facebook friend that has their finger on the pulse of the trends and can help you make some informed decisions. There is a balance between making some popular interior design adjustments to enhance your condo/apartment’s aesthetics and spending countless dollars on a full makeover. Knowing your market can really help to find that balance. With the right touches you can easily enhance your condo and make it much more marketable.

When it comes to upgrading rental property, Owners can also learn a lot by looking at other listings in the area. Making yourself aware of the finishes that renters in your market are looking for will set you up to make the right decisions on your own investment.

Even with the advice of the “experts” on the web, sometimes time just isn’t as plentiful as one may need it to be. Savvy owners turn to Lofty, one of the top property management companies in Chicago. Lofty has apartment management in Chicago down to a science.

Want to increase profits and cut down on your time spent managing your properties? Contact us and we’ll show you how to do just that. We provide free market analysis, consultations and professional photography for all our new clients. We will ensure you never have to worry about renting out your condo again.

Some Tips from Lofty

Through their experience leasing condos in Chicago, the Lofty professionals have refined their list of what does and does not work in rental property design elements.

Here are a few tips you can use as a sort of guide or checklist when you are ready to make some changes for the better:

  • Hire a professional service to clean the apartment really well so you can expect to have your unit returned to you in the same pristine condition it was given.
  • A good place to invest a bit of money is in matching, stainless steel, energy efficient appliances. Otherwise, make sure whatever is there is cleaned like new and operating without issue.
  • Choose interior design materials that are timeless. Hardwoods, natural stone, and stainless steel are all good options.
  • When painting or decorating with wallcovering, opt for neutral colors. A neutral color palette will please the majority of potential applicants.
  • Avoid costly, over-the-top customization as adding too many details may limit the appeal or price you out of the market.
  • Built-in storage and shelving can be a big hit. Bookshelves in a flat wall can add some extra space; closet or cabinet organizers in bathrooms and bedrooms will help maximize storage.
  • Simple bathroom updates like a new mirror, faucet, towel rods and light fixtures make a big difference.
  • Depending on marketplace expectations, blinds—especially wooden blinds— are a great investment as they offer more control and class than a pull-down shade. Remember to instruct tenants on proper operation.

 

Here at Lofty, we provide free market analysis and consultations. We would be happy to come out and take a look at your space to help you determine what interior design touches can help you get more income out of your rental. The right interior design elements will get your property rented for top dollar and keep it rented. We want your time spent where it should be, enjoying life.

 

Speak with one of our experts to find out how we can supercharge your investment.

 

 

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Chicago’s Real Estate Market in 2020

By | Agents, Agents, Brokers, Property Management, Real Estate Investment, brokers, home buyer, home buying, real estate

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If you’re planning to sell a home in the area, you might need to pack your patience. Recent data shows that Chicago is one of the “slowest” housing markets among the major metros when based on median “days on market.”

Despite losing residents at a high rate, Chicago is still America’s third largest city and the economic driver of the Midwest. Although there is not a negative impact of buying a house in 2019 versus 2020, it is strongly advised by experts to purchase a house next year. In 2020, the largest group of Millennials will turn 30, which will be good news for an industry that may need it.

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The National Association of Realtors’ annual home-buyer profile has recorded an average home-buying age of 30 that has stood for decades.

While young people have flocked Downtown, bringing with them corporations seeking skilled workers, Millennials will likely turn back to the suburbs when it comes time to buy. But because so many jobs have moved from the suburbs to Downtown, Millennials will likely look for housing in inner-collar suburbs that have urban amenities like public transportation and walkability.

 

The year 2020: where inflation and financing qualification could hurt prospective buyers. According to Zillow, rising mortgage rates are encouraging homeowners to stay put and discouraging would-be buyers.

Higher interest rates should eventually slow the intense pace of home value appreciation that we have seen over the past few years, a welcome relief for hopeful buyers. Overall, home prices aren’t expected to grow much, and market crashes are highly unlikely. That should make it a safer purchase for buyers and more difficult for sellers to get the best price possible.

 

 

 

 

How to prepare for the next 2yrs in Real Estate

By | Agents, brokers

As 2019 revs up, we are entering into a new phase of real estate. It’s important for real estate brokers, property owners and investors to know where the market is headed in the coming years. Companies are now beginning to leverage new technologies like virtual reality and machine learning to work smarter and sell like never before. To prepare, we’ve outlined our predictions on the upcoming trends and changes that will forever change the future of the real estate industry.

Technology

The real estate industry has gone years without major disruption by technology. Established systems and processes have remained consistent and even outdated. Recently,  $2.7 billion was invested in real estate technology a month by month increase of 132%. This investment in technology has the ability to alter the landscape on how agents are selling and how buyers are searching and buying their ideal homes. Technology will help you reach thousands of more customers while also giving you tools to show homes like never before.

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The buyer

The real estate buyer is now more informed than ever. Buyers now search online to get better insight into the types of properties they’re interested in as well as the neighborhoods. They can also see a home’s estimated value and use tools that tell them if it’s a good investment or not. The buyer will become more independent of the agent which will result in a different sales process all together. Buyers will even be able to get more information about their agent from online rating platforms which will force agents to build a positive online presence if they want new business from online search.

Virtual Reality

The latest trend of VR will soon hit the real estate market.  Buyers will begin to use VR technology to “view” homes without ever having to step foot inside one. This will change the process of open houses. Sellers can even stage their homes using VR. This will help them cut the cost of staging while begin able to show the potential of a home using updated decor. As an agent, it’s important to familiarize yourself with VR to stay ahead of the trend and ultimately save yourself valuable time and money.

Millennials

According to Danielle Hale, the chief economist at Realtor.com, “Millennials will continue to make up the largest segment of buyers in 2019, accounting for 45% of mortgages, compared to 17% of Boomers, and 37% of Gen Xers.” There will be a surge in millennial demand which will change the market to adjust to the needs of millennials. As an agent, it’s important to start researching not only how millennials will buy, but what they are looking for in their first home. Get to know the future buyers and how they navigate buying a home. We’ve compiled a list of tips on our predictions for how millenials will bring their preferences to the market.

  • Online. For millennials, all searches start online. As an agent, you’ll need to create a powerful online presence for yourself and for your listings. Make the extra effort to invest in good photos and a well designed website.
  • Quality over size. Millennials have shown that they are more concerned about the quality of properties over the size. They prefer open spaces with lots of usable space.
  • Location. Make sure to highlight the location of your properties. Even if you think a home isn’t in the most desirable location, get creative and list some notable local spots close by.
  • Low-maintenance. We live in a day where Amazon Prime, Grubhub and Uber make life easier while saving millennials their valuable time. Homes with energy efficient and smart appliances are more appealing.
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At Lofty, we pride ourselves on keeping our agents ahead of the curve through constant proactive research and learning. 2019 offers lots of potential for agents who prepare for the industry changes and use them to their advantage.

Wondering if a switch might be right for you? Give us a shout and learn more.

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Top 8 Ways to Make a Great First Impression

By | Agents, brokers, first impression, real estate

You've probably heard time and time again the importance of first impressions in career development. In real estate, first impressions are so vital that they can make or break your career and reputation. The customer experience you provide is the one thing in this industry that you have complete control over. Technology will never compare to the human interaction and the value you can bring to the home buying/selling experience.

Prepare

If you have the opportunity to have a call before meeting a client, ask a few quick questions that can give you insights into who they are and what they are looking for. Their answers will help you better prepare for the first in-person meeting. Before your first meeting with potential clients, conduct some brief research on the person you’ll be meeting. With LinkedIn, Facebook, and Instagram you can determine their career and personal interests with a few clicks. Also, it’s not uncommon, that you will find mutual friends which are great for a conversation starter. If they’ve already reached out to you with some information, make sure that you go back and re-read so that you’re prepared and not asking questions that they’ve already given you the answers to. If you’ve had a previous phone call with them, refer to your notes and show that you are an active listener. Try to prepare at least three talking points that you think are important to your client. Top real estate agents never come to meetings empty-handed. Print out ideas, suggestions, information about sites and pricing. This shows you are the expert in the industry and are taking the lead. Without preparation, you can come off as unorganized and unprofessional.

Appearance is also extremely important for first impressions. Dress professional, clean, and polished. Don’t overdo your look with flashy jewelry or accessories that can be distracting. Avoid the fancy attire, and stay true to you. It’s also important to dress for the market. Don’t wear a black suit and tie or a gown to show a beach house.

If clients are coming to your office, create a clean and organized environment that also has character. Local artwork is a great way to get away from the sterile office stigma.

The in-person meeting

It’s game time! You’ve done your prep work and you’re now ready to meet with your client for the first time! Be positive, confident and remember that you are the expert. Always arrive at the location early, because showing up late is a great way to ruin any first impression. Introduce yourself and thank them for taking the time out of their day to meet with you.

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Body language

Some may argue that body language can have more power than words. Try to walk with your chest high and practice sitting up straight without crossing your arms. Be completely open towards them and refrain from closing yourself off.

Build rapport/common ground

Finding common ground is a great way to start off on a positive note. Common ground is something that you both can relate to and can connect on. It could be anything from sports teams, to attending the same college, to kids. This is where your social media research will come in handy! The more information you have on someone, the easier it is to make that initial connection.

Ask the right questions 

By now, you should already know what questions you want to ask your client to ensure that you walk away from the consultation with all the information you need to immediately get started helping them and so that they feel as if you’ve proactively done your part to help them.

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Active listening

If you’re asking the right questions that don’t always end with a yes or no answer, you should be getting your clients to speak with depth on what they need/want. The power of active listening has a positive impact on people. Really listening to what they’re saying and engaging lets them know that you understand them and want to know more. People love talking about themselves and your thought-provoking questions will help you find out more about them on a deeper, mutually beneficial level. Try not to look at your phone or computer unless you are showing them something.

Show how you stand out from the rest

Now that you’ve built rapport and connected with your clients, it’s time to show them your abilities as an agent and the unique experience you bring to the table. Introduce why you’re passionate about real estate and share your background. Highlight your credentials and go into some detail on the markets you’re familiar with and the technology you use to make the buying/selling process easier for them. Clients will pay more for an agent that offers an experience that makes their life easier.

Follow Up 

You should follow up with them almost immediately with a thank you note and outline of next steps. If possible, put in any extra work you can to show that you go above and beyond for your clients. For example, stop by the neighborhood they’re interested in, take pictures and send to them. Anything you can do that shows how you take customer service to the next level is always appreciated.

Great first impressions are a sure way to win more clients and keep them happy. Don’t forget that over 60% of business each year comes from the people you know, past clients, and referrals. One great first impression can lead to countless future clients.

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What To Expect Throughout The Buying Process

By | Agents, closing on a home, home buyer, home buying

Whether it’s your client’s first home, or they’ve been through this process before, every experience is different. However, top real estate agents know the core elements of what to expect during a buying process.

Determine housing needs

In order to deliver the best service to your clients and make the home buying process as enjoyable as possible, it’s important that you get to know them very well. Ask the right questions to find out their motives for buying, what they’re looking for, and what they truly need to be happy in their new home. This will not only help you find them homes to show, but it will also help you tailor your efforts to their needs and wants and create a trusting relationship.

Set a clear budget

It’s important for your clients to know their numbers. As an agent, you never want to put your client in a position of buying a home that they can’t afford and vice versa. You want to be able to show them all the options for homes that they can afford. Show them how to determine the cost of homes they can look at by accessing their financial situation and taking into consideration their current debt and bills etc. If they haven’t already, make sure they are pre-approved for a mortgage.

Begin the home search

Once all the prep work is done and you have a clear understanding of your client’s needs and expectations, let the home search begin! While seeing homes, take note of what they love and what they hate. This will help you narrow down the homes you show in hopes of finding the right home, faster.  Top real estate agents say that their client will know within the first 30 seconds of entering a property if they’re interested or not. Pay attention to your clients during those critical moments. If clients are interested in a certain property, make the extra effort to do repeat tours at different times of the day so they know what the neighborhood is like at night, and they can see the lighting at peak daytime. For pre-construction homes, check the floor plans and get to know the reputation of the developer.

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The offer

Use your expertise as a real estate agent to guide your clients in negotiating a fair offer that they’re happy with and is comparable to homes in the same neighborhood.

Escrow

The hardest parts are over! The offer was accepted and your clients are ready to start getting excited. The home is now in escrow, the period of time it takes to complete all remaining steps in the home buying process.

Home inspection

It’s common for offers to be contingent on a home inspection of the property to ensure there are no signs of structural damage or to take note of things that may need fixing. As a real estate agent, you should have developed trusted contacts who you can refer to your clients to conduct the home inspection. Work with them to schedule the inspection within a few days of the offer being accepted by the seller. Keep them well informed during this process and review the inspection in person with them if possible. Explain to them the power behind the contingency and how it protects them by giving them a chance to renegotiate or withdraw their offer without penalty if the inspection finds any substantial damage. Also, review with them if there’s anything that they want to ask the seller to fix before closing. Once everything is agreed upon, you will do a walk-through with your clients as one last chance to confirm any repairs that were requested. Make sure the seller / previous owner has vacated. If you or your client does find an issue, you’ll need to bring it up to the sellers as soon as possible.

Closing

To avoid any delays, it’s extremely important to properly prepare your clients on what to bring and what to expect during closing. Remind your clients that they must bring proof of homeowners insurance, a copy of the contract, home inspection reports, government-issued photo ID

and the down payment. Make sure that you explain that a personal check will not work and it has to be a wire transfer or a cashier’s check. It’s also common for most lenders to require a title search of public property records to make sure there aren’t issues with transferring the property to your client’s name. There will be lots going on that day and lots of signatures. Set the correct expectations for your client, but also let them know that it’s not uncommon for things to go wrong like a missing document or a misspelled name. As a real estate agent, take all precautionary measures to make sure everyone is prepared and the day goes by as painless as possible.

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How To Write A Killer Property Description

By | Agents, how to, Photography, property descriptions

If you’re in the real estate industry, you’ve probably already experienced the power behind compelling content. Professional photos receive more clicks and great property descriptions can help sell a home faster. Writing a killer property description is also a great way to get creative and have fun with your listings while also creating clear communication that sets the proper expectations for all potential buyers.

Stand out

Many real estate agents think that they need to begin writing their property listings like everyone else. Trying to fit in is one of the worst things you can do when marketing your listing. Making your property sound average and repetitive is an easy way to be forgotten by your reader. Try to think outside of the box and think about your potential buyer. Who are they and what would best resonate with them?

Structure and Plan

To make sure that your listings include all the necessary information and call-to-action without rambling, make sure to structure and plan your listing before you begin to write. Ask any journalist about the hardest, yet most vital part of writing and they’ll tell you it’s creating the headline. It’s the one chance you have to grab the reader’s attention, set the expectation, and compel them to learn more. This first impression has to be short, yet engaging enough to attract the attention of the already distracted reader.  Once readers click on your headline you then present them with an opening statement. This can be a sentence or two and should inform readers on what they are about to see and set expectations. The opening sentence gives readers a reason to keep reading and entices them to learn more. For example, “Come see this charming ranch complete with panoramic views of mountains and only steps from a quaint downtown.” Now onto the property features. This is your chance to get creative and really highlight this home through words. Most property ads are written like “New paint, backyard pool, 1 large master bedroom, new garage door.” To stand out and make it interesting for your reader, you’ll want to tell a story. “You’ll love this 4 bedroom walk-up, perfectly placed in Chicago’s hottest neighborhood. Enjoy the stunning views of State Street while still having the option to escape to the backyard oasis complete with greenery and privacy.” This paints a better picture for the reader and becomes a more attractive way of listing out the house features. Don’t forget to include all the property upgrades. Top real estate agents will tell you that buyers love when homes have recent upgrades. It also makes potential buyers feel like the previous homeowner really took care in keeping the home up to date. While it’s important to paint a picture, try not to get too specific. However, there is a fine line between telling a story, and over exaggerating features to the point where it sounds like you’re lying. If readers detect anything deceptive, you could lose their attention forever.

Promotion

Another great way to step up a property description is to add a promotion (if you can.) Having a promotion can be as simple as stating “For a limited time, offering a small discount from the listing price.” This will be a statement that influences your call-to-action, which should follow next. Call-to-action statements are a way to summarize your listing and tell your readers what to do next. If possible, include a sense of urgency to show that this property could go quickly if they don’t act fast.

As you write more property descriptions, keep in mind of best practices but also take note of what works best for you and your clientele. Recently, Zillow conducted a study and found that around 250 words is the sweet spot for listing descriptions. Strategically use those 250 words to tell the story of your listing and the neighborhood. Be sure to spell check, grammar check, and don’t overuse trendy lingo! It’s important to make sure you appeal to all ages and demographics.

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Mortgage Interest On The Rise, Why You Should Buy Now

By | Agents

For years, interest rates have been at historic lows since 2008. By now, you’ve probably heard from either the media or a real estate agent on how the Fed is raising interest rates. For example, the average rate of a 30-year fixed rate mortgage is around 4.40%, which is the highest rate since April 2014. This upward pressure comes at a time we’re all familiar with, home buying season, which typically lasts spring through early fall. If you ask any real estate agent or market expert, they will all agree on telling you that now is the time to buy. Not only will the higher rates get in potential home buyers way, but also the limited housing supply could allow matters to get worse for those who wait to buy.

The Federal Funds Rate

The Federal Reserve controls the Federal Funds rate which is the interest rate in which banks lend to each other.  According to Financial Samurai, “If a bank has a surplus over their minimum reserve requirement ratio, they can lend money at the effective Federal Funds rate to other banks with a deficit and vice versa. You can see how an effective Fed Funds rate of only 0.15% would induce a lot more interbank borrowing in order to re-lend to consumers and businesses and keep the economy liquid. This is exactly what the Federal Reserve hoped for once they started lowering interest rates in September 2007 as home prices began to collapse.”

The Impact

Although you may not understand how the growing interest rates could directly affect you, they do have potential to impact you in a meaningful way. Mortgage rates are generally known to move in the direction that the Fed Funds rates move. Aside from rising mortgage rates, housing prices are also on the rise. Home prices nationwide are up 48% since 2011, according to the National Association of Realtors. The prices for single-family homes hit record highs in 114 of 177 major metropolitan areas that were tracked. Throughout this time, incomes have only risen 15%.  Real estate agents also advise taking advantage of the low rates by locking in an interest rate now with a 15-30 year fixed rate mortgage if you plan to stay in the home for a long time.

This year’s spring homebuying season has been off to a relatively slow start. According to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey,  mortgage applications have dropped 3.3 percent week over week. Many believe that this is a result of the growing lack of affordable housing.

Nationally, the collective data shows that interest rates and home prices will continue to trend up. However, you do have time to get your finances in order if you feel like you’re not truly prepared to buy. However, to take advantage of the optimum benefits, it’s best to buy sooner than later.

While there are positives and negatives to the rising and falling interest rates, the bottom line depends on what your financial goals are. For those who’ve been thinking of buying a home, it’s best to stop putting it off and take action to buy now before rates get too high.  Many experts say that if people begin to take advantage of the current lower rates, buying homes can lead to more home building, construction, and decor sales and even boost our economy in a unique way.

Next Steps

If you haven’t started already, immediately begin doing your research on homes and neighborhoods where you’re interested in moving.  Look for housing trends in certain areas and take note of the average home listing prices.

The top real estate agents and industry experts recommend that people look for homes that cost around 3 – 5 times their annual household income while planning to make a downpayment of 20% of the home price.

When you think you’re ready to start looking for a home, it’s best to get pre-qualified for a home so you know exactly how much you’re able to spend. Once you provide financial information to your mortgage banker, you can review the price range of homes that you should be looking for. As always, we’re available to support you and answer your questions whenever you may need us.

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Real Estate Agent Tax Tips: What You Should Know

By | Agents

Real estate agents know that this career often requires investing much of your own time and personal finances before seeing the fruits of your labor. Tax season can be rough, but if you stay on top of your finances, document all important deductions, and understand your true profit by year end, you’ll appreciate the savings. It’s extremely important to set up a basic filing system to organize all paper receipts, income documents, checks and credit card statements for all transactions that relate to the business you conduct. It’s also important to keep receipts for property that depreciates for as long as you own them. Documenting all of your eligible tax deductions has the potential to help you save thousands of dollars.

Usually, real estate agents receive a 1099 tax form and receive compensation as an independent contractor, meaning that most agents are considered self-employed. Therefore, a schedule C (profit or loss from business) must be filed. Agents can write off deductions directly from income but may be subject to Self-Employment Tax on profits.

real estate agent tax deductions

Learn about The PATH ACT

The Protecting Americans from Tax Hikes (PATH) Act provides real estate agents and brokers relief when it comes to business-related purchases by changing the IRS Section 179 deduction. The PATH Act was established in 2015 and allows you to deduct all or a greater portion of your business related purchases which translates into bigger savings on taxes. For example, since agents use their cars for showings, you can write off up to $25,000 for the price of a new car the year you purchased it.

Important tax deductions to remember

Aside from large purchases, there are minor costs that add up over the year that can also be deducted. Some may not even be apart of your every day business, but are still allowed. Make sure that you are only deducting things that you pay for personally and not your brokerage.

Take advantage of these common real estate agent and broker deductions:

-Marketing and sales assets. Open house signs, flyers, cards, mailers etc. You can also deduct marketing expenses like website development and maintenance and even the money that you paid to have the assets designed.

-Marketing and advertising spend. This includes all money you put towards digital advertising.

-Internet and phone. Any bill that you pay for and are not reimbursed can be written off.

-Real estate training. Coaching, and education costs including books bought for personal use.

-Real estate licensing. Any renewal fees, licensing fees, association dues, and MLS dues.

-Desk fees.

-Transportation. Automobile maintenance repairs, gas, mileage, auto insurance, parking and new car purchase or lease costs. Tolls, ravel airfare, lodging, meals during real estate education or conducting business with clients. Taxi and uber fare when seeing clients is also included.

-Home office costs.

– Gifts ($25 deduction limit)  & entertainment. Entertaining and client thank you’s can be a large expense of any successful real estate agent. However, be careful here, as you may have a hard time explaining a $2,000 dinner at the Ritz. In most cases, you are able to write off half.

-Cold callers. Sales assistants and virtual assistants also qualify for this deduction. If their earnings come out of your pocket, you can deduct them.

-Prospecting lists. This is often overlooked by agents, but can be deducted if you purchase them using your own money and not by the brokerage or firm.

-Commissions paid.  Absolutely do not forget to list all of the commissions you pay to other agents or brokers. Top real estate agents say that commissions paid on split listings or other arrangements can add up to by the biggest tax deduction.

-Retirement plan contribution. If you haven’t already began this process, you should!

-Insurance. General business insurance and E&O Insurance is deductible. You must have your own policy and cannot be covered by your brokerage, unless it’s covered by desk fees, then it’s deductible.

-Legal services. This includes all lawyer fees that you’ve accumulated from your business over the year.

-Franchise fees.

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Keep in mind that to qualify as deductible, real estate business expenses must be: ordinary and necessary, directly related to your business and a reasonable amount. IRS Publications 463 and 535 can help you determine whether a specific expense is tax deductible (SOURCE: TURBOTAX.COM). 

Be smart about how you claim your deductions and make sure you have the correct documentation to back them. Use your calendar to remind yourself to file receipts or use an app to take a picture of everything and digitally organize it. While there are many ways to cut corners in the tax system, the potential harm outweighs the benefit and may ruin your career.  Stay organized throughout the entire year so that when April rolls around, your prepared to receive the best outcome for you and your business.

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How to Maximize Your Realtor Network

By | Agents

Every real estate training class, article, webinar, or book will introduce to you the power of effective networking in real estate. Having an expansive list of leads and potential clients puts you ahead of the game and gives you the upper hand on where to look for your next deal. Many agents turn to family, friends, and local events to look for clients to add to their pipeline and begin marketing to. However, many agents have not successfully leveraged their own network of realtors that they’ve met or worked with over the years. Your industry peers are equally as important to leverage as potential clients.

Learn From Each Other

The real estate industry is continuously evolving with new ways of marketing, new laws, and changing best practices. Take the time and make an effort to connect with realtors who you admire and look up to. Offer to take them out to lunch or coffee and pick their brain on industry best practices or helpful tools and systems they’ve learned over the years. Top real estate agents share that at one time in their career, they’ve asked someone to mentor to them. By connecting the new with the experienced, both parties end up reaping the rewards. When established properly,  agents can learn news skills under the direction and advice of a seasoned expert and vice versa, the seasoned expert can learn new skills and tools from the person they are mentoring.

Beyond business objectives, it’s important to leverage your network for social well-being purposes. Taking the time to get together and talk for reasons that aren’t related to strictly business is a great way to decompress while strengthening your peer relationships. Sometimes the feeling of competition can put a strain on relationships with your local realtors.

top realtors in Chicago

Collaborate on Marketing

Digital marketing has now become the #1 way real estate agents receive and manage inbound leads. With the power of social media advertising, realtors can target potential buyers and effectively walk them through the funnel. An important aspect in marketing, is marketing yourself! Pair up with other agents who you admire and take a cross marketing approach. You can each leverage each other’s online network to double your exposure. Create a plan on how together, you can establish yourselves as thought leaders in the industry and both add content that is engaging and beneficial for the viewer. Or if one of you is having a hard time getting traction on a property, having other realtors share with their network is a great way to get new exposure. Top real estate agents have also began to group together to create successful podcasts on industry news.

Agents, Brokers, Property Managemnt, Real Estate Investment

Refer Leads to Each Other

Referring leads and clients to other realtors can sometimes be a tough line to cross and make many realtors stay away from the thought altogether. Other realtors find it valuable in helping them leverage their network and strengthen both their peer and client relations. In real estate, there are times when you have done your best with a client, but have been unable to help them any further. Although, it may hurt to give them up, it’s important to place them in good hands  and even help out your industry peers. They may do the same for you one day. However, it is extremely important to asses the situation and only make the referral if you think the client and realtor are a good fit. If things go South between them, you don’t want any responsibility or damage to your reputation. Really be sure to have complete clarity on what the client wants and give detailed notes to the new realtor to best prepare them for the relationship.

Industry Events

Networking within your industry means more than meeting with other agents. Industry networking events are a great way to meet vendors, developers, and designers, who are all important to engage with to diversify your experience and knowledge. Top real estate agents say that building a solid list of vendors is great for client relationships. You can offer solutions instead of sending them to look online, and of course it helps establish trust and commitment with clients which leads to great referrals. Pro tip: A great home inspector is a powerful tool to help you limit your liability and build trust with your network.

Many realtors let the fear of competition get in the way of leveraging their most powerful network; their peer realtors. These fellow industry professionals provide valuable insight and opportunities on new market information and innovations that you may be unaware of.  Working together can also help with your digital content strategy and broaden your online reach. If you’ve been slacking on building your realtor network, use LinkedIn to connect with new peers, join online groups, and learn about local real estate events.

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What is a 100% Commission Real Estate Brokerage?

By | Agents

You’ve completed all necessary certifications and you’ve passed the test. You are officially a real estate agent. You’re hungry, passionate, and ready to dive into your career with full force. Your next step in becoming a licensed real estate agent is selecting a broker to sponsor you. Even though, it may feel as if you work for yourself, you by law need to work on behalf of a broker. This decision can affect the direction of your career, determine your growth rate, and ultimately; your paycheck.

Most brokerages are consistently hiring agents to fill their desks. However, there are important differences among companies in structure, operations, and ethic. Make sure to take the time to find the brokerage that is the best fit for you and will ultimately be the right place for your growing business.

The Traditional Model

In traditional real estate business transactions, a seller would contract to have their property listed for an agreed upon percentage of the selling price. The listing brokerage lists the property in the MLS and shares that commission with any MLS broker member that brings a buyer that completes the purchase. That is considered split #1. Each of the brokers would then split their portion of the commission with the agents involved as split #2.

Until now, the typical real estate brokerage would pay their agents a percentage of the total commissions.  In many cases, a majority of that commission ( sometimes even up to 50%) would go the brokerage in exchange for allowing that agent to work under the brokerage license. The traditional brokerage would provide the agent with some training, leads, and access to MLS information.

This traditional brokerage model may no longer make sense. With the booming digital age, agents have direct access to all data, communication, and contracts; and can support themselves and their clients without much help from the brokerage.

The 100% Commission Model

The traditional model has all changed with the introduction of the 100% commission real estate brokerage. This new concept allows real estate agents the ability to keep full commission value without any splitting.  This makes it even more convenient for agents to manage all transaction documents and truly be in charge of their own finances. Not only do you keep your full commission, allowing you to quickly ramp up your career, but also 100% brokerages have no sales quotas to follow and actually support you in however they can to help you build your book and close faster and more effectively.  This allows agents to set their own base and determine their own personal goals that are best for them and their career.

100% commission model brokerages are also offering marketing programs that can generate leads at a lower cost than if the agent was to do it alone. Instead of letting sales quotas cause unnecessary competition between real estate agents, they help foster relationships between agents that will benefit both of their careers.  

Making Your Choice

When making a decision to choose a 100% commission brokerage in Chicago, compare what services come with what fees. Some brokerages offer digital tools necessary for agents to be competitive in their market. Even if you are keeping 100% of  your commission, you need the tools, support and training to help you sell. The 100% model will continue to evolve in favor of the agent since there is no doubt a paradigm shift occurring.

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How To Add The Most Value To A Listing For The Least Cost

By | Agents

While the real estate market has had its changes over the years, there is one thing that most agents can agree on: it takes effort, skill, and strategy to sell a home. Taking advantage of easy home renovations could add value to your home and increase ROI. Not all sellers may be willing to spend the time and money for renovations, so it’s also important to come with a plan to support your claim. The recommendations below come from top realtors in Chicago and have been proven to add the most value to a home, without an intimidating budget.

top kitchen remodels to sell home in Chicago

Budget-Friendly Kitchen Remodeling.

The best real estate training and top agents will remind you that kitchens and bathrooms are key factors on how fast a home will sell. There’s an old saying that everyone always congregates in the kitchen, so naturally people want an impressive one. An old kitchen can be negative to buyers, yet there are many ways to refresh and redo a kitchen to wow potential buyers. Replace black and white appliances with stainless steel and switch out old laminate countertops for granite. (Chose colors that appeal to all home buyers) There are plenty of affordable options for granite and you can find discounted appliances at outlets. Another key feature to any kitchen is the sink.  Upgrading an old sink can really grab the focus of a buyer.

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Refine Your Flooring.

Similar to paint, flooring can also change the look and feel of a home. Top realtor have confirmed that hardwood is always the most appealing to buyers. If you do happen to have hardwood floors in a home, make sure to refinish them if they’re beginning to look dull. A refinish can turn old floors new again and brighten up any room. If the home does not have hardwood floors, there are many high quality laminate options that work beautifully and are affordable. Carpeting may be acceptable in bedrooms if it’s good quality. However, many buyers are beginning to turn away from carpeting altogether. If your sellers are thinking about replacing the carpeting altogether, you may want to opt for hardwood, or basic snap-to hardwood instead.

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Upgrade Fixtures.

Upgrading a home’s fixtures is an easy way to create a modern look at a low price. From lighting fixtures to new hardware, you can chose which fixtures you think have the most impact and go from there. Be sure to make sure that fixtures match to avoid a randomized style look.

Curb Appeal.

The exterior of a home is the first impression on potential buyers. Manicuring the front yard with flowers, new mulch, and a fresh coat of paint on shutters is a great way to enhance your curb appeal on a budget. Make sure the porch is clean and organized and, if it’s a selling point, add lighting to draw more attention to it. If the siding on your home looks dirty or old, take time to power wash and refresh the exterior.

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Top 4 Ways To Tap Your Network For Business

By | Agents

The first thing that any sales or business class teaches is that building authentic relationships is important in any and all business. In real estate, agents are helping their clients with life decisions that may not only impact them financially, but personally and mentally as well. Some clients may be starting a new chapter in their life, while others may be going through enormous life changes. You may be interacting with your clients at their most vulnerable state in life, which forms a connection, unlike many other industries. The relationships that you build with all clients, family, and friends will have an effect on your business. Leveraging your personal and professional network to help build your business is one skill that top realtors live by. The best real estate training will teach you how to use these networks to expand your client base. However, activating your network is not something that can happen overnight, but a process that can take months and even years.

top realtors

Value All Your Relationships

When thinking about your relationships, top realtors recommend immediately starting to add value with every person you interact with.  Examples:

  • Helping co-workers and other agents with resources that you think they’d find helpful
  • Taking friends or family members out to coffee or lunch for the simple sake of “catching up”
  • Sending Christmas cards to past clients and thank you notes to everyone who has greatly helped you this year
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Provide Your Network With The Right Information.

We all have those family and friends who ask what you do every time they see you. Sometimes showing your network what you do can leave a better impression. Always be sure to share your branded web page and social media profiles with your network. Take the time to digitally connect with everyone you know personally and professionally. When creating your content, make sure that it is appealing to a general audience so that more people engage and potentially share your information with their networks. Brand yourself professionally, yet keep the same character and personality that your network knows and loves. Be sure to regularly update your profiles to reflect your recent real estate work and progress so those you may not see often are still updated on your recent business. Avoid posting too much yet post enough to show reminders that you’re ready and willing to help your network buy or sell. Another way to engage them beyond social media is to add them to a once a month email list. Use that email to showcase some fun statistics, gorgeous homes, or honorable achievements on your part. Email newsletters are a great way to get content to your network that they can then forward on.

Successful real estate agents have recommended giving your close family and friends business cards for them to hand out to potential clients. Those who work in industries where they are in contact with many people a day (Uber drivers, hair stylists, bartenders etc.)  are more likely to have personal conversations with people who could be potential clients. If they do happen to produce a referral turned client, make sure to thank them in a meaningful way and timely manner.

networking in real estate

Know When To Leverage Your Network.

Timing is everything. There may never be a perfect moment to ask for leads, referrals, or favors from your network, but knowing these tips may help you choose the best moment for you. There are 3 questions you can ask yourself to help you decide:

  1. Is there an authentic amount of trust built within the relationship?
  2. Are you able to clearly communicate the message in a way that is respectful yet simple?
  3. Is the timing right on their end or do they seem stressed/overwhelmed and preoccupied?

Keep up with your network’s milestones and accomplishments. Social media is a great way to keep tabs on people who you may not talk to every day. For example, use LinkedIn to monitor when people get new jobs. You can strike up a conversation by congratulating them on the transition while seeking out more details on their life. Or use Facebook to monitor life events that may soon follow with a home purchase. Engagements, weddings, babies, and graduation are all great opportunities to follow up with people to learn more.

Ask.

The average person moves every 7-10 years. It’s almost a guarantee that everyone in your network knows someone who is in the process of trying to buy or sell their home. The only thing between you and these potential clients is the ask. After building trust, and deciding on the right time, be confident and ask the simple question. If you don’t ask, the answer is already no. Be clear and specific about what you want. Asking “Know anyone wanting to buy or sell their home?” will receive a completely different answer than “Can you please give me the contact information for anyone you know in the Chicago area who is serious about buying or selling a home?”. Being direct with detail can help avoid confusing follow up conversations or having to ask your contact twice.  Make sure to also be intentional with your requests. Instead of asking 60 people for referrals at once, ask 6 people who you think can provide you with the quality leads you are looking for.

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Creative Ways To Market Your Hard-To-Sell Listing

By | Agents

As a real estate agent, you already know the importance of being creative in marketing your listings. In an industry where much of real estate training teaches you the same marketing tactics as other agents, it’s necessary to always stay educated on new marketing tools to help you differentiate yourself and more importantly; sell your homes faster.

When it comes to that “hard sell”, we know the struggle of watching the days go by with no inquiries or showings. Or maybe you’re having showings, but no offers. Sometimes you’ve exhausted all your resources and marketing tools, and you just need something new to stand out or get the ball rolling. Below, we’ve outlined some creative ways to market that “hard-to-sell” listing that you’ve been worried about for weeks.

top realtors

Show Off The Neighborhood.

In many cases, the neighborhood itself is enough to sell a home. Capitalizing on areas that offer great amenities and/or local flavor is a great selling tactic used by top real estate agents. Potential buyers may not be familiar with the neighborhood and may have a difficult time picturing their life there. Go out of your way to plan a night out at a local favorite. Pick a street that is lively, but safe, and a restaurant that you know will delight. You can use Opentable to make a reservation and even schedule an Uber to pick them up and drop them off. This takes out the frustration of parking or driving in an area that is unknown to them. As passengers, it also allows them to see the neighborhood. The marketing angle here is to create an experience that not only allows them to explore the neighborhood, but it also shows the buyers that you care about more than just selling your listing.

sell real estate

Look For Investors.

Leverage the internet to find people who may want to buy your property as an investment. With Google, you can find a list of all the properties in your area that sold for cash in the past 1-2 years. Use the list to create an email campaign on Mailchimp and let these people know that you have some properties they may be interested in.

You can also google “We Buy Homes” and the city you’re located in to find property buyers in your area. Similarly, using social media, you can search “Real Estate Investor” on Facebook, LinkedIn, and twitter to search people who have listed that as their job title.

how to market your hard to sell listing in Chicago

Create An Awesome Video.

87% of online marketers now use video to convert their audiences into paying customers. Videos on social media generate 12oo% more shares than text and images together! You can create a video tour with your narration allowing you to touch on all the value points of the house while adding your personal touch to incite emotional reaction within the viewer. If a professional videographer is not in your budget, there are plenty of real estate video apps that will allow you to create a customized video with professional quality features. Get creative and try to tell a story that people want to watch.

Hold An Open House Party.

These days it may take a little more than fresh baked cookies and flowers to win an open house. If your property has great entertaining space and your sellers are onboard, throw a party!  You can include catered food, live music, prizes, and alcohol to lure in local buyers and real estate agents in your area. Any instagram picture opportunities are a great way to get people to post about the property or you! Creating just enough buzz around the party could bring in the right people, or at least get you the exposure that a normal open house couldn’t.

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Pros & Cons of Using Professional Photos

By | Agents

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We’ve all seen it before. Real estate home photos that are so small and pixelated that you have to put your nose to the screen to make out exactly what room is shown. If you look at any website that sells a product, you’ll notice the professional product photos. Making your product appeal to an audience is every advertiser’s primary concern. And when it comes to real estate, there is no doubt that photos are a crucial part of the selling process. When prospects see your listing, you want them to follow through and contact you for a showing. However, you always want to provide them with realistic expectations to avoid wasting either parties’ time as well.  We’ve gathered feedback from the top real estate agents and looked at real estate training courses on the pros and cons of professional, high-quality photos for your listings.
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Pros.

The way consumers shop has changed significantly over the recent years. 96% of Americans now shop online.  This means over 88% of potential buyers go online for their property purchase. The first impression you will have on potential buyers is through the photos in your listing. Creating a compelling, yet accurate portrayal of the property is the first step of the selling process. Online marketers know that product photos draw in the customer and are the first thing a customer will see before reading any text. That’s why huge online retailers will spend the time and money to produce excellent product photos of items as small as a $5 fork. Without the visual appeal, the sell is more difficult.

Professional photos can draw more attention to your online listings and even bring more clicks from potential buyers. Since people who use professional photography end up having more photos, that also brings up your click rate. More clicks equals more lead conversions.
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Only 35% of real estate agents use professional photography in their listing, meaning that you’ll be at an advantage if you do decide to utilize this resource.

Listings with professional photographs sell 32% faster, spending only 89 days on the market, compared to 123 days for home without professional photographs. (PR Newswire)

Professional photographers can capture what agents can’t. Experienced real estate photographers are skilled in shooting home interiors in a way that is attractive and professional. They have the knowledge and talent to effectively capture the home’s most notable features. Many may even make staging suggestions that help market the home altogether. They also come prepared with equipment and lighting to capture photos that would otherwise be impossible. Small spaces and basements that lack natural light may have a lot to offer, but without the correct lighting and angle, the spaces can come off as unappealing and push a potential buyer away.
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Cons.

False expectations. While some real estate photography can help show the true character and essence of a home, some photography can produce unrealistic expectations. Photographers may use wide lens cameras that make a room look 10x bigger than it actually is. While it is important to give rooms a great sense of space, unrealistic expectations can lead to showings that actually frustrate potential buyers.

Not worth the price.  Although, some top real estate agents may argue that professional photos will help you boost the sell price of the home, homes listed for $300,000 and under may not be worth the investment of professional photography.  A session can cost upwards of $300, not to mention the editing and time that goes into setting everything up.
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Time. Hiring a photographer and scheduling a shoot with editing and photo transfer can take time. If you’re in a hurry to get a home on the market, you may not be willing to wait 1-3 weeks for professional photos.

In the end, the decision must be made by the agent.  Real estate training and networking can allow you to ask other agents their experiences with hiring a professional photographer. It may be helpful to list out pros and cons for each listing to decide whether photography would benefit the sale. When executed correctly, professional photography can be a powerful tool to advertise a home’s finest assets. Experienced professionals can make an ordinary home look extraordinary while maintaining the home’s integrity. Make sure to read reviews on photographers and take a deep dive into their work to confirm that they convey the look you’re going for, or the look and feel that you think would help your property sell best.
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We’ve all seen it before. Real estate home photos that are so small and pixelated that you have to put your nose to the screen to make out exactly what room is shown. If you look at any website that sells a product, you’ll notice the professional product photos. Making your product appeal to an audience is every advertiser’s primary concern. And when it comes to real estate, there is no doubt that photos are a crucial part of the selling process. When prospects see your listing, you want them to follow through and contact you for a showing. However, you always want to provide them with realistic expectations to avoid wasting either parties’ time as well. We’ve gathered feedback from the top real estate agents and looked at real estate training courses on the pros and cons of professional, high-quality photos for your listings.

top realtors

Pros.

The way consumers shop has changed significantly over the recent years. 96% of Americans now shop online.  This means over 88% of potential buyers go online for their property purchase. The first impression you will have on potential buyers is through the photos in your listing. Creating a compelling, yet accurate portrayal of the property is the first step of the selling process. Online marketers know that product photos draw in the customer and are the first thing a customer will see before reading any text. That’s why huge online retailers will spend the time and money to produce excellent product photos of items as small as a $5 fork. Without the visual appeal, the sell is more difficult.

Professional photos can draw more attention to your online listings and even bring more clicks from potential buyers. Since people who use professional photography end up having more photos, that also brings up your click rate. More clicks equals more lead conversions.

networking in real estate

Only 35% of real estate agents use professional photography in their listing, meaning that you’ll be at an advantage if you do decide to utilize this resource.

Listings with professional photographs sell 32% faster, spending only 89 days on the market, compared to 123 days for home without professional photographs. (PR Newswire)

Professional photographers can capture what agents can’t. Experienced real estate photographers are skilled in shooting home interiors in a way that is attractive and professional. They have the knowledge and talent to effectively capture the home’s most notable features. Many may even make staging suggestions that help market the home altogether. They also come prepared with equipment and lighting to capture photos that would otherwise be impossible. Small spaces and basements that lack natural light may have a lot to offer, but without the correct lighting and angle, the spaces can come off as unappealing and push a potential buyer away.

Cons.

False expectations. While some real estate photography can help show the true character and essence of a home, some photography can produce unrealistic expectations. Photographers may use wide lens cameras that make a room look 10x bigger than it actually is. While it is important to give rooms a great sense of space, unrealistic expectations can lead to showings that actually frustrate potential buyers.

Not worth the price.  Although, some top real estate agents may argue that professional photos will help you boost the sell price of the home, homes listed for $300,000 and under may not be worth the investment of professional photography.  A session can cost upwards of $300, not to mention the editing and time that goes into setting everything up.

Time. Hiring a photographer and scheduling a shoot with editing and photo transfer can take time. If you’re in a hurry to get a home on the market, you may not be willing to wait 1-3 weeks for professional photos.

In the end, the decision must be made by the agent.  Real estate training and networking can allow you to ask other agents their experiences with hiring a professional photographer. It may be helpful to list out pros and cons for each listing to decide whether photography would benefit the sale. When executed correctly, professional photography can be a powerful tool to advertise a home’s finest assets. Experienced professionals can make an ordinary home look extraordinary while maintaining the home’s integrity. Make sure to read reviews on photographers and take a deep dive into their work to confirm that they convey the look you’re going for, or the look and feel that you think would help your property sell best.

Wondering if a switch might be right for you? Give us a shout and learn more.

SCHEDULE A CHAT

or call

(844) 355-6389

how to be a better real estate agent

How To Use Your Open House To Grow Your Business

By | Agents

Real estate agents have begun to debate on the idea of holding an open house. Many agents have abandoned the idea altogether to focus more on digital marketing efforts. Others argue that open houses bring up privacy and security concerns for sellers, while others believe the time and effort is simply not worth it. However, top realtors will attest to the advantage of an open house as an opportunity to showcase and stage the home in the best possible light. Whereas with traditional showings, it can be hard to control since buyers can come by at all times. For some, the more important benefit is the opportunity to interact directly with prospective clients. Even if the home doesn’t sell on the day of the open house, there are key opportunities for agents to grow their pipeline and potentially gain new clients.

top realtors

Prepare.

Conducting open houses can require a lot of effort and attention. Try to avoid having open houses just because the seller demands one.  According to top realtors, open houses that bring in the most traffic are newer listings that are reasonably priced and have easy access from main streets. Use your expertise to assess the situation and lay out all the pros and cons.  If you decide to conduct an open house, set some realistic expectations for prospecting clients. Decide how many guests you would like to attend and how many contacts you’d like to add to your lead list. Creating goals will motivate you to use the open house to its maximum potential. To set realistic goals, you can use the attendance results from other open houses in comparable markets or the local area. Once you are ready to begin marketing the open house:

  • Send invitations to the neighborhood and any community leaders or groups
  • Arrive early on open house day to ensure the house is ready
  • Display signs that highlight special features

Equally as important, make sure the house is in showing shape. Let your sellers know all the hard work you will be putting into marketing the open house to bring potential buyers and that they need to hold up their end of the deal by making sure the house looks its best inside and out. You can forward them these tips on how to stage their listing.

Listen To Feedback.

Open houses are a great way to gain feedback on the property about the price, condition, etc. Ask attendees for the feedback directly, or provide surveys. This information can help you take action with the seller to improve the home and sell more quickly. It’s also a great way to gain perspective of potential buyers. For example, if a family comes by who is looking to buy, but would prefer a home without a basement, you can record these notes to help you sell another home to them that fits their wants. Top realtors make sure to capture the following information from as many guests as possible.

  • How interested (if at all) are they in the property?
  • What kind of homes or properties could potentially be of interest to them? Is there something specific they are looking for?
  • Are they willing to set up an appointment with you? Are they interested in viewing additional homes?
sell real estate

Market Yourself.

Even though there may be others involved in planning the event, take full responsibility. Having your seller present may bring up unwanted emotions that could cause prospects to lose interest. By being at the center of the open house, you are in charge of meeting, talking, and answering all prospects which in turn, will foster relationships and create an open-discussion environment that will benefit both parties. Make an effort to talk to each guest privately and connect with them by asking them questions to gauge how motivated they are to buy or sell. Provide them with something to take away that not only markets the home, but you! Whether it be a flyer or a folder of information, it should promote you and highlight your successes and expertise in the industry. Always include a call to action for them to follow up with you when they are ready to buy or sell a home.

Collect Information

The best real estate training will tell you that follow up can easily make or break a sale. A timely follow up shows prospects that you are proactive, motivated, and eager to help them. A great way to collect contact information is to promise additional information on anything the prospect shows interest in learning more about. Or, place a guest book near the front door and ask each visitor to sign in. In best real estate practices, you will schedule meetings with about 25 percent of prospects who provide you with contact information.
Throughout the beginning of your career, top real estate agents recommend that you hold an open house at least once a week to grow your contact list and build name recognition in the community. When you take the time and energy to plan, organize, and execute a successful open house, you’ll be able to create a dependable flow of leads for current and future listings.

Wondering if a switch might be right for you? Give us a shout and learn more.

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how to be a better real estate agent

How To Stage Your Listing Like a Pro

By | Agents

Staging has become a strategic marketing process that top real estate agents have taken on in an effort to show their property in its best light possible. Successful staging results in buyers visualizing all the opportunities and inspirations the property offers and sellers closing in faster. Staging also allows you to create trends and designs that buyers may be looking for at an affordable price. The process has gained so much popularity that it has become a profession of its own.

Deep clean

Starting with the outside, remember the importance of curb appeal when your house goes on the market. It’s the first impression your potential buyers will have and the last thing they will see as they leave. Replace worn out welcome mats and sweep debris from the porch and driveway, when possible. Minimal landscaping with bushes and flowers can add a colorful fresh touch to any front yard. Think of your yard as a free advertising platform. Create a landscape that can bring positive attention and lure prospects inside.

A deep cleaning of the inside is also necessary in order to show off the best features of the interior and make prospects feel comfortable.

Agents, Brokers, Property Managemnt, Real Estate Investment

Kitchens and bathrooms

Kitchens and bathrooms can often make or break the sale of a home. For example, buyers are willing to pay 41% more for stainless steel appliances. Conduct some research on your target buyer and look for design inspiration on websites where they shop. Buyers in their 20s or 30s tend to shop at Restoration Hardware and West Elm, so staging your property with those designs in mind can help connect the home with their vision. For bathrooms, top realtors always recommend to stage them like a spa. White towels, bathmats, shower curtains and waffle weave robes set the mood for relaxation and give off a spa vibe.

Repair and Replace

If cleaning appliances and hardware doesn’t make it look new, then it may be time to replace. Replacing outdated fixtures is an easy way to modernize your home design without having to spend too much. Broken home items can lead potential buyers to take caution and can actually hurt your sell time.

De-personalize

The best real estate training will teach you that the key to closing a deal is by inspiring buyers to envision the home as their own. Keep personal items to a minimum or remove them altogether. If you’re worried about holes or spots on the wall where family pictures once hung, head to any craft store to buy inexpensive decor that is modern and genderless. Aside from personal items and pictures, remove all religious or political decor that could offend potential buyers or clash with a clean modern design.

Light

Dark spaces give off the feeling of negative connotations and cold space when it comes to homes. During open houses, walkthroughs, and pictures, keep the curtains pulled back, shades rolled up and allow as much natural light to shine through as possible. Heavy curtains should be replaced with lightweight neutral ones. You’ll also want to enhance dim spaces and corners of the home using lamps. A thought-out lighting strategy allows buyers to see everything they need while making rooms look larger and more inviting. Mirrors can also help reflect lighting and enhance small rooms to appear larger while creating a noticeable ambiance.

Purpose

Top real estate agents believe that rooms should clearly portray their functions. Whether it’s an office for an entrepreneur, or a formal dining room, think of an easy way to differentiate each space.  Many homes tend to have rooms that are used as storage space. Unfortunately, these do not captivate buyers and can often throw off their vision. Outline a clear purpose for each room before you begin the staging process. There are many ways to convey a purpose without spending too much money. You can turn a window nook into a reading spot with a small table and lamp. You can add pillows and curtains to a dark basement to create a private meditation escape. Giving purpose to all your rooms gives the sense of a larger home with more functionable spaces. Remember to not make them too personable but to instead inspire imagination within your buyer.

Staging can give any home life by showcasing its best assets to impress buyers and sell quickly for the highest price. Since not all real estate agents stage their homes, you’ll be at an advantage if you do so. Prospects are looking for more than a structure to live in. They’re looking to create future memories, improve their lifestyle, and build their life.

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The Winter Real Estate Market: 4 Ways To Use It To Your Advantage

By | Agents

Winter is coming! A phrase that means so much more to real estate agents than to Game of Thrones fanatics. It’s November 2nd in Chicago and every Chicagoan has begun to prepare themselves for what will be an action-packed, yet bitter cold, holiday season. People become so wrapped up in the everyday madness that communication goes unanswered and business can sometimes go radio silent. Many agents use these next 3 months as down-time and travel. Some even become disengaged with the lack of movement in their pipeline. But top real estate agents use this time to strategize, analyze, and make the moves that will set them up to have a successful and busy start in the new year.

Events/Life changes

The holiday season is known to host more events and parties than any other time of year. Take advantage of this and utilize those networking skills and proven strategies at your holiday office party (link to networking blog). Look for local charitable events to get involved in. Keeping yourself busy with meeting new people will allow you to focus and grow your database of contacts. The holiday season is also known for it’s abundance of “life changes”. Proposals, babies, divorces, retirements, marriage, and promotions. Keep a record and timeline of your network’s life changes and follow up where you see fit. Helping people through these milestones leaves a lasting impact and generates positive referrals.

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New brokerages

Take the time to reflect on your career and the progress you’ve made along the way. Are you happy with your bottom line? Do you have the team you deserve to support you through your monthly highs and lows? Are you in an environment of consistent learning?  Look into other brokerage models that may better serve your journey. The Chicago real estate brokerage market is diverse. 100% commission brokerages have been growing in popularity and disrupting the industry by placing the agent in the center. Set up calls and meetings with your top 5 brokerages and feel them out to see if there is potential opportunities. Even if you choose to stay where you’re at,  learning more about the changing brokerage model can only benefit your future decisions. Stay informed.

Marketing / Branding

The holiday season brings more people online than any other time of year. Why? There is a variety of reasons as to why the consumer is spending an average of 2 hours every day online during the holiday. Most stats point to holiday shopping and falling victim to the ever-rotating propaganda of the “Holiday Sale”.  Take advantage of the thriving commerce and plan to post relevant content regularly to get in front of potential future clients. Even if your content is not real estate-oriented, it’s important to connect with your audience in one way or another.

Companies spend months working on their holiday campaigns that will advertise during this season and attempt to attract the active consumer. Take note! These campaigns are filled with proven strategy and mass amounts of money. Analyzing brands’ selling strategy can give you new ideas and insight into how you can plan your own.

We know the average consumer is exposed to around 5-10 thousand advertisements daily. To stand out, branding has become an important component to attracting the buyer. Take the time to reevaluate your branding and if necessary, re-brand yourself to stand out and win your audience in the new year. Pay attention to trends and what kind of ideas and concepts have been attracting your target clients.

Education

Every successful real estate agent has taken the initiative to continue their education in one regard. You don’t have to physically register for classes to continue your education. Online classes and webinars serve as great platforms to expand your knowledge on any given real estate topic. You can also take your learnings to create white papers that will live on your website and serve as an information source to your clients.  For example, if you are selling homes in a city known for its colonial style, it may be beneficial for you to take a colonial design course to learn more about the meaning behind the structures and designs.

With these initiatives, you may find that your “slow season” is in fact not slow at all. Being proactive during the holidays will empower you to set yourself up and hit the ground running in the new year. In a time where others take off, use these tips to motivate you to reflect on your business and expand your strategy.  Use this season to your advantage and enjoy all the cheer it brings.

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How to be a better real estate agent

Top 5 Tools Every Broker Needs

By | Agents

A new year means it’s time to identify new tools and technology that could benefit your business in 2018 and beyond. Top realtors will tell you the importance of tools that save time. Time is money in the real estate industry. Tools to help agents become more efficient are becoming easier to use and access every day. Having a stack of effective marketing tools will help you generate more leads and showcase your personal brand in front of potential prospects. Also, staying organized will allow you to stay on top of all your conversations and communications to properly walk prospects through a customer acquisition journey.

Google Alerts

Google Alerts is a content change detection and notification service, offered by Google. Any time that new content is created, or existing content is updated on your chosen topics, you will receive an email notification with a link to access the article, journal, blog etc. Use these alerts to stay on top of industry content that relates to you. For example, you can choose Chicago neighborhoods that you want to learn more about or want to monitor any and all information published about them.  Or on the contrary, you can use google to monitor any mentions of you, your business, or brokerage. This is a great way to find good reviews on yourself that you may not have known about.

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Mailchimp

Aside from the platform being very user friendly, it’s free! Mailchimp is a great marketing platform that lets you automate email campaigns to segmented groups of clients and prospects. You can create a signup form that lives on your website and promotes interested prospects to sign up with contact information to be contacted by you. You can also target prospects by buying interest and send campaigns and information that is valuable to them. For example, if you create an email list of prospects who are looking to move to Lincoln Park, you can send content on new listings or information on how the neighborhood is improving. After placing a client into a home, stay in touch and ask for referrals by occasionally sending them useful content and maintaining an open relationship.

DocuSign

A major component of every real estate training program is how to stay organized with contracts and appropriate documentation. DocuSign is an online service that provides a  fast and secure way to sign, send and store documents in a cloud. All of your contracts, proposals, and projects can be easily accessible and you can monitor when they are opened, viewed, and signed by clients. You can easily share your documents with anyone involved in the sales process and they are able to access them from any mobile or computer device allowing you get documents to clients, anywhere at anytime.

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Accompany (for Gmail)

With the various ways of communication these days, learning to be a better real estate agent means learning to organize and stay on top of your conversations.  Successful real estate agents know that email is a critical part of doing business. Majority of conversation and documents are communicated via email. Accompany for Gmail pulls information from all over the web to give you a detailed profile on every contact in your inbox. Everything you need to know about the sender will pop up right next to their message. You can hover over anyone’s name to learn more about them and help you write better, more personalized emails without having to google and seek out information. Accompany provides info on:

-Bios and links to their social media.

-Where they work, what they do and a brief history of their career

-Their company overview

-Recent news and press coverage on them and their organization

-Shared connections

-Links to email history and meetings you have with them

-Notepad for important facts or details you may want to record about them

Canva

Canva has long dominated the DIY design space.  The web based site offers hundreds of modern design templates for social media, presentations, online ads, flyers and just about any other marketing material you can think of or need. They also give you graphics and fonts to design your own from scratch. Whether you need content for Instagram or a long-form asset, like an ebook or guide, Canva can help your brand design remain consistent, yet unique without paying for a designer.

Learning to become a better real estate agent means finding what works for you and creating your own best practices. These tools have been recommended from top realtors, but ultimately it comes down to you incorporating them into your business to become more effective and close more deals. Identifying your goals and business objectives can help you best pick the tools that may be most useful for you.

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5 Tips to Crush Your Next Networking Event

By | Agents

You will quickly learn from top realtors, that networking is an integral part of driving your business. Although to most, events filled with strangers chattering over free cocktails can seem daunting and even a tad overwhelming, being more strategic about these events can lead to effective career development networking.

There is more to networking than just showing up to an event with some business cards to have a drink.  When you prepare for your networking events with intent and drive with action, networking becomes a powerful way to learn and understand this business better, and also a doorway to new opportunities. Pursuing new education and learning opportunities is a part of any growing career, however with real estate, learning alone will not necessarily create opportunities. Tapping into a network of investors, agents, potential clients, and community leaders will be extremely beneficial to the growth and development of your career. These 5 tips can help you maximize your next networking event.

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Have a plan.

Before you embark into any networking event, you should always have a gameplan. Even if it’s a quick brainstorm on how to maximize your time or a mental note on the list of people you want to meet and transform into customers, mentors, and referral sources. Many events have groups where you can see attendees and speakers. Be sure to do your research and take note of any notable people you want to connect with. When thinking about your potential conversations, rather than trying to impress or overshadow people, focus on your area of expertise and provide insight on what you know best.

Build rapport.

Top real estate leaders follow the principle of elicitation. Elicitation is the act of gathering intelligence and detail by getting people to talk and more importantly; learning to listen. Being able to capture details and open them into greater context will help you form a relationship with the potential client and also help you refine your selling strategy to target their interests and needs. The more that you know about them, the better you can help them. It will also help you build rapport. Successful real estate agents define rapport as a prerequisite for closing deals. Rapport defines as “a close and harmonious relationship in which the people or groups concerned understand each other’s feelings or ideas and communicate well”. A real estate client can not be defined by any single type of personality. Which is why in the real estate industry, building rapport is vidal in helping you learn how to communicate with every personality type and walk of life.

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Don’t ignore other industry professionals.

Successful agents not only build a pipeline of clients, but also a strong network of peer agents that they can learn from and work with. Engaging with other real estate professionals at networking events can open up opportunities to learn about new marketing information and innovations or tools your industry peers are using to find success. Make it a point to follow your new connections online presence to analyze their strategies and learn from them. Making a point to meet up for coffee or drinks is also a proactive way to stay connected and strengthen your relationships with the people in your industry.

Make a point to locally give back or get involved.

Being an active participant in your community has benefited the career growth of top realtors. Community involvement can expand your pipeline and grow your knowledge of neighborhoods and the type people who live in them. While networking, seek out community leaders that may be part of or run local organizations and charities.
Ideas on how to get involved:

  • Volunteer: Spending time with local groups and organizations is a great way to give back while meeting leaders of the community. You can even keep it within the industry and seek out a local chapter of Habitat for Humanity. People appreciate positive community work and it also serves as great content to share your initiative on your website or social media.
  • Education: Whether partnering with schools for career days or attending local colleges to speak at real estate classes, engaging with students who are interested in learning about real estate is a powerful way to become a thought leader in your space and community. Even hosting online tutorials and live Q and A is a great way to engage potential clients.

Follow Up.

After the handshakes, well drinks, and weather talk you’re left with a stack of business cards. When you accept someone’s card try to write down an important connection on the back for follow up.  After the event, turn your networking efforts and notes into an accessible database of valuable contacts. Timing is everything. The longer you leave your new contacts unattended, the harder it will be to stay top of mind with them.

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Rise of The 100% Brokerage: Is It For You?

By | Agents

Whether you’ve just passed your real estate test or you’ve been working in the industry for years, choosing the right brokerage is a decision that will require you to determine how you envision your career unfolding and what resources you want and need to help get you there.

The new generation of 100% commission brokerages have made their presence known in the industry and are beginning to attract top tier talent with their favorable model, a model that has put the traditional brokerage into question and has begun to define the future of the industry and its agents. Before, real estate agents were joining brokerages to rely on their powerful marketing tactics to bring in leads. Now, the shift to social media and online marketing has given new power to the agent to create their own successful sales.

Traditionally, real estate agents and brokerages agree to a percentage split of the gross commission earned. The split is dependent on variables that reflect the services the broker or agent provides. It’s not uncommon that real estate agents give up to 60% of their commission to their associated brokerage. With the 100% commission model, the agent receives their entire commission earned. The agent then is only responsible to pay a monthly set fee that is agreed upon with the brokerage. This model has not only allowed agents to keep the majority of their commission, but these 100% commission brokerages are concurrently providing their agents with the training, resources, and networking they need to close more deals, meet more people, and become more effective in doing so.

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For the agent looking for their first brokerage:

Until now, it has been common knowledge that agents usually do not stay with their first brokerage for very long.  Reasons vary from low commission agreements to lack of support. Many agents do not fully understand brokerage expectations and regulations before signing on and end up spending more time trying to fit into their mold rather than growing their sales pipeline. 100% commission brokerages have been taking the steps to develop the best real estate training programs that can guide new agents to success. After all, the model is most successful when the agent is consistently closing deals, growing their commissions, expanding their networks and referring new brokers into the model with them.

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For the experienced agent thinking about making the switch:

When deciding on making the switch to a 100% brokerage there are many factors to take into consideration. By now, you’ve built your client base up to where referrals are an important part of your business. With the 100% brokerage model, your full commission will go in your pocket, allowing you to benefit most off of your growing deals. You are able to run business with your client as you see fit without having to stress about the percentage your brokerage will be claiming.  As a seasoned professional, you understand your business best. With 100% brokerages, you are your own boss and are in control of making the decisions that affect you without policies and procedures to hold you back. For example, many traditional brokerages claim to take a percent of their earned commission to use towards advertising and lead generation. However, with social media and online marketing platforms, agents are able to generate their own, highly targeted leads at a fraction of the price. Take the creative control and brand yourself instead of trying to fit within a brokerage’s brand guidelines and rules.

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Independence

Whether you are new to the industry or a tenured professional, independence is key to an agent’s success. Many traditional brokerages mandate weekly sales meeting and office hours that create a standardized work environment for agents. This can impede the agent’s independence and ability to build their pipeline. With the 100% brokerage, agents are given the tools they need to continually learn and grow, and the freedom and independence to build the workday that works best for them. The training provided is not a one size fits all, yet a real estate training that will teach you how to market yourself, fill your pipeline and maximize your close.

Today’s real estate consumer expects to be treated like an individual. Traditional brokerages have systemized processes and procedures that create a worn out, outdated experience for the client. As an agent, your role is more important in creating personalized service for your clients. 100% brokerages allow you to do this without obliging you to follow predated guidelines.

Choosing the right brokerage is important because it will not only have an effect on your bottom line, but your career and your future within the industry. Finding the best real estate brokerage to work for means looking for a hybrid of modern real estate training that not only gives you the education and best practices, but teaches you to leverage your network through technology and smart networking.

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what to expect real estate

Real Estate in 2007 vs. 2016: What to Expect Now and In the Future

By | Property Management

In 2007 and 2008, the so-called real estate bubble burst, leading to a housing recession, millions of homeowners being underwater on their mortgages (they owed more than their houses were worth), and a spike in foreclosures.

Nearly a decade later, what’s changed? Sub-prime loans are no longer given nearly as freely, and there’s been a rise in FHA loans that allow home buyers to put down a smaller down payment, which some may suggest will lead to the same problems as before–people purchasing homes they can’t quite afford, and missing payments soon after signing the papers.

What can we expect, as property managers and landlords, to come of the real estate market in the next few years? Well, that depends on who you ask, really. Let’s take a look at some of the trends in the housing and rental markets.

New Construction and Home Prices Will Go Back to “Normal Rates”

For several years, growth of home sales and new buildings have been slow, but when you think about it, that’s a good thing. For nearly a decade, the trends in the housing and real estate markets have been scattered at best, and now, things will be leveling out. Home prices are expected to return to more “normal rates” that are consistent with a balanced market. After the devastating effects of the housing bust of a decade ago, it’ll be interesting to see how the more “normal” approach will pan out.

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The Generation Gap of Home Ownership Will Even Out

It’s no secret that right now, Millennials aren’t the majority group buying up a lot of property on the market. However, they do represent a good chunk of home buyers, and that’s expected to keep rising. In 2015, young adults represented about one third of home buyers with two million sales. This upward trend is will likely continue, with adults between the ages of 25 and 24 becoming first time home buyers next year. Additionally, other generations will contribute more to the housing market as well, with GenXers and older baby boomers who are entering retirement—two groups of people where many of them are already homeowners—may enter the selling AND buying markets. GenXers will be most likely looking to upgrade, while baby boomers might be looking to downsize and lower their cost of living.

Mortgage Rates and Rents Are On the Rise

Just because home buying is expected to continue to grow, though, it will come with a price. Mortgage rates will likely rise more in the next year than they have in the past several years. These higher rates will drive monthly payments up, and debt-to-income ratios are expected to rise as well. In the same vein, rents will also go up. According to Realtor Mag, more than 85 percent of the nation’s markets have rents that exceed 30 percent of the income of renters. In other words, renting is expensive, and it’s only going to get worse. For many people, it’s more affordable and logical to buy a home than it is to continue renting. Unfortunately, many would-be buyers won’t qualify due to low credit scores, limited savings, and a lack of stable income. The old catch-22, as it were.

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New Home Construction Will Focus More on Affordability

Builders know that they have to appeal to people who are ready to buy, and with the rise of younger buyers shopping for a home, one key factor that builders are keeping in mind now is affordability. To cater to first-time buyers, builders are focusing on building more affordable (read: smaller, fewer luxury finishes) new homes, so that buyers can make payments.

Demand for Housing Will Continue With Slow but Steady Growth

Housing activity at the end of 2015 made it the best year for sales of single family homes since 2007—an impressive feat.  Roughly 501,000 homes were sold last year, up `14.5 percent from 2014, and the numbers are expected to keep rising. Monthly gains were strongest in the midest (up 31.6 percent from November to December 2015), but the average gain is more in line with the number of homes that were sold in the South and West — a lower number than the Midwest. Ralph McLaughlin, chief economist at Trulia, said in an email to U.S. News that the grows reflects “a slow but steady increase in demand from homebuyers as well as increasing confidence of home builders.”
That is, it’s safe to expect that more homes will be bought, and more homes will be built.

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Where Do We Go from Here?

With real estate sales expected to rise, and rental prices expected to soar, what’s the best option for investment property owners here? If you’re already involved in owning investment properties, you may want to reassess what you are pricing your units at, and if you’re considering getting into the industry, it might be wise to check with neighborhood advisors in the areas you’re looking to buy in to see if the investment will provide good returns.

Not sure where to turn? Contact Lofty anytime. We’re a property management company in Chicago, helping our clients with every aspect of the process of getting into investment property ownership so that they can live the life they deserve. Call us today to learn more about all we can do for you.

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What is Considered Taxable When You Own Rental Properties

What is Considered Taxable When You Own Rental Properties?

By | Property Management

If you’re considering getting into investing in rental property, one thing to consider—beyond all of the additional responsibilities you’ll take on by doing so—is how owning investment property in Chicago will affect your taxes. When you rent out apartments, condos, or houses, your taxes can become complicated. Repairs and upgrades may or may not be deductible, and any money you make on rent will need to be claimed on your taxes. Beyond that, what should you know about how owning investment properties affects your taxes? As a property management company in Chicago, we at Lofty do our best to help our clients succeed with their investments, and part of that means making sure they understand how investing in property will alter the way they do their taxes. This guide will help you prepare yourself for what’s to come when you start working with property investments.

Deep clean

Starting with the outside, remember the importance of curb appeal when your house goes on the market. It’s the first impression your potential buyers will have and the last thing they will see as they leave. Replace worn out welcome mats and sweep debris from the porch and driveway, when possible. Minimal landscaping with bushes and flowers can add a colorful fresh touch to any front yard. Think of your yard as a free advertising platform. Create a landscape that can bring positive attention and lure prospects inside.

A deep cleaning of the inside is also necessary in order to show off the best features of the interior and make prospects feel comfortable.

What is Considered Taxable When You Own Rental Properties

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Is Everything You Collect from Tenants Taxable?

Not quite. Yes, rental income is taxable, but you’re allowed to reduce your rental income reporting by subtracting expenses that you incur from preparing your property for rental, as well as maintaining it. You’ll report the income as you would any other income—for instance, any rent you collect during 2016 would be claimed on your 2016 taxes. Even if you receive a check for January 2017 in December 2016, you would still claim it for 2016 earnings. If you receive a deposit for first and last month’s rent, it’ll be taxed in the same year, not as separate income in different years.

Security deposits, however, are not included in your taxable income, since you’ll be (theoretically) returning them to your tenants at the end of their lease. If the deposit is merely “last month’s rent,” it’s taxable since it’s just advance rent, but security deposits that are returned aren’t considered taxable income. If, at the end of a tenant’s lease, you keep (any or all of) their security deposit, you will then have to count it as taxable income.

What Expenses Can Be Deducted from Rental Income?

Luckily for investment property owners in Chicago, there are a number of deductible expenses that can save you money when it comes time to pay the tax man. Expenses such as advertising the unit, cleaning and maintenance, homeowner association dues/condo fees, insurance premiums, local property taxes, pest control, trash removal fees, repairs, utilities, and more are all counted as deductible expenses on investment properties. To learn more about all of the eligible deductions, it can be helpful to work with a professional CPA.

What If Your Property is Sometimes Owner-Occupied?

If you own a vacation home that you rent out for part of the year, you should be aware that, in order to deduct losses on the property, you can’t use the property for more than 14 days or 10 percent of the days the unit is rented during the year, whichever is greater. This also applies to a piece of property, say, a house, that you bought and lived in for a few years before renting out—if you still plan on occupying it for part of the year, you’ll need to work with your account to figure out exactly how your taxes will be calculated.

How Do I Report Rental Income and Activity on My Tax Return?

As an individual, you’ll have to report the rental income as, well, rental income. However, you don’t have to do it on your personal taxes. Most landlords establish LLCs, or limited liability companies, for their rental properties. LLCs offer liability protection so that you can keep your personal and business assets separated.  This way, only that bank account, or that LLC, is liable for debts associated with the property. This is beneficial because then, your personal finances won’t be affected by problems with your rentals. LLCs also offer tax benefits, by allowing you to pass tax consequences of your rental properties on to your personal taxes—in other words, you won’t have to deal with corporate ownership taxation. Your personal finances will be safe, and you won’t be double-taxed on your properties.

Need Help With Your Rental Properties?

Getting help with the transition into investment property ownership is something a lot of people seek out, and for good reason. Going it alone can be stressful and frustrating, and it can be beneficial to have someone on your side to explain the various processes of investing in property. At Lofty, we understand the intricacies and difficulties that new landlords face when they get started with rental properties. Our goal is to make your life easier—to help you sort through all of the responsibilities so that you can live the life you deserve, rather than spending countless hours on paperwork, apartment maintenance, and other busy work. If you need help with getting started on owning Chicago investment property, or you have questions about how getting started with investing will change your taxes, feel free to contact us anytime—we’re here to help!

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5 Key Things to Add to a Lease that Many New Landlords Forget

5 Key Things to Add to a Lease that Many New Landlords Forget

By | Property Management

If you’re new to the investment property game in Chicago, you’ve potentially created your apartment leases based on a few different ones you saw online or signed yourself when you were a tenant. Times change, though, and it’s important to craft lease agreements that are tailored specifically to your units as well as the most common issues that arise in the city you own investment property in. A lot of new landlords tend not to customize their leases, which can lead to problems. As a property management company in Chicago, we at Lofty understand what loopholes and gaps in lease agreements can hurt landlords and property owners, and we work to ensure that our clients are protected. When you write up your leases for your tenants, be sure to include these five key points to make sure everything is covered.

1) Who’s Responsible for Rent in Multiple-Tenant Units

If you rent units that are multiple bedrooms, be sure to put clauses in the lease that dictate that even if one person moves out, the total amount of rent will still be due. One common mistake that new landlords make is forgetting to add these clauses. This can cause problems and arguments with confused tenants, who were under the impression that if one person moves out, the remaining tenants will only be responsible for their portion. Of course, this leaves the landlord in a jam and can cause a loss of profit, so it’s essential to put a stipulation detailing how if someone moves out, the remaining tenants will still be required to cover the rest.

5 Key Things to Add to a Lease that Many New Landlords Forget

2) Clear Terms of When the Lease Starts and Ends

Some landlords forget that when they write out a lease, they will need to write in exactly when it starts and exactly when it ends. Without specific dates, a tenant may try to argue that their lease started later and therefore will end later—this can cause a landlord to run into problems stemming from showing the apartment and signing a new tenant to lease it, only to learn that the current tenant has no intention of leaving. If this happens, the landlord may be at the mercy of common law, which, at least in Chicago, tends to favor tenants. Be sure to include the specific start and end dates of your leases so that tenants don’t try to overstay their welcome or dodge rent increases.

3) What Repairs the Landlord and Tenant are Responsible For

Some tenants think that their landlords are responsible for every little repair, down to replacing burned out lightbulbs. If you want to avoid fielding phone calls about things like that, make sure that you dictate what you are responsible for and what your tenant is responsible for. Some landlords will put in a stipulation of a dollar amount—for instance, the landlord is responsible for any repairs that cost more than $25—while others simply suggest calling the property manager to discuss any maintenance issues. Whatever your preference is, make sure that your lease tells your tenants exactly how to manage any problems they have with the property.

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4) Limits on Occupancy and Subletting Rules

In the current age of short-term rental sites offering housing for vacationers in popular cities, the convenience for travelers can turn out to be a nightmare for landlords. Because these short term renters from sites like Airbnb are not background checked, it can open your tenants and your property up to vulnerabilities and damage. Be sure to write into your lease whether you will allow situations like this to happen, and if not, be sure to outline what will happen with tenants who violate the terms.

Be sure to outline who is allowed to stay in the unit, as well. Some problems arise when a tenant has someone come live with them off-lease, and then the new unauthorized “tenant” causes trouble or damages the apartment. Without regulations about who is allowed in your rental properties, the cost for solving these problems can come back to you. When you outline who can live on the premises, however, the tenant is then responsible for any issues their guests cause.

5) Illegal Activity and Eviction Grounds

Finally, many new landlords forget to put in their lease what will happen in the event of a tenant being found to be participating in illegal activity. Some tenants think that because it’s “their” space, it doesn’t matter what they do, so long as they do so indoors. However, this is not the case. If you find yourself needing to deal with a tenant who is breaking the law by, say, doing drugs in their apartment, it is much easier to do so by presenting evidence that they’re not just breaking the law, but that they’re breaking the terms of their lease and as such are voiding the validity of their rental contract.

Include outlines of what will cause tenants to be evicted, as well. This can help prevent any surprises to tenants and can help minimize conflict.

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Need Help Drafting Your Rental Agreements?

If you’re struggling with your investment properties and need help putting together a complete rental agreement that covers all of your bases, working with a property management company in Chicago can be extremely beneficial. At Lofty, we’re dedicated to working with all of our clients so that they don’t have a schedule full of busy work. We want people to enjoy owning investment properties–as such, we take care of everything from leases to maintenance to move-ins/move-outs, and everything in between, so that you can live the life you deserve. Find out more about what we do to make Chicago investment property owners’ lives easier—call us today.

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What to Do When a Tenant Leaves Your Property Severely Damaged or Destroyed

What to Do When a Tenant Leaves Your Property Severely Damaged or Destroyed

By | Property Management

It’s the part about owning investment properties and being a landlord that people dread the most—walking into a unit that someone just vacated to find it in complete and utter disrepair. Whether you were dealing with evicting a tenant or were simply renting to someone who had no regard for property that didn’t belong to them, you’ve got a mess on your hands. More irritating than that, you know that the security deposit—if there was one—isn’t going to cover everything. When a tenant smashes windows, punches holes into walls, rips up carpet, burns or stains wood floors, cracks tiles, etc., the cost to fix everything can add up unbelievably quickly. Being on the hook for the expenses isn’t fair, but if a tenant didn’t care about trashing the place, they’re probably not going to willingly offer up the cash to fix it. So what do you do?

First Things First: Document Everything and Contact Police

Take pictures and video of everything that’s been damaged. Make sure you’ve got everything—for safe measures, it can be a good idea to simply photograph the entire unit. Make sure that the photos you take are timestamped with the day and time. This can help you if you need to go to court over the damages. File a police report about the damages. This gets the paper trail started, and may even make things easier, if you can use police help to find out where the tenant’s new address is for legal proceedings.

You’ll also want to contact your insurance company and your property management company, if you have one. Like contacting the police, this starts the process of getting things started so that you can be reimbursed one way or another. Your property manager can, at the very least, take note of who the tenant is that did this, so that if you’re ever called upon for a reference, you know what to do.

What to Do When a Tenant Leaves Your Property Severely Damaged or Destroyed

Gather Bids for Repairs

Once you’ve determined all that needs to be taken care of, start contacting contractors to help you put the pieces back together. Keep copies of the bids, and proceed quickly so that you don’t lose money from having your unit vacant and unrented.  Your property management company can provide you with a list of reputable contractors. You can work on seeking restitution later on—right now, the most important thing to do is get your Chicago investment property back to its original condition. The sooner you can do this, the sooner you can start renting your properties out and earning money. Shelling out cash to fix damage someone else caused is not anyone’s idea of fun, but in the grand scheme of owning investment properties, moving past your frustration is the fastest way to get back to turning a profit. Once your properties are back in working order, then you can worry about getting reimbursed for them one way or another.

Use Security Deposit Money

Use the security deposit money to cover the repairs. Of course, if your tenant left the place destroyed, it’s likely going to cost more than their security deposit can cover. Even though your expenses will outweigh the amount of money in the deposit, you’re still required to keep a detailed list of repairs with the costs deducted so that you can show the tenant why they aren’t getting back their security deposit.

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Seek Resolution in Court, If Necessary

If there was enough damage done to the apartment, it may warrant a criminal case to be opened. Charges including criminal mischief and property damage can be filed, and the tenant who caused the damage can be punished for it. However, if the police department refuses to make an arrest, you can still follow up in civil court. You’ll have to file a lawsuit seeking compensation for the cost of the repairs for the damage. Find a good attorney for this part, as they can be the difference between you seeing the repair money or not. If the former tenants were having trouble paying rent prior to the damage, however, you may not recover much. Your outcome will depend a lot on certain case specifics.

How Can You Prevent This?

Unfortunately, there’s not a lot that landlords can do to safeguard themselves. One way that some property owners help incentivize tenants leaving the premises without damaging it after an eviction or after a lease expires is to offer cash back for turning in the keys. This can encourage tenants struggling financially to duck out without causing damage, while getting a little bit of money to float themselves. It might not be the most ideal situation, but it can be beneficial in the long run if it prevents you from having to deal with expensive repairs and renovations.

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Getting Help from a Property Management Company in Chicago

If you’re having trouble with tenants or managing your properties, it can be very helpful to work with a property management company. At Lofty, we’re dedicated to helping investment property owners in Chicago take care of everything at their properties, from finding tenants to scheduling maintenance to, when necessary, dealing with damage and tenants who destroyed property. We make things easier for you so that you can live the life you deserve, rather than spending all of your time on paperwork and phone calls. To find out about how we can take some of the work off of your plate, contact us anytime.

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All About Section 8: A Guide for Owners and Renters in Chicago

All About Section 8: A Guide for Owners and Renters in Chicago

By | Property Management

Whether you’re a property owner in Chicago or someone looking for an apartment, chances are you’ve heard of Section 8, also known as Housing Choice Vouchers or HCV. The program exists to allow low-income families find quality housing within Chicago’s private market, using federal funds provided by the U.S. Department of Housing and Urban Development (HUD). Through the program, the Chicago Housing Authority pays a portion of eligible families’ rent directly to the landlord. There is a waiting list to receive these vouchers, and names are selected from the waiting list randomly using a lottery service.

How Section 8 Apartments Are Rented

In Chicago, Section 8 tenants apply to apartments the same way any other tenant would—through the landlord’s standard application process. If they are approved by the landlord, a CHA representative will inspect the property to ensure that the unit meets basic housing quality standards.

Then, the tenant will sign the landlord’s lease and pay a predetermined portion of the rent, which is typically at least 30 percent of the family’s adjusted income. To cover the rest of the rent, the landlord enters a separate agreement with the CHA, in which the CHA agrees to pay for the balance of the rent, directly to the landlord.

In Cook County (so, in all of Chicago), landlords may not refuse to accept Section 8 tenants, as “Source of Income” is included in the Illinois Fair Housing Law’s protected classes. This resolution took effect in 2013 and was meant to encourage economically disadvantaged citizens to move toward the suburbs and decrease high concentrations of poverty-stricken areas within the city.

Landlords, can, however, reject applicants based on factors not related to their Section 8 status. For instance, if background checks or bill payment history are not up to snuff, or previous landlords cite problems with the tenant including property damage or problems with other tenants, or breaking lease terms, these can all be factors that contribute to a landlord rejection a Section 8 applicant.

All About Section 8: A Guide for Owners and Renters in Chicago

Questions Owners Might Have About the Section 8 Program

As an investment property owner in Chicago, you might have some questions about how the Section 8 housing program affects your properties:

  • How can I list my units for Section 8 renters?  Start by contacting the housing authority. They will have to approve both you as a landlord and your properties, and your units will need to be inspected. After that, you’ll be able to list your properties for those who need to rent affordable housing.
  • How much rent can I charge? You can set the rental price to be whatever you want, but it must be reasonably priced compared to your other units. If the rent is too high, you may be required to lower it to meet the needs of lower-income renters.
  • What if I have problems with my tenant? Dealing with problem tenants who are Section 8 renters will be the same as dealing with any other tenant. Unpaid rent, excessive damage, or other issues will have to follow city regulations up to and including eviction.
How Section 8 Apartments Are Rented

Answers for Tenants Using HUD Vouchers

If you’re a renter in Chicago wondering about how to qualify for and rent a Section 8 apartment, you’ll have to apply at your local housing agency. The amount you pay for rent will depend on your income and family size. Unfortunately, the waiting list for receiving Section 8 assistance may prevent you from being chosen for eligible housing immediately. However, once you are accepted, you will be able to rent in any area that has Section 8 apartments available.

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Getting Started with Section 8 Renting

If you want to start offering your properties as Section 8 units, your property management company can help. At Lofty, our goal is helping landlords achieve the best returns on their investment property, and we’ll help you work toward your goals, no matter what they are. As a property management company in Chicago, we have experience making sure that landlords are prepared for whatever might come their way, and we’ll help you get your apartments set up to pass inspection for Section 8 rentals, should you so desire.

We believe that investment property owners shouldn’t have to spend all of their time working on their properties, and we do everything we can to make sure that you live the life you deserve while being a landlord in Chicago. To learn more about all we can do for you, contact us anytime.

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Why to Consider Offering Long-Term Leases in Chicago

By | Leasing

If you own rental properties in a big city like Chicago, you know that sometimes, you’ll work with tenants who are looking to stay put for a few years, and in an effort to reduce some stress on themselves will request a longer-term lease than is standard. Instead of leasing for one year, these tenants may request to sign two, three, or even five-year leases to avoid having to move. While the initial idea may not sound so great to you—how will you earn money on the changing rental market if you’re locked into a certain rental rate for a few years—it can be very beneficial to offer extended leases to tenants. As a property management company in Chicago, we at Lofty understand the hesitance of some owners and landlords to committing to longer leases than one year. It’s important to first have your renters sign a one-year lease, and after they have established that they’re trustworthy tenants, you can consider a longer lease. We want to make sure our clients get the most out of their investments, and for that reason, we’re sharing some reasons you should consider offering long-term leases to reliable renters.

1) Guaranteed Income

Perhaps the biggest benefit of offering longer term leases to tenants is the guarantee that you’ll have rented units with guaranteed cash flow for the duration of those leases. Instead of having to worry about finding a new tenant after one year, you can relax a bit and enjoy the steady influx of profits instead of worrying about creating new listing ads, screening new tenants, preparing the rentals for new tenants, and everything else related to tenants moving in and out every year. Decreasing the amount of time you have to spend on all of that not only saves you that time (obviously), but it has the added benefit of ensuring that you won’t have to deal with any vacancies during that time. If you’re worried about signing a tenant onto a rental rate that may have you earning less profit in their second or third lease year, just imagine what the cost is of having an empty unit for a month or longer every time a tenant moves out. Letting tenants sign two year leases is the perfect happy medium—they get two years of calm comfort, knowing they’re locked into a rental rate and won’t have to move, and you get two years of steady income without the worry that the market will change so much that you’ll be losing money on their rental rate.

2) Less Heavy Maintenance Related to Turnover

Another benefit of offering longer term leases is that it can reduce the amount of moving-related maintenance that you have to do. For instance, if you are required by law to repaint every time a tenant moves out, and you have tenants moving out every single year, you’re spending a lot of money on paint (and painters, if you’re not doing the job yourself). Now add on all of the other maintenance and cleaning that you have to do when tenants leave—imagine doing all of that work less frequently. Even if you’re working with a property management company that takes care of all the work that needs to be done, simply not having to do so is still the easier and more convenient choice. When tenants stay in your properties longer, you get the benefit of needing to do less work on your buildings.

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3) You Can Focus On Other Investments

When you’ve freed up the time that you would spend writing new listing ads, showing the units, and screening tenants, you can use that time to work on other investments.

With the steady cash flow from long-term leases and the time to look at other properties, you may find your investment property portfolio growing much faster than you thought it would. This can lead to even more profits and opportunity to invest in other Chicago properties. Growing your own business is a huge benefit of offering long term leases. The two may not sound like they are related on the surface, but it tends to have a domino effect.

4) Better Tenants Who Are More Trustworthy

Finally, offering long term leases tends to attract trustworthy tenants. People who are more destructive or disrespectful to rental properties typically look for shorter term leases so that at the end of their time, they can cut and run without any adverse effects. If you’ve got a prospective tenant asking to sign a contract for multiple years, however, they’re indicating that they’ve got a reason to want to stick around for a while. Whether it’s a locked-in rate or even just a great location for them, people who rent for a long time tend to view the property as something they should treat well. In general, tenants who stay in one place for many years may be more trustworthy and cause less damage than those who are looking for shorter term leases.

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How to Know What’s Right for Your Properties

If you’re not sure if offering long term leases is right for you, working with a property management company in Chicago can help. At Lofty, our goal is to make sure that our clients are getting the most return on their investments so that they can live the life they deserve, and we can help you figure out the best ways to market, rent, and maintain your Chicago rentals. To learn more about all we can do for you, contact us anytime. 

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Things to Include in Your Chicago Rental Ads

5 Things to Include in Your Chicago Rental Ads to Edge Out Competition

By | Leasing

When you own investment properties in Chicago and are on the hunt for the best tenants to rent to, it’s important to post great ads to entice potential renters. Standing out against your competitors’ ads is easier than you might think—-it comes down to including five things that show to tenants that you’re the one they should be renting from and not anyone else. As a property management company in Chicago, we at Lofty know that some ads will be more successful than others, and we strive to help our clients draw in the best renters possible. Follow these tips to edge out your competition and find the best people to rent to.

5) A Headline that Avoids All Cliches

When you scan through rental listings, you likely see the same headlines over and over, with emphasis placed on the same key phrases—”Great location,” “Going fast,” “Recently rehabbed,” etc. While these help renters distinguish run of the mill places, they’re a bit empty and can be a lot stronger to catch someone’s eye. Instead of simply noting where the rental is and that it might be in a popular neighborhood, point out things that are great about the property itself. Features like hardwood floors, in-unit laundry, or a dishwasher are all points to note about properties that can draw in interested renters. That’s because not all of the rentals in Chicago have these features, and for many tenants, higher end amenities are on their “must have” lists. Include these phrases in your listings and you may find that you get more phone calls about seeing the place.

Things to Include in Your Chicago Rental Ads

4) Staging

Too often, rental listings include photos of rental properties that are clearly still being lived in. While that’s okay, if absolutely necessary, it’s much more appealing to a renter to see what the apartment looks like at its best. If you’re really trying to get your properties rented quickly and to great tenants, one way to entice them is to consider staging the units so that the photos you use in listings look fantastic. Staging may involve purchasing temporary furniture that you can keep in storage (or use for staging other properties), but it makes the apartment look like something aspirational, rather than showing off some other tenant’s old couch and cluttered bedroom. Making your property look extremely well maintained is a great way to get people interested—especially when you think about all of the other properties being listed with dim photos that look like they were taken on a last-minute basis.

3) Outdoor Photos

Another tipping point for renters is being able to envision what their new neighborhoods will look like. Will they live on a tree-lined side street or a bustling intersection? Of course, not every tenant will want one or the other, so posting photos of what the outside of the property looks like as well as its immediate surrounding area can help people decide whether it’s what they are looking for. Many investment property owners think it’s enough to just post photos of their properties’ interiors, but this can cause you to waste a lot of time showing units in busy neighborhoods to tenants who ultimately want peace and quiet, or showing units on a quiet street filled with families and children to people who want to be closest to the latest nightlife openings.

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2) Selling Points

Thinking back to the headline, if you include features of your properties that other property owners in Chicago aren’t offering, you may find that more and more people are interested in renting from you. For example, utilities being included in the rent is something that people will jump at the chance to have, as it cuts down the amount of bills they have to organize every month.

Permit parking or a covered lot are also great selling points, particularly in Chicago where parking is often at a premium. Include the features that tipped you to purchase the building in the first place, as those same features will appeal to renters.

1) A Call to Action

Finally—and this seems almost too simple to include as a tip—it’s important to include a call for your potential renters to get in touch with you. Too many rental ads simply list the facts: cross streets, price, and a bullet list of amenities. If you’re trying to get a property rented fast, make it easier for your potential tenants. Include a call to action at the end of your listing such as when to call, who to ask for, or when showings will take place. Phrases like “Stop by Thursday from 2 p.m. to 4 p.m. to see this unbeatable apartment,” or “Ask for Tony when you call to schedule your showing” can help tenants feel like if they don’t do so, they may miss out on your rentals.

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Getting Help With Your Listings

As an investment property owner, you’ve probably got a to-do list a mile long. At Lofty, we understand that things get pushed off all the time, and when you’re on a time crunch it’s easy to cut corners. As a property management company in Chicago, we want to help you. We’ll help you write the most effective ads possible for your listings, and we’ll also help you screen tenants. After your new renters move in, we can take care of maintenance requests, tracking down rent, and so much more. At Lofty, we strive to get rid of your busy work so that you can live the life you deserve. To learn more about all we can do for you, contact us anytime.

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how to prevent mold in my chicago apartment

What You Should Know About Finding Mold in Chicago Investment Properties

By | Property Management

As an investment property owner in Chicago, you’ve likely come across a deal at least once in your career that sounded great at first, only to turn into a mess after you found out about electrical problems, a shaky, non-level foundation, or mold within the property. Whether you saw the sale through or walked away, chances are you learned some lessons about damage levels or other issues in properties that make your investment worth it, as well as when you should throw in the towel.

When it comes to mold in properties, it can be an insidious problem, and one that is difficult to “diagnose” and solve, but in the long run, making sure your property is mold-free can save you a lot of trouble. As a property management company in Chicago, we at Lofty understand that mold can be a frustrating issue to deal with in investment properties, whether you’re negotiating a sale or you’ve already purchased a building. For that reason, we’ve compiled a list of aspects to consider when purchasing a property that has any mold–what you need to know, what’s fixable and how to go about doing so, and when you should walk away from a sale.

What Is Household Mold, How Does it Grow in Chicago Investment Properties, and How Can You Prevent It?

Before you get worked up and nervous, it’s important for us to point out that while no one wants to hear that their property has mold in it, it’s not the end of the line for your building. In other words, finding mold doesn’t mean you’ll have to level the building and start from scratch to truly get rid of it.

Mold, if you don’t already know, is a simple microscopic organism that exists everywhere— they’re required for the breakdown of organic matter, and they help recycle nutrients back into the environment. Great when it’s outdoors (except for those of you lucky ones with seasonal allergies!), but not great at all when it’s indoors.

Molds reproduce extremely quickly, which is why managing and getting rid of it can be a difficult job. The spores are miniscule, and unfortunately, can grow on just about any surface, which makes homes and interiors the perfect spot for them—they can grow on wood, paper, carpet, dust, insulation, fabrics, and near windows, just to name a few spots.

Mold doesn’t mean you’ve got a dirty building, though—many spores are invisible to the naked eye, and you’d never notice if your tenants or any pets are tracking them in from outside. However, they can grow and take hold of a building before you know it.

Some of the health problems it can cause include:

  • Allergy-like symptoms, such as sneezing, a runny nose, itchy and red eyes, and skin rashes.
  • Asthma attacks
  • Throat and lung irritation

Being exposed to mold most often causes a reaction that’s similar to the feeling of being sick with a cold, so it’s important to make sure you do everything you can to prevent it spreading.

Mold Prevention

The best thing you can do prevent mold within your properties is to make sure that moisture is controlled. Respond to any requests of water damage or broken windows promptly, as well as any basement leaking or other issues that could cause mold growth, like a leaking roof. Make sure your buildings are well-ventilated as well, so that moisture that does accumulate can evaporate.

What to Do If You Find Mold in a Chicago Investment Property

What to Do If You Find Mold in a Chicago Investment Property

If you or a tenant finds mold on the premises of one of your buildings, you’ll need to work with mold remediation companies, and even possibly the Environmental Protection Agency (EPA) to determine the best course of action. Discuss with your property management company when to bring in mold cleanup contractors, as they’re likely already working with reputable businesses in your area.

As a landlord, you’re required to ensure that your rentals are habitable, which means that unless the cause of the mold is tenant behavior, you’ll be responsible for getting rid of it at your own cost.

To find out whether there is mold in an apartment building or other investment property you are considering, inspectors can conduct an assessment, and there are also do-it-yourself mold testing kits available. Depending on the severity of the mold’s takeover, repairs can be done at an affordable rate. However, if you’ve yet to purchase the property, how can you know if it’s worth spending the money to repair mold issues, or if you should just abandon the sale?

Should You Walk Away from Purchasing Investment Property in Chicago that has Mold?

One way you can safeguard yourself when negotiating a deal on a property that’s been found to have mold is to ask for contingencies to be added to your written offer. These contingencies allow you to walk away from the sale if major problems are found—or, alternatively. Purchase at a reduced price or require the seller to cover the repairs.

If you find visible mold, more extensive testing should be done to find the moisture source, seeking out where the problem truly lies. While mold can be fixed, the root of the issue can be an indication that much more expensive repairs will be necessary. For instance, poor drainage, roof or foundation problems, faulty plumbing, and flooding damage can all be very expensive to mediate and repair.

Inspectors will be able to determine the extent of any mold damage, as well as what kind of mold is within the property. From there, you can work with your property management company to determine what the relative cost would be to repair the associated issues.

Whether you stay the course or walk away will come down to your own preferences as well as whether you see value in a property even with required maintenance costs added to the buying price. Your Chicago property management company will be able to offer some insight as well, based on previous experience with repairs related to mold problems.

If you do decide to walk away from a specific property, worry not—your property managers will be able to steer you toward a comparable, or perhaps even better, property investment opportunity.

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Need More Advice?

Whether you’re dealing with mold issues in a property you already own, or you’re considering purchasing investment property and you just learned that there are mold issues to be dealt with, a property management company will be able to lend a hand. At Lofty, our goal is to help property investors make the best decisions for their business, as well as take care of the issues that are pressing with potential or current investments. Maybe you don’t have the time to schedule all of the maintenance associated with mold remediation, or perhaps you don’t live in the area and can’t be on site when contractors are there. Whatever the case may be, we’ll take care of everything so that you can do other important work and live the life you deserve.

For more information about how Lofty can help you with your Chicago investment properties and beyond, contact us today.

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How to Spot Up-and-Coming Chicago Neighborhoods to Purchase Investment Properties In

How to Spot Up-and-Coming Chicago Neighborhoods to Purchase Investment Properties In

By | Real Estate Investment

The trick to turning the biggest profits on investment properties is, like many other investments, buy low and sell high. In other words, find apartment buildings and other properties in neighborhoods that are currently attracting tenants enough to make the investment worthwhile, but perhaps isn’t SO popular yet that the property is too costly. Spotting these up-and-coming neighborhoods can feel a bit like a gamble, but when you know what to look for in neighborhoods that have great properties but not a lot of draw, it’s easier to get a feel for what’s to come. As a property management company in Chicago, we at Lofty are dedicated to helping property investors find the best investments. Here’s our guide for helping you determine which neighborhoods show promise.

Check Out What Businesses Are Moving In

If empty storefronts have plagued an area, but more and more businesses are beginning to sign leases there, it can be a sign of what’s to come. A rapid increase of restaurants or brewpubs, coffee shops, bars, boutiques, and more can be an indication that a neighborhood is on the rise. Likewise, if more chain offerings move in—think places like Starbucks or Target—that can also bring more people to an area. People enjoy living close to a variety of businesses, and the busier a neighborhood gets, the more popular it becomes.

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Take a Look at the Transportation Offerings

If a train station or multiple public transportation stops are nearby a lot of buildings, it can be beneficial to look at those buildings as potential investments.

Many city dwellers rely on public transportation and will seek out housing that is nearest their most-used train or bus lines. If the neighborhood has a lot of public transit options and a lot of new businesses are moving in, this can be a sign that it’s time to buy.

Find Out if Any Large Companies Are Setting Up Camp There

Another thing that can bring a lot of people to an area of the city is when a big company, like Google, for instance, announced they’ll be opening an office there. Employees look for nearby housing, and that’s where your investment properties will come in handy for them. Take a look at news about businesses moving in, and maybe you’ll find some invaluable information.

Research the Average “DOM” or Days on Market Rate for Properties

In tough neighborhoods, when properties sell, they may sit on the market for several months. As those neighborhoods heat up, however, those properties sell faster and faster. This is a huge indication of how an area is doing. Check with real estate agents and your property management company in Chicago to learn about the trends in various neighborhoods in the city. Look for declining DOM rates—the faster properties are selling, the easier of a time you’ll have renting these properties out (and the higher demand means you’ll be able to price your rentals higher, as well).

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Look at the Neighborhood’s Demographics

Up-and-coming neighborhoods in many cities, but especially Chicago, are known for having a high concentration of “creative-type” residents. Because that line of work isn’t known for its fat paychecks (usually), people who rely on art, music, and similar livelihoods tend to find neighborhoods with relatively low rent. However, because these groups of people tend to have a following of people who want to be where the “cool” things are, those areas tend to increase in popularity, leading to increases in rent. Then, the whole cycle starts over. For instance, think of Wicker Park in Chicago about 15 years ago, or Logan Square five years ago. Both neighborhoods were the cheap, hip places to live, and nowadays, Wicker Park is home to booming businesses and hundreds of families, while Logan Square is currently seeing rent hikes and new restaurant openings on a near-weekly basis. Where will the next hot spot be?

Investigate City Improvement Plans

Look to city plans to see where people might gravitate to in a year or two. Are new parks being constructed? Schools? Trails? Amenities that people enjoy being near will cause an increase in popularity in an area, so try and check to see if the city has anything planned in the neighborhoods you’re looking to buy in. For instance, the creation of the 606 elevated trail is leading to an increase in growth on the blocks directly surrounding it.

Proximity to Other Popular Areas

Finally, look at what’s popular now, then look at the areas surrounding it. Where Wicker Park was popular, now it’s neighbors to the west (Bucktown and Logan Square) are heating up. Logan Square is pricing some residents out, who are now flocking to places like Humboldt Park, Avondale, and Hermosa. Take

Need Help With Your Investments?

As a property management company in Chicago, we at Lofty are dedicated to helping people make the best investments. That means providing sound advice on where to buy and what’s heating up, as well as helping you get the best returns on your investment properties in Chicago. We’re a full service property management company, and we’re ready to help you take care of all the minutiae related to owning investment properties, so that you can live the life you deserve rather than working constantly. To learn more about any of our services, contact us anytime!

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5 Most Helpful Aspects of Using a Chicago Property Management Company

By | Property Management

Owning investment property in Chicago is an exciting and busy adventure—sometimes too busy. From making sure your units aren’t vacant for too long between tenants to finding great tenants to occupy them, scheduling regular maintenance, collecting rent checks, performing upgrades and everything else, it’s easy to let owning rental properties become your full time job. The problem is, you likely didn’t get into investment properties so that you could work more. You probably got into it to earn some extra money in an interesting and lucrative way. Thankfully, you’re not stuck working overtime every week—many investment property owners utilize help from Chicago property management companies to avoid getting too tied up in work. Property managers can take a lot of the work off of your plate, of course, but as far as what they’re best at, we’ve put together a list of the five most helpful aspects of using a property management company in Chicago.

5) Finding and Keeping Better Tenants  

From shaping your ads to attract the right kind of renters, to interviewing applicants, running background checks, and collecting security deposits and rents, just the process of getting someone into your rentals can be a lot of pressure. Once they’re in there, there’s the work done to keep them happy and renewing their leases. Finding great tenants can be a hectic and chaotic process, but when you’re working with a Chicago property management company, they can take care of everything. Think about all of the time you spend fielding calls and emails from interested potential renters—just that on its own is a big job. Now, imagine not having to deal with any of that. Property management companies help investors find (and keep) the best tenants. Once people rent out your properties, your property managers will be able to track down rent to ensure you keep getting paid, and they can also mitigate issues with late or unpaid rent. Some property owners say that everything tenant- and rent- related, on its own, can be the reason to get a property manager.

 

4) Assistance With Maintenance

The next area that property management companies in Chicago excel in is maintenance and help with everything associated with the upkeep of your properties. Right now, if a tenant calls you in the middle of the night with an apartment emergency, you have to get out of bed and start making phone calls, trying to find a contractor who can help with that emergency at that hour. What’s worse, you may not even be able to find the solution at that hour. With a property manager, when an emergency arises, they’re ready to go. Property managers have a list of vetted, insured contractors like plumbers and HVAC specialists who can be on the job at the drop of a hat—and you won’t need to be there to let the maintenance worker in!

Imagine not having to worry about what you’d do if a tenant called you about a shattered front window or if tenant’s basement flooded during a springtime storm—because your property manager would already have it covered. That weight off your shoulders can be a lifesaver.

3) Increased Value of the Property

In a similar vein, when property managers have a hands-on approach to the way your property is maintained, they’ll be able to notice problems that you may not see until much later—when it will be costly to repair or upgrade. By noticing these upgrades before they’re absolutely necessary, you’ll be able to work gradually to improve your investment property, growing and increasing its earning potential year after year. Property management companies in Chicago have one common goal: to help their property owners succeed. When they’re working with your properties, they’ll be doing everything they can to help you see a better return on your investment.

 

2) Less Stress and More Freedom for the Owner

Property management companies do more than just take care of problems, though. Because they’re taking a lot of busy work off of owners’ plates, those owners then have a lot more freedom to do other things, like spend time with their families, put in work at their day jobs, or even seek out additional properties to invest in.

When you have more freedom to do what you want throughout the day because you’re not stuck at a desk making phone calls about late rent checks and leaky faucets, you’ll be amazed and what you can get done!

1) Fewer Problems with Renters

You already know that when you work with a property management company in Chicago, you’ll reap the benefits of them finding great tenants to rent your units. However, that’s not the only way that property managers help you with tenants. When there’s an issue with a tenant, such as unpaid rent over a couple months, you may find the process of fines and evictions to be unbelievably tedious and overwhelming, not to mention stressful for everyone involved. When you work with a property manager, though, your tenants know that they’re dealing with a business, not just one person anymore—they may be less likely to try and manipulate your emotions (who hasn’t heard a sob story about being able to pay rent “next week”?), and they may understand that they’ll get away with less when they’re dealing with a company. That’s not to say that you aren’t an authoritative owner, of course, just that it can be easier to resolve issues when it’s not just you fighting them. Additionally, if there are any complaints or problems from tenants, you won’t have to spend all of your time sorting through them—that’s part of how a property management company helps! They can step in and mediate the problem, so that you can get back to doing more important things.

Ready for Some Help With Your Investment Properties in Chicago?

If you’ve been feeling overwhelmed by the work associated with your rental properties, you’re not alone. Whether you’re new to the business or a seasoned vet, it’s not uncommon to need a helping hand with your investments. As a property management company in Chicago, we at Lofty strive to help all of our owners succeed, so that they can live the life they deserve. If you’ve been considering hiring a property management company for your rental units in Chicago, contact us anytime for more information about how we can make your job easier.

Speak with one of our experts to find out how we can supercharge your investment.

What to Know About Allowing Pets in Your Chicago Rental Properties

5 Most Important Things To Know About Allowing Pets in Your Chicago Rental Properties

By | Property Management

Owning investment properties in Chicago is, no doubt, a lucrative business. There’s never a shortage of tenants, neighborhoods shift in popularity ensuring there’s always somewhere that’s booming, and there are plenty of ways to attract more tenants if you do somehow find you’re in a slump. One way that many Chicago rental property owners boost interest in their units is by allowing their tenants to have pets. Cats and dogs are the most common pets for renters to have, but some have birds or small pets like ferrets and hamsters. While allowing your tenants to bring their furry (or feathered) companions into your property can help you find better and more reliable tenants, there are some precautions you may want to consider. As a Chicago property management company, our goal at Lofty is to make sure all of our property owners are well-prepared so that they can have the best experience being real estate investors. To us, that means providing them with the information they need to be the most profitable and secure within the business. Here are our most important tips about allowing pets in rental properties.

5) Make Sure Your Tenants Know Their Responsibilities

When you allow your tenants to bring Fluffy or Spot into your rentals, you’re opening a line of mutual trust—they trust that you’re going to be a good landlord, and in exchange, you’re trusting that their pets won’t wreck the place or become a nuisance. Be sure that your tenants are aware of their responsibilities. For instance, make sure they know their pets should be up to date on vaccinations and registered with the city (if applicable), and be sure to outline upkeep of common areas on the property (for example, let them know that not cleaning up after their dog outside may result in fines, or that their pets may not roam hallways unattended).  Outlining tenants’ responsibilities before a pet even enters the building is the best way to ensure that everyone stays happy. No surprises is a good thing!

4) Plan Ahead for Damage to the Units, Just in Case

Of course, even though every pet owner claims their pet won’t cause any damage at all, as a property owner, you know that’s rarely the case. Pets may have accidents, or their claws may grow out a bit too long at some point leading to scratched floors, or maybe, after 5 years of perfect behavior, a tenant’s dog gets bored and chews on your building’s cabinets.

Whatever the case may be, it’s important for you to plan ahead for this type of damage. There are a few ways to do this. First, many owners choose to charge a pet deposit. These can either be refundable or not, and help cover the cost of any damage that may be caused during your tenant’s stay. Another option is charging additional pet rent each month. This will generally work out to be roughly the same amount of money that you would charge for the pet deposit, but since it’s spread out over the course of the lease, it can be an easier cost for the tenant to shoulder. If you’re unsure of what to do to prepare for pet damage in your pet-friendly Chicago rentals, consult with your property management company—they’ll have plenty of experience and advice!  

3) Look Into Different Pet-Ownership Clauses on Your Insurance

When typical homeowners have pets, they may need to add insurance for their pets onto their policy to cover issues like dog bites. As a property owner, you’ll want to consult with your insurance company and your property managers to find out what you’ll need to do to make sure that you’re covered in the event that something happens on your property. Dog bite insurance claims are more common than you may think, so it’s essential to make sure that you’re prepared for problems (while being hopeful that those problems don’t arise, of course).

2) Have Your Leases Outline What Will Happen In the Event of a Problem or Emergency

While tenants who have pets tend to be more responsible and reliable, you’ll want to outline consequences if there are problems with their pets. For instance, if one of your tenants has an overly aggressive dogs that becomes a menace to other tenants, or gets in fights in the yard, you may not want to continue the rental relationship. It should be outlined in your lease agreements what will happen if there is a continual problem with a tenant and their pets. Ask your Chicago property management company how to properly phrase these concepts in your lease so that you can foster an amicable and agreeable lease agreement with your tenants. For example, outline a system of warnings.

1) Know What You’ll Do if Someone’s Pet Injures Someone

Your property managers will be able to better explain what you’ll need to plan out, but you will want to make sure you have a plan in case a tenant’s pet injures you or someone else on the property. Your insurance should cover any issues, however in the meantime, you’ll want to have a mediation plan set up just in case a problem ever occurs. Whether a dog bites someone through the fence or a cat scratches another tenant and that tenant ends up in the doctor’s office, you’ll want to have things covered.

 

Offering Your Pet-Friendly Rentals in Chicago

As a property investor in Chicago, you’ve likely heard all of the benefits of allowing your properties to be pet-friendly. If you’re interested in learning more about transitioning to allowing pet-friendly units, talk with a Chicago property manager today. At Lofty, our goal is making sure you succeed so that you can live the life you deserve—we’ll help you set up everything you need to ensure your properties and tenants are ready for man’s best friend. Contact us anytime to learn more about how we can help you achieve your property investing goals.

Speak with one of our experts to find out how we can supercharge your investment.

 

How to Prepare Your Chicago Investment Properties for Renters in Spring

How to Prepare Your Chicago Investment Properties for Renters in Spring

By | Property Management, Real Estate Investment

#6. Easier and faster.

Management software has become an efficient way for property managers and property owners to access powerful tools for effectively managing the rental properties for which they are responsible. Technological developments like property management software make detailed tenant and property information accessible virtually anywhere.

A modern property management company has tons of useful software products available to make managing property more efficient. With being a society always on the go, advanced property management companies, like Lofty are embracing the use of technology for their owner and tenant clients alike. Useful, web-based applications can manage everything from contact forms to live chats, listed available properties, tenant screening and applications… Lease and other agreements can even be signed online—this is helpful if you have to move out of the country for work over a weekend, and need help managing your property. In fact, there are ways to “link” these individual components together to build systems that generate feedback and manage the entire property manager workflow in harmony! Do you have goosebumps!?

Because everything can be linked through the internet, property managers can receive alerts at the same rate of transmission as a text message. Mobile connectivity ensures that clients don’t have to wait long for a response. Faster response time mean reduced friction when something unexpected happens, and allows property managers to handle situations as they happen.

#5. Reduce user error

The right property management system provides effective accounting functions and reports that will replace any double-entry errors, and the old fashioned pen and paper. By automating property management tasks, important information is archived through the redundancy of computer processes. Also, utilizing live error-checking features ensures less mistakes are made, and there will be more time to focus on other projects. Come tax season, accountants love those who can effectively take advantage of quality accounting software.

#4. Added value for tenants

Whether it is a request for maintenance work when the washing machine breaks down, a rent payment is due or to simply review their lease, property management software offers online portals as a means of communication between the tenants and the property management company. This communication hub is accessible anywhere, 24/7, and can give owners a place to get a high-level overview of their property status at any given time. By using the property management software’s online tenant portals correctly, the situation can benefit managers, owners and tenants alike by leveling the playing field and allowing each party the advantage of clear communication.

#3. Convenient payment online

With online rent payment solutions software, property management companies, property managers and property owners no longer have to wait for rent checks to get delivered through time-expensive methods like mail, courier, or delivery services, let alone the frequently awkward and inconvenient hand-delivery! Paying online is easier for both tenants and managers when secure ACH or credit/debit card online rent payments are used. Secure online payment gives tenants the opportunity to easily make their rent payment from work, home or anywhere they have an internet connection. By making payment as convenient as possible for all parties, and as secure as an in-person meeting with a teller, quality, modern property management software solutions allow the excuses to just melt away.

#2. Marketing through Social Media

Social media has become more than just a platform for friends and family to keep in touch about life events. It creates a platform for businesses to maintain constant contact with any subsegment of the planet’s population, maximizing virtual awareness and the target audience’s ability to stay proactive. Social media management software allows a residential property management company to market to multiple engagements using campaigns that deploy in multiple social channels at once. With the ability to announce, promote, engage and share your company’s skills as well as your residential inventory to attract new potential tenants all at once, there are endless opportunities to grow brand awareness and create new business!

#1. Property Protection

Using property management software makes background tenant reports instantaneous for property managers, owners and leasing agents. Instant access to tenant screening reports allows managers and property owners review applicant backgrounds including criminal, credit, and eviction history in order for the property owner to make an educated decision about the potential financial responsibility and behavior of the person or people that seek to reside in said owner’s property. By making applicant screening accessible, property management software allows property managers and owners to select the most qualified tenant who will maintain the rental property, much like their own home, respect the agreed upon lease terms and pay their rent on time.

Developments in technology have paved the way for property managers and property owners who are seeking more efficient processes to streamline their business and boost profits. By incorporating the latest property management software applications into their daily operations, property management companies can evolve to become more efficient and effective, industry-wide. Not only have affordable property management systems been developed to make managing rental properties online easier, but today’s renters are seeking and appreciate the convenience of online services provided by their property management company or landlord.  Technology within this industry has changed and evolved to be convenient, cost-effective, and efficient for property owners and/or property managers to provide extra services to their tenants, organize their data and improve their business processes.

Here at Lofty, we pride ourselves on existing on the leading edge of property management software technology, and we use it daily to enhance our client’s experiences. The purpose of technology is to make tasks easier to perform, and there have been many advances in property management systems to the benefit of the client. By automating a lot of the tasks that can bog down personnel, Lofty is able to pay more attention to our clients’ needs and create a customer service experience unsurpassed in property management! Talk to us today, and see how we can help you live the life you deserve.

Speak with Anthony Zammitt, Lofty’s managing broker to find out how we can supercharge your investment.

how to appeal my chicago property taxes

Should You Appeal Property Tax Assessments on Your Chicago Investment Property?

By | Property Management

Owning investment property in Chicago can be a lucrative and successful business for a lot of landlords, but one common issue here that many investors dread is property tax assessments and tax hikes. In Chicago, tax hikes are can be compared to whether it will still snow in April every year—it’s going to happen, the question is how much?
One thing you probably know is that appealing those assessments is possible, and many people choose to do so to save themselves money every year. After all, your property taxes are determined by the city’s tax rate and the appraised value of your property. In tougher market years, that appraised value might not be all that accurate, which can lead to discrepancies and unfair property tax assessments. Appealing the property tax bills you get can be done, but it’s important to know when to do so and how to do it. As a Chicago property management company, we’re more than familiar with the intricacies of appealing property tax assessments, and if you need help, we’re more than prepared to lend a hand.

What to Know About Appealing Your Property Tax

First and foremost, it should be pointed out that you won’t actually be appealing the tax rate. Rather, you’ll be appealing what the city has decided is the value of your property. Many homeowners and investors have found that when the value of their property is given, it’s not accurate in accordance with the current market, and therefore should be appealed.

These problems arise because the valuations of properties are only taken every three years in Chicago. That can lead to great discrepancies between the reported value and the actual value, particularly in years where the economy and the housing market are in a slump. Your home may be reported as being worth a lot, but, for instance, during the housing crisis several years ago, many homeowners found they owed more on their mortgages than their homes were worth. For this reason, it’s important to keep up to date on what your home or Chicago investment property is worth so that when you do receive the assessments, you’ll be able to tell if it’s accurate and reasonable or not.

 

Who Do You Appeal To?

Depending on how determined you are to adjust your property tax bill, there are five different levels you can take your issue to.

First, you can bring the issue to the Cook County Assessor’s office. If they don’t allow an appeal, you can ask for a re-review (your second chance). The third option is to file an appeal with the Cook County Board of Review, and fourth is to the Cook County Circuit Court. Finally, if the issue still hasn’t been settled, you can appeal to the Illinois Property Tax Appeal Board. Some landlords suspect that the first step or two may result in a “no” answer for the appeal simply to discourage those who are less tenacious in their fight.

When to Appeal Your Property Tax Assessment

Since Chicago is known for its complicated processes with all things administrative (let’s not talk about the city sticker process, okay?), it stands to reason that the property tax appeals process is a bit complicated. Each year, there are different windows for “townships” to appeal their taxes. Townships refers to parts of the city, and you find out which township you’re in by looking at your property tax bill. Your township name may not be the same name as the area your property is in—like we said, Chicago can be confusing.
Generally speaking, you have about a one-month window from the time you receive your assessment to the time you can file the initial appea. About a month after that is the final deadline for requesting a re-review. However, these time frames can vary depending on when you initially submitted your appeal.

 

How to Know Whether You Should Appeal for Your Chicago Investment Properties

When you appeal, the county will be looking for a valid argument about why your property taxes should be adjusted. These arguments include, but are not limited to:

  • A discrepancy between the suggested value of your property versus the suggested value of the other properties in the area. In other words, if your property is valued much higher than the similar surrounding properties, your tax bill may be unnecessarily higher than it should be. These discrepancies are one of the most common reasons people appeal their taxes.
  • Overvaluation: this means that your argument is that whatever the assessed value of your property, it’s not in line with the current market value. This is a tougher argument to prove than others, but many people still fight this way.
  • Incorrect information leading to improper tax valuation. For example, the county is incorrect in what they’ve assessed your property to be, such as the property being listed as larger than it is, damage that affects value being unlisted from the property’s records, etc.

One tough reason people appeal to is the condition of the home. If your Chicago investment property needs a lot of work done to it, yet is being valued at the same price that a similar-sized property in much better condition, you may have a hard time appealing, simply due to the county’s lack of concern about these factors—don’t you wish we had a better reason for this other than “they don’t really care?” Us too.

Getting Help with Appealing Your Property Tax Assessment

Appealing your property tax assessment can offer benefits such as no longer needing to raise your tenants’ rent as much as you thought you would, as well as simply saving yourself the money. If you’re interested in learning more about the appeals process, Lofty can help. We’re a property management company in Chicago, and our number one goal is to make owning investment properties in Chicago easier and more enjoyable. Let us give you a hand with the tedious work surrounding tax appeals (as well as any other tasks you may need help with), so that you can get back to living the life you deserve.

Find out more about all of our property managements services in Chicago today—contact us anytime.  

Speak with one of our experts to find out how we can supercharge your investment.

 

property managers in chicago

Managing Parking at Your New Chicago Investment Property and How Property Managers Can Help

By | Property Management

Purchasing rental investment properties in Chicago with parking isn’t as rare as you might think, particularly in busier neighborhoods downtown and where street parking is hard to find.

In those instances, paid parking spaces or rented spaces in a lot are common, and when you’re the landlord at the property, they mean more responsibilities you’ll have to tend to.

Offering parking at your properties can give you the opportunity to earn more income—many landlords in large cities like Chicago won’t automatically include parking in the rental rate, since so many people live car-free, and instead will charge a flat rate every month on top of rent for the space. It’s beneficial to both sides when done this way—if a tenant doesn’t want the space meant for them, they won’t have to pay the additional fee, and because parking is so scarce in the city, you’ll likely be able to find someone else who would like to rent the space, even if they’re not a tenant at your property.

Beyond collecting rent for the spaces, though, you’ll have a few other responsibilities with regards to parking, and as a property management company in Chicago, we at Lofty have some advice that can make landlording a bit more convenient for you. Here are our top tips about managing the parking at your Chicago investment property.

Double Check on Accessibility Regulations

If you’re purchasing a building that doesn’t have any handicapped-accessible parking spaces, you’ll want to check with local ordinances as well as with your Chicago property management company about whether you will need to rectify that situation immediately or if you can deal with it when it becomes an issue (i.e. when a tenant needs the space to be accessible). Some cities require 2 percent of parking lots at residential locations to be handicapped-accessible, which is why it’s important to check your building’s code requirements. Asking your property managers about this issue can be a quick fix—they’ll know local ordinances surrounding disabled parking requirements and can get the issue cleared up fast.

Maintaining the Lot’s Safety

When it comes to maintaining safety at your property, terms of your leases will determine who is responsible for shoveling walkways, but typically, the onus for ensuring parking lot safety falls on the landlord. Of course, this can be meted out to your property management company to take care of—that’s just one of many things that property management companies in Chicago will help out with at your properties. Tasks like regular shoveling and de-icing, repairing pot holes and cracks, and repainting space lines and other markings can all be handled by your property management company, so that you can spend your time doing work that is more important and pressing.

Know that Parking Issues at Your Chicago Investment Property Will Arise, Sooner or Later

Despite all your best efforts, at some point, you’ll likely have to deal with some form of parking issues at your building. Whether it’s the driveway being blocked or unauthorized vehicles taking up renters’ spots, you’ll have to rectify the situations quickly to keep everyone happy. In these sorts of instances, having a local property management company in Chicago to help you can be a lifesaver, especially if you don’t live nearby. They’ll be able to solve any problems at your rental property quickly and easily. They’ll have access to security teams as well as towing companies to help resolve any problems, so you can rest easy knowing that your tenants and building are safe.

 

How to Help Prevent Non-Renters from Parking In Your Spaces

Preventing non-renters from parking in your lot or spaces can be tricky, but often, all that it takes can be a few signs, placed in highly visible areas, warning that any unauthorized vehicles will be towed at the vehicle owner’s expense. In cities like Chicago, where a car getting towed can be an incredibly inconvenient ordeal requiring a long drive to the impound lot and a few hundred dollars in fines, these signs can be unbelievably effective—just make sure you follow through with them, since people realizing there is no risk of towing can lead them to keep breaking the rules.  

Consider Guest Parking Options

To that end, it can be beneficial to set aside a few spaces for guest parking, and giving tenants a placard to give to guests to indicate that the visiting car is allowed to park there. This not only cuts down on abuse of the shared spaces, but makes it easier for your tenants to have visitors over—creating happier tenants overall.  

Decide What to Do About Non-Operational Vehicles

To ensure that your parking spaces/lot are housing working vehicles and not just providing storage space for a car that doesn’t run, be sure to let tenants know that only operating vehicles are allowed to park in the shared lot or assigned spaces. This helps ensure that the lot is occupied by people who need parking for the cars they use, rather than taken up by people who simply want a cheap place to leave a vehicle (this is particularly true if a parking space is included in your rental rates).

 

Getting Help With Rental Property Parking in Chicago

When it comes to owning investment properties in Chicago and managing the different aspects of them, parking shouldn’t be something that causes you a lot of stress. If you want help with your parking setup at a property, working with a Chicago property management company can be a great asset. At Lofty, we strive to take the busy work off our investors’ plates so that they have time to do the other, often more important work they need to get done, and that includes everything related to managing the parking systems at your properties. We’ll manage finding tenants, parking area upkeep, fee collection, towing partnerships, and more, so that you can get back to living the life you deserve—after all, owning investment properties wasn’t supposed to be your full time job!

To learn more about how we help real estate investors’ manage every part of their properties, contact us today.  

Speak with one of our experts to find out how we can supercharge your investment.

 

Property Management Company Chicago

Way to Add Additional Security to Keep Your Tenants and Property Safe

By | Property Management

Whether you’re new to owning investment rental properties in Chicago, or you’ve been involved with it for many years, one issue that keeps evolving is the topic of security—how to keep both your tenants and the property itself safe. That can mean keeping it safe from intruders as well as protecting yourself from liability from tenants, and when you’re a landlord or property owner, it’s important to maintain secure buildings. Not only does it make your life easier, but it can save you money over time, particularly if you don’t have to replace or repair things that are damaged, stolen, or broken. As a property management company in Chicago, we at Lofty see the different ways that landlords and investors protect their properties, and we’re happy to pass the most helpful tips we’ve seen on to you.

Check Crime Stats Before Buying

Perhaps the biggest and easiest bit of advice to give is that before you commit to purchasing a property, check out the crime stats around it. What you do with the information will be up to you, but knowing what’s common around the area will inform you on how to protect tenants from potential problems. For instance, a slightly higher crime rate may be encouragement to set up security cameras/alarms, motion-sensor lights, or other security-increasing products.

Don’t be scared off by any crime appearing on a crime report though—the fact is that crime is unfortunately everywhere, but knowing about it will allow you to ensure your tenants and property is better protected.

Install Fixtures that Increase Safety and Security

Along that line, the biggest way to increase safety and security at your buildings is by installing various security measures:

  • Call boxes at the front door to allow guests to be buzzed in, rather than unlocked main doors that lead to locked apartment doors—this weakness in security is one too big to overlook, so if you’re not interested in a call box, at least make sure that the main entryway door is locked at all times.
  • Security cameras should be installed near entryways, bike racks, fire escapes (especially if they go all the way to the ground level and are easily accessed), and parking lots. These areas should be well lit, as well.
  • Motion sensing lights can be installed around entrances and other points on the property that need additional security, as well as parts of the bulding’s interior that aren’t frequented as often, like basement laundry rooms or storage areas.
  • Window bars can be installed on ground level windows for additional security. These can be decorative, as well—no need to worry about unsightly additions to your property.
  • Intercom systems can help prevent people who are strangers from being let in by well-meaning neighbors. This way, visitors can contact the party they’re visiting and gain access, but people with nefarious motives won’t be able to gain access—be sure to stress to tenants not to allow entry to unexpected visitors or strangers.
  • Alarm systems that will go off in the event of unauthorized entry, as well as visible signage detailing these systems’ presence can help prevent criminal activity.

 

Protect Yourself: Make Sure the Property is Well-Maintained

Beyond installing things that keep tenants safe, a way that you can ensure you are protected is by making sure that the property is well maintained and safe to patronize.

Check on things like whether doors and windows lock properly, whether staircases are safe, and whether common areas are secure—making sure of these things can help prevent you from being liable for issues like injuries, break-ins, or theft. If your investment property in Chicago is well-protected from crime and other safety issues, you’re set. Talking to your property management company can shed some light on the various ways you can increase security to protect both your tenants and yourself.

Use a Property Management Company in Chicago to Help Protect Your Building

One more way you can protect your property is by working with a Chicago property management company. Beyond simply advising you on ways to make your buildings more secure, they can dispatch any necessary contractors or response teams if a problem ever does arise.

Property managers will be able to offer their own tips for safety and security based on where your building is located, as well—different parts of the city may require different security measures. For instance, if you’re used to dealing with securing outdoor parking lots, but purchase a building in a part of the city that offers underground or covered parking, there may be steps to take that you might not think of. Property management companies have experience dealing with a wide range of property types, and will be able to offer you advice based on the specific property you have bought.

 

Getting Help from a Property Manager

Whether you’re gearing up to buy a new investment property, you just did, or you have a list of buildings you want some assistance with, a Chicago property management company can be a great help. At Lofty, our goal is to ensure that our investors and clients live the lives they deserve, and that means taking care of the everyday aspects of property ownership as well as bigger tasks like updating security at newly-acquired properties. From helping you find great tenants to contracting out installation of security systems and beyond, we’re dedicated to making sure you enjoy owning investment properties.
Contact us today to learn more about the ways we help investors in Chicago.

Speak with one of our experts to find out how we can supercharge your investment.

 

 

Upgrades to Avoid Doing in Your Chicago Investment Property

5 “Cheat” Upgrades to Avoid Doing in Your Chicago Investment Property

By | Property Management

Owning investment properties in Chicago is a great business to be in. Demand for rentals is high, and the inclination to do repairs and implement upgrades on your properties is understandably strong. Marketing the best property on the block takes work, and for some landlords, that has meant doing what some might call “cheat” upgrades. Cheat upgrades can simply be defined as work that seems like it will save time or money at the outset. However, these projects end up costing more and taking much more time to fix than they would have taken to do the job the “right” way the first time around.

With that in mind, we at Lofty want to help make sure our investors don’t make these mistakes! After all, it’s our goal to make your life easier, not more complicated. When it comes to upgrades and new finishings in your Chicago investment properties, here are five big ones you’ll want to avoid cutting corners on. Save yourself time, money, and frustration and get the job done properly the first go around—you’ll be glad you did.

1) Painting Over Wallpaper

DIY painting jobs are a great way to save money on updating properties, but one way you can cause more work for yourself is by painting over wallpaper. While some sites around the internet suggest there’s nothing wrong with this method, the truth is that sooner or later, that wallpaper is going to start peeling, and in addition to the seams of the wallpaper showing through the paint, you’ll then have to worry about what to do with the peeling paper. This can lead to a project that involves not only having to take down the wallpaper (usually with special tools to protect the underlying drywall), but having to sand the walls and repaint.
It’s best, if you don’t like the wallpaper in a property, to get rid of it before ever picking up a paint roller.

 

2) DIY Kitchen Renovations

Plenty of property owners attempt do-it-yourself kitchen upgrades with great success, but oftentimes, that can be attributed to luck. Attempting to hang cabinets on your own or purchasing pre-made sets of kitchen fixtures from big-box or hardware stores can save you some money, but if you wind up with a sloped or un-level cabinet or counter, or worse—a set of cabinets that don’t quite fit or work well with the space you have, and you have to start all over. Unless you’ve got considerable experience renovating kitchens, this is an upgrade that should be left to the pros.

3) Using an Overlay Coating to Fix Bad Concrete

Concrete floors and walkways can be a stylish option in modern buildings, especially ones with open-concept or loft-like styling. Whether they’re outdoors or indoors, concrete bases must be in great condition in order to benefit from decorative overlays. If the concrete at your building has any damage–cracks, chips, dings, or other problems, it can be tempting to simply install a concrete overlay system to cover up the problems, but you’ll quickly learn that that’s all it will be doing—covering up, not fixing, the problems.

Overlays are only as good as the base they go over. They are not meant to fix concrete that is in bad shape, and if you pour an overlay onto cracked or damaged concrete, you’ll merely end up with a cracked and damaged-looking overlay that you’ll then need to fix even further. That project will be much more labor intensive than it would be had the concrete been fixed before pouring an overlay.

 

4) Installing In-Unit Laundry Machines Without Proper Plumbing Help

A value-adding upgrade for rental investment properties in Chicago and many other cities is adding laundry machines to each unit. In-unit laundry is an amenity that can net you a significant amount more rent, especially if you’re renting to young families with kids—renters that need to do a lot of laundry. However, unless you’ve got plumbing expertise, this can be a job that can cause more damage that is expensive to repair. For instance, washing machines can leak to lower floors, and ventilation can be lacking, which can lead to mold growth on walls, in ceilings, and elsewhere. Mold can be an expensive problem to fix, and since it’s very preventable, it’s to your benefit to hire professionals to help install laundry machines.

5)  Replacing Interior Flooring On Your Own

Whether you’re installing tiling, vinyl flooring, hardwood floors, or laminate, you should enlist the help of a professional to do this job. Doing it yourself can seem like a great way to get the job done faster and more cheaply, but measuring mishaps, technique slips, and more missteps can lead to ruined materials, wasted time, and a huge headache. Plus, if these problems arise, you’ll end up hiring a professional to backtrack and finish the job. Instead of risking damage to costly materials and wasting a lot of effort, it’s best to consult with professional flooring contractors.

 

Get Help From Your Chicago Property Management Company

DIY projects can be cost-effective if you’re a property owner, but for some jobs, it’s best to leave things up to the professionals rather than try to cheat the system and get things done quicker and more inexpensively. As a dedicated Chicago property management company, we at Lofty work to ensure that property investors get the most ROI on their rentals in Chicago. Part of that means we’ve got a network of reliable contractors and home improvement specialists who will work on your building upgrades in an efficient way, making sure that the outcome is exactly what you and your properties need to earn great returns. Our goal is to take the busy work off your plate—sourcing contractors, scheduling projects, overseeing the progress, and everything in between—so that you can live the life you deserve and work on projects that are more pressing and important to you.

To find out more about all we can do to help you manage your Chicago investment properties, contact Lofty today.  

Speak with one of our experts to find out how we can supercharge your investment.

 

Neighborhood Guide: University Village

By | Neighborhood Guides

Say hello to University Village!

Facts

Sometimes referred to as Little Italy, this Chicago neighborhood is rich with charm, fun, and much more. Located on the Near West Side of Chicago, its boundaries are Ashland Ave. on the west, Interstate 90/94 on the east, the Eisenhower Expressway on the north, and 18th St. on the south.

It is home to the University of Illinois at Chicago.

Jane Addams’ Hull House was founded in University Village in 1889.

 

Food

There’s no shortage of great eats in this neighborhood. From brunch staples to great burgers to upscale Italian, you’ll find just what you want, no matter what you have a hankering for. Check out these hot spots as a perfect introduction to what people love most about this area.

1) Davanti Enoteca

1359 W Taylor St

This wine bar focuses on traditional Italian eats and small plates inspired by the chefs’ travels to the country. You won’t want to miss their specialties and crowd favorites, including the Truffle Egg Toast, anything utilizing ricotta, and the Riccio di Mare e Granchio, a linguini dish with sea urchin and crab.

2) Sweet Maple Cafe

1339 W Taylor St

This intensely popular brunch joint is a local favorite. It opened in 1999 and has been churning out standard but delicious breakfast, brunch, and lunch fare ever since, serving a diverse clientele. Family recipes and unique specialties make up this menu’s offerings, including popular items such as cheddar grits and corned beef hash. Pull up a chair!

3) Mario’s Italian Lemonade

1068 W Taylor St

A summertime staple, Mario’s Italian Lemonade offers shaved ice to happy customers day in and day out. Get it while it’s hot, though—literally; Mario’s is only open during the warm months.

4) Three Aces

1321 W Taylor St

Food and drink specials abound at this neighborhood hot spot. Featuring great burgers, a diverse beer selection, and craft cocktails, it’s a casual hangout that you’ll love stopping for. Fan faves include bolognese fries, the Ace Burger with aged cheddar, bacon jam, and all the trimmings, and duck fat chips.

5) Stax Cafe

1401 W Taylor St

Competing lines at Sweet Maple Cafe and Stax Cafe keep these brunch spots going head to head every weekend, and this local gem offers up mini waffles, chocolate chip bacon pancakes, and an entire menu that will have your mouth watering.

6) Joy Yee’s Noodle Shop

1335 S Halsted St

Bubble tea fanatics go wild for this eatery, which features a full menu of Asian signatures as well as a complex list of smoothie and slushy flavors that are available with or without the famous “bubbles.”

7) Jim’s Original Hot Dog

1250 S Union Ave

Whether you come here for a casual lunch or some post-bar noshing, Jim’s Original promises to hit the spot. It opened more than 70 years ago and has fast become a neighborhood icon. Find out for yourself why this long-standing hot dog stand is known for being one of the best.

8) Al’s Beef

1079 W Taylor St

Another gold-standard Chicago tradition, Al’s Beef has been cooking up Italian beef sandwiches and more since 1938. Here, get hand-cut fries, spicy giardiniera, or sweet peppers to accompany your lunch.

9) The Rosebud

1500 W Taylor St

Classic Italian in the heart of Chicago, this old-world eatery shows off the dishes you love. Calamari specialties, veal or chicken parmesan, a host of pastas, and a delectable wine list means no one will be going home hungry.

10) County Barbecue

1352 W Taylor St

If you’re looking for a meat fix, you’ve found it here. Diners love their pulled pork, corn pudding, and garlic fries, but you can also sample fried chicken, ribs, hot links, brisket, and you can choose from an extensive beer and bourbon list to wash it all down.

Drink

If you’re looking for a nightcap, a great date place, or just a comfortable hangout for friends, this neighborhood has something for everyone. These are some of the most popular watering holes in the University Village area. Do you have a favorite that we missed? Let us know about it!

1) Ph. D. Pub

1257 S Halsted St

You won’t want to miss this pub’s beer garden when it’s nice out. A casual bar frequented by students and locals alike, Ph. D. pub has something for everyone.

2) Cetta’s

1358 W Taylor St

Slink on into this wine bar and piano lounge and enjoy a fine vintage over candlelight. Perfect for a date or just a great glass of red, you’ll love living near this spot.

3) Drum & Monkey
1435 W Taylor St

No neighborhood is complete without a bustling Irish pub, and we’d be remiss to omit this watering hole. Free shuffleboard, drink specials, and tater tots make this place worth a visit (or three).

4) The Bar 10 Doors

1259 W Taylor St

Casual and inviting, this affordable bar and lounge offers up drink specials every night, plus live music and theme nights. College students and locals alike flock to this establishment, and we can see why.

5) La Taberna Tapas on Halsted

1301 S Halsted St

Get your tapas fix at this small-plate spot. Featured bites include patatas bravas, olives, charcuterie, and more, and don’t forget to order a sangria flight!

 

Parks and Points of Interest

You’ll need more to do than just eat and drink, of course, and thankfully, Little Italy is home to a lot of great cultural institutions, green outdoor space, and more. Take a stroll around the neighborhood and visit these top picks.

1) Sheridan Park

910 S Aberdeen St

Featuring an indoor swimming pool, gymnasium, baseball fields and more, Sheridan Park is a perfect place to spend a day with the whole family. Sheridan Park also offers Movies in the Park events during the summertime—a citywide favorite.

2) Piazza DiMaggio

1437 W Taylor St

Perfect for the sports fans in your life, this statue of the late, great Joe DiMaggio is surrounded by beautiful views of the city. Get an iced coffee nearby and stroll through on a sunny afternoon.

3) Maxwell Street Market

On Des Plaines St. from Roosevelt S. to Harrison St.

Want to get a feel for the neighborhood? Stop by the Maxwell Street Market on Sundays and check out local food vendors, plus furniture, clothing and collectibles. Spend all day browsing, and if you run out of time, don’t worry—there’s always next week!  

4) Notre Dame de Chicago Church

1335 W. Harrison St.

This landmark church is known for its architecture and is also regarded as the “best extant landmark associated with the French in Chicago.” Its beauty and size make it hard to ignore.

5) Jane Addams Hull House Museum

800 S. Halsted St.

Learn more about Jane Addams’ renowned project, Hull House, and what it accomplished during its time. With affordable admission and group rates available, this museum is a Chicago landmark.

6) UIC Pavilion

525 S Racine Ave

This 9,500-seat arena is perfect for checking out the biggest acts of the minute, plus rallies, sporting events, and more. The UIC Pavilion is home to the University of Illinois at Chicago Flames basketball team and is also home to the Windy City Rollers Roller Derby League.

7) National Italian American Sports Hall of Fame

1431 W. Taylor St.

Celebrating 35 years of Italian athletes, this is the perfect place to visit for any sports fan. Rotating exhibitions and galleries keep this place current and focusing on the latest and greatest.

Schools

No more teachers, no more books—wait, wrong list!

University Village is named as such thanks to the University of Illinois Chicago campus’ location. It’s also home to other schools, including a college prep academy.

1) St. Ignatius College Prep

1076 W Roosevelt Rd

Founded in 1869, this private Catholic school has a broad curriculum focused on preparing students for their futures in higher education. It has an enrollment size between 1,300 and 1,400 students as of 2011, and is known for outstanding teaching and a focus on service and leadership.

2) University of Illinois at Chicago
1200 W Harrison St

Known as UIC for short, this public, four-year university is the largest university in the Chicago area with a student body of about 29,000 people. Established in 1858 with larger expansions coming in the 1940s and 1960s, this university is a branch of the University of Illinois, which has two other campuses in Urbana-Champaign and Springfield. It is ranked the 78th best public university in the nation, and is tied for 51st-75th in the area of social sciences.

Transportation

Your new neighborhood has a lot to love, but part of the reason so many people choose to live in Chicago is its rich cultural landscape, full of different sights, sounds, smells, and more. When you’re ready to duck out of your usual corners, here’s how you can do it.

The CTA’s UIC-Halsted stop on the Blue Line trains will take residents and students most anywhere they need to go, via line transfers or connecting buses.

 

Surrounding Areas

Bordering areas include West Town, Pilsen (including Chicago’s Chinatown area), and the West Loop, all lively areas with plenty of options for dining, entertainment, shopping, and more. Ease of traveling to other neighborhoods and a rich history make University Village a place worth calling home!
Thinking about purchasing or renting property in University Village? Contact Lofty today to get more information!

Speak with one of our experts to learn more.

 

Inexpensive Landscaping Tips to Get Your Rental Investment Property Spring-Ready

Inexpensive Landscaping Tips to Get Your Rental Investment Property Spring-Ready

By | Property Management

As an investment property owner, springtime can be a big money-making season as many leases turnover and you market your building to new prospective renters. While we all often think of the interior as the big sell—because it is—the exterior of your investment property is important, too. As a property management company in Chicago, Lofty is committed to giving the best advice to investors and landlords about how they can find the best tenants and make the most money on their properties, and finding the best ways to improve building interiors as well as exterior spaces is one of our specialties. Inexpensive landscape updates and maintenance tips that can increase the curb appeal of your property is something we’re very familiar with. In Chicago, people relish winter’s end and look forward to seeing green grass, blooming flowers, and lush shrubbery lining the streets. Here are some great ways you can increase the appeal of your properties without breaking the bank.

Clean Out Gutters, Wash Windows, and Power Wash the Exterior

Cleaning is the first step you can take toward making any space look better. First, clean out the gutters and remove built up leaves and other debris from the cold seasons.

Next, clean the windows—this can instantly give the facade a lift, making things look brighter and better in just minutes.

Finally, cleaning off the exterior of the building will make a huge improvement in the way the building looks. Renting a power washer is relatively inexpensive, and if you’ve got siding or sidewalks that look a bit worse for the wear, pressure washing is a quick job that can help remove built-up grime on the exteriors, which will make your property look sparkling new.

Aerate and Re-Seed the Lawns

The lawns (both front and backyards) should be tended to at the turn of the seasons, also. Aerate and re-seed them for optimal growth, and be sure to work with lawn maintenance companies or your Chicago property management company to set up a schedule to ensure they keep looking their best all year. This is especially important if you lay down any sod, as it will need regular maintenance to avoid withering away. Having a bright green lawn and a clean building exterior are a quick and easy project, and they make a huge impact toward how your property looks.

Clear Away Dead Plants

You don’t want your building to have dead, dried out old plants sitting out front. This is a another quick fix that helps project the concept that an attentive building owner is taking care of the place.

Clear away all of the plants that are dead from the winter, pluck the dead roots out of the planters if they’re not perennials (and possibly even if they are—creating a low maintenance landscaping plan that doesn’t require you to constantly replant might be a better option). Your property management company can give you a hand with this, too—maybe you live far away and don’t have the time to do it, or you simply have too many other projects on your plate at the moment. Whatever the case may be, your propert managers can take care of it, utilizing skilled landscapers that can transform even the deadest, most gnarled garden into a beautiful work of art.

Replace Grass with Mulch in Walkways

If you’re looking for a way to lower the amount of upkeep required at your properties, replacing plants and grass on walkways with mulch can be a good idea. You’ll need to first dig out the space for the pathway several inches. Then, install plastic edging as barriers so that the mulch stays within its intended space—leave the edging a half inch above the ground. Next, lay down three or four inches of crushed rock or stones, as this will encourage drainage when the mulch gets wet. Finally, lay down the mulch of your choosing, and to help compress it into place, spray it lightly with water and tamp it down. Voila—a mulch pathway that requires almost no maintenance like a grass one would.

Instead of Expensive Flowers and Trees, Plant Low-Maintenance Shrubs

While flowers look bright and lively, the hard truth is that they just die too quickly. In addition, they’re expensive to buy, plant, and maintain, and the end result is often starting over from scratch the following year. We know most people don’t have time for that. In a similar vein, planting trees may seem like a great idea, but trees are an expensive investment, particularly if you have several properties to upkeep. Additionally, there’s no guarantee that the trees will root and thrive where you plant them, and if they don’t, you’re back to square one. Instead of flowers or trees, we often suggest property owners in Chicago plant low-maintenance shrubbery outside their buildings. Not only does shrubbery look great, but it’s very low maintenance and is known to withstand a lot of harsh weather. Plants like arbor vitae are great for Chicago properties, and landscapers will have other great tips for which plants and shrubs will stand up to the unpredictable Midwest weather.

Need Help Getting Ready for Spring?

When you need help preparing your properties for the upcoming season, we can help. Here at Lofty, we strive to offer investment property owners the help and guidance they need to see the most return on their investments. You already know about what you need to do during wintertime at your property, but as far as springtime upkeep, we’re proud to be working with the best landscapers, gutter cleaners, and more, and we’ll take care of all the details so that you can get back to doing things you want to do. As a property management company in Chicago, our goal is to take the stress and busy-work off your plate from investment properties so that you can live the life you deserve. If you’re ready to learn more about how we can help you enjoy your investments more, call us today.

Speak with one of our experts to find out how we can supercharge your investment.

 

what does landlords insurance cover

Landlord Requirements for Emergencies and How Property Management Can Help

By | Property Management

Whether you’re a seasoned landlord or you’ve just recently gotten into the world of investment properties, emergencies at your rentals are always going to come as a hectic surprise. Whether it’s just a small kitchen fire or something much more serious, you can help ease the shock by being prepared—knowing who to call, what you’re responsible for, what your insurance will cover, and more. Having a good grasp on the ins and outs of how to manage and deal with an apartment or condo emergency in your Chicago rental units can save you a lot of time, money, and frustration.

“Who You Gonna Call?”

Unfortunately, the Ghostbusters won’t be able to help you when one of your tenants overflows the bathtub into the unit downstairs, a refrigerator stops working, or a fire breaks out at one of your properties. Instead, you’ll want to have a list at the ready of on-call emergency response companies who can help out at your Chicago rentals. From fire mitigation services to roofers, electricians to plumbers, build up a list of trusted vendors who can solve the problems that always seem to happen at the most inconvenient times. Work with your property management company to determine which companies will be the most beneficial for your properties.

 

What Are You Responsible For?

If the emergency happens as a direct result of ignored or neglected repairs, such as a leaking roof that eventually collapses or an electrical fire due to faulty wiring, you can find yourself liable for a lot of damages. You should stress to your tenants to carry renter’s insurance, though, because damages caused by emergencies are typically not covered by the landlord’s insurance policy.

That being said, there are some things that you may be held responsible for, regardless of the cause of emergency, in addition to preventative measures. In terms of fire prevention, you’re required to provide a rental that is up to fire code, including having working smoke alarms in each room. Beyond that, you are required to get the rental unit back in living order following a fire, but your insurance company will most likely not cover any of your tenant’s losses. For that reason, to avoid any uncomfortable surprises, you should encourage your tenants to have renter’s insurance.

Floods are a different ball game: the landlord will typically have to have a separate policy for flood insurance, and it will be up to the tenant to find out if their renter’s insurance policy covers flood damage—many do not.

Whether you choose to compensate your tenants for finding alternative housing in the event of an emergency is up to you—some landlords will give their tenants the amount of daily rent (total rent cost divided by 30, multiplied by how many days the tenant can’t stay at their apartment), while others will simply offer to cover the cost of a modest hotel/motel during the clean-up or repair time. If you’re stuck on what you think you should offer tenants, your property management company can help advise you based on previous situations they may have had experience with and what will be best for your tenant-landlord relationships.

 

What Does Your Insurance Cover?

You probably already know by now that homeowner’s insurance is different from landlord’s insurance. If you didn’t know that, well, it’s time to get your policies changed. Landlords are usually required to carry greater liability against property damage, and these policies will also cover you in the event that your property becomes uninhabitable. Landlord’s insurance will also cover you in the event of lost income due to an uninhabitable property, whereas homeowner’s insurance would not (however, it should be noted that you can only be compensated for lost income due to emergency, not vacancies).

How Can Property Managers Help With Emergencies?

Beyond helping you compile a list of companies to call in the event of an emergency, property management companies can also coordinate with you and your insurance company in the event of an emergency, work with your tenants to resolve any residual issues from emergencies, and manage the aftermath of emergency clean-up and repairs. Working with a reputable property management company will mean that a majority of the hassle surrounding something going wrong at one of your Chicago rentals will be taken off your hands.

Finding Reliable Help for Your Chicago Investment Properties

If you’re tired of spending all of your time focusing on your investment properties and not enjoying any of the benefits of owning it, it might be time to get help. Here at Lofty, we believe that owning investment properties shouldn’t be your full-time job, and in order to help you live the life you deserve, we manage all of the busy work related to maintaining your properties as well as managing your tenants’ expectations and needs. If you’re ready to start enjoying owning your properties more, contact us today.

 

Speak with one of our experts to find out how we can supercharge your investment.

 

 

what should you offer tenants in an emergency

Why You Need 24/7 Maintenance and Emergency Response for Chicago Rentals

By | Property Management

As a landlord or investment property owner, it can be easy to slip into the idea that your job is a relatively easy 9 to 5. Screening tenants, helping with move-ins, and answering the occasional phone call about a leaky faucet isn’t too stressful a situation to be in, and if that’s been your experience so far, count yourself as lucky. For many property owners and landlords, the job can get pretty hectic, almost to the point that it can feel like a second full-time job—not ideal in any sense. Owning investment properties can be very rewarding, but the reality is that sooner or later, a tenant is going to have a problem at an hour that you absolutely won’t want to work during—a roof collapsing and flooding a unit after a heavy rainstorm in the middle of the night or a broken heater on the coldest, snowiest Sunday of the season, for instance. If you don’t have maintenance contractors on deck who are available to work 24/7, you may find yourself in a sticky situation of having to call around until you find one—and that can be a lengthy, often fruitless endeavor that leaves both you frustrated and your tenant upset. Here’s how you can avoid that happening.

Call Chicago Maintenance Companies Ahead of Time

There’s nothing worse than having a problem on your hands and have no solutions or prospect for help on deck. That’s why, when you invest in a property, it can be beneficial to start reaching out to companies that offer the services you’ll eventually need—plumbers, HVAC specialists, general handyman-type services, etc. Establishing a relationship with these businesses and getting them on your roster early can ensure that when the time comes to deal with a problem, you’re prepared. If you’re worried about how to make sure that you’re choosing the best workers—companies who are available at a moment’s notice, who charge a fair price, and who do reliable work—working with property managers can be a great help. Often, property management companies will have a list of these companies that they’ve worked with who have proven themselves to be worth having around.

What Types of Emergencies Should You Plan For?

Emergencies are, by nature, unexpected events that require immediate attention, but there’s still a little bit of planning you can do to be prepared for certain things. Some of the most common emergencies that occur in rentals include break-ins, fires, broken heaters, wiring issues, and plumbing problems. While a break-in can’t really be remedied by calling a contractor to fix things after it happens (if only!), you can help prevent burglaries by installing deadbolts and window locks. Fires can be mitigated by ensuring that smoke detectors are working and fire extinguishers are accessible, while heating issues and plumbing problems will have to be dealt with, unfortunately, after they happen. With this knowledge at the ready, though, you can compile a list of helpful contractors who will be able to assist after an emergency occurs.

A starter list of who you should have on deck for maintenance and emergencies for your Chicago rentals should include:

  • Plumbers
  • HVAC specialists
  • Fire restoration specialists
  • Electricians
  • Window companies (in case of broken windows)
  • Locksmiths

What Can Go Wrong If You’re Unprepared?

If you don’t have contractors ready to help when something goes wrong at one of your properties, you can find yourself dealing with not only unhappy tenants, but problems that can become larger and larger as time goes by—for instance, a broken pipe overnight that can’t be tended to until morning can lead to damage to floors or walls, or even problems with surrounding units, such as if water seeps through floors and down through the ceiling of a unit below. Problems compounding is the last thing you’ll want to deal with, so it’s best to be prepared and ready to go in case of emergency.

What Should You Offer Tenants in the Event of an Emergency?

If one of your tenants has an emergency at their rental unit, you’ll want to find out if they have renters’ insurance, particularly if the emergency is related to a fire or flood (events that cause a lot of damage to their personal items). While you are usually not required to provide housing assistance if the emergency makes their place uninhabitable, you may want to check with local laws—if the emergency was caused by a repair that was neglected, you may be on the hook for covering costs for your tenant to either stay in a hotel or relocate entirely.

If the emergency is not affecting your tenant’s housing status, but is creating a significant inconvenience (such as an unheated apartment in the dead of winter), you may want to consider knocking off a sum of money from the following month’s rent. This isn’t totally necessary, but if the tenant had to find somewhere else to stay for a couple of days, the break on rent will be much appreciated (if not required by law).

Be sure to outline in the lease what you will and will not cover expenses for in the event of an emergency. It can be a good idea to encourage tenants to carry renter’s insurance so that if something does happen, they’re not stuck recouping expenses—which can then cause them to be late on rent.

Getting Help with Your Rental Properties in Chicago

Making sure that you and your tenants are both covered in the event of an emergency doesn’t have to take up all of your time. If you live far away from your investment properties or just want a way to make owning your rental units easier, working with a Chicago property management company can be a great help. Here at Lofty, we know that your time is valuable, and that’s why we do everything we can to take the busy work off of your to-do list so that you can live the life you deserve, including maintenance, emergency repairs, helping with tenant relationships, and more. If you’re ready to start enjoying owning your investment properties more, call us today to learn more about all we do.

Speak with one of our experts to find out how we can supercharge your investment.

 

Keeping Your Rental Property’s Drains in Great Shape: What to Do (and Not Do)

By | Property Management

 

It doesn’t matter if you own your house or rent an apartment—drain care is important. It’s not the most fun topic to talk about, but unless you want to deal with calling a plumber at the least opportune time (because, as we all know, nothing ever breaks when it’s convenient), it’s essential to make sure you’re doing everything you can to make sure your drains keep doing their job. As a property management company in Chicago, we have discovered quite a few pro-tricks when it comes to drain maintenance. Here are our top tips for keeping drains healthy no matter where you live.

How to Prevent Drain Clogs

You might not think that drain care and sports have much in common, but you’d be wrong. As the old sports saying goes, the same can be said for your drains: the best offense is a good defense. In other words, it’s easier to prevent drain issues from happening than it is to remedy them after there’s already a problem. Preventing drains from becoming clogged is relatively simple. Keep a drain protector or drain screen over your drains in the shower to prevent hair from going down the drain and collecting, and in your sinks, be sure not to pour down anything that could be considered damaging down them.

What Not to Pour Down Drains

Sometimes, people think that even without a garbage disposal, some products are fine to rinse down the drain. That’s unfortunately untrue, and if you continually rinse certain things down the drains in your home, it’s only a matter of time before you run into a problem. Sewer pipes can become clogged with grease and cause overflows and backups, which can be very expensive—not to mention a big hassle—to remedy. In the kitchen, make sure not to rinse these products down the drain, as they can cause grease clogs:

  • Cooking oils
  • Used frying oil
  • Shortening or lard
  • Dairy products
  • Sauces
  • Meat fats

 

Additional products that can cause big problems with drains include:

  • Motor oil
  • Coffee grounds
  • Eggshells
  • Stickers from produce
  • Paper towels
  • Cat litter

Overall, if you can put something in the garbage instead of rinsing it down the drain, do that—erring on the side of caution is never a bad thing when it comes to drain health.

How to Fix Slow Drains

Unfortunately, you may sometime have to deal with slow-draining sinks or showers. Before you call your landlord or a plumber, you can try some at-home remedies. The first one isn’t pretty, but it’s a lot cheaper and quicker than calling in a professional. You’ll need some tweezers and rubber gloves, and you’ll want to try and pull whatever is causing the slow drainage out—usually, it’s stray hairs and dust buildup with soap scum mixed in—like we said, it’s not a pretty job. If that’s not helping, you can try doing a natural “drain volcano,” which uses a chemical reaction to break up forming clogs. To do this, you first pour one cup of baking soda down the drain, followed by one cup of white vinegar (slowly—if you pour too quickly, you’ll just rinse the baking soda down the drain. Then, let the mixture of baking soda and vinegar sit and bubble for about five minutes, then rinse it all down with one gallon of boiling water. The boiling water helps flush out anything that might have been collecting in the drain. If this doesn’t work the first time, you can try it again.

It’s important to note that if you’ve already used a commercial drain cleaner, you shouldn’t use the vinegar-baking soda method, as commercial drain cleaners can contain certain chemicals that, when mixed with baking soda and vinegar, can create toxic fumes.

While we’re talking about it—should you even be using commercial drain cleaners?

The Case For (and Against) Commercial Drain Cleaners?

While many drain cleaners at the hardware store do in fact clean out your drains pretty well, there can be big downsides, and these downsides can cause major, major problems in your building. Especially if the building is older, using commercial drain cleaners can completely ruin your home’s pipes. That’s because the main ingredient in many commercial drain cleaners is hydrochloric acid, and when left sitting inside drains, it can eat away at not only the pipes, but other finishes in your bathroom and kitchen, such as enamel or metal sinks. Additionally, the fumes from these products can be irritating to toxic—they’re not something you and your family should be breathing in. Worst of all, they may not even work, despite being made of very harsh chemicals. Then, you’re stuck with damaged pipes, toxic fumes, and a drain that’s still clogged.

Instead, you can try a drain snake or a drain plunger first. If these don’t work, it’s time to move onto more intensive repair options.  

When It’s Time to Call Your Landlord or a Plumber

Plumbing in homes and apartments are like the roots of a tree. There’s one main line, and each room’s plumbing can be considered a “branch.” If, for example, your sink is slow to drain, but everything else is fine, it’s just the sink’s pipes that are clogged. However, if the sink is clogged, but nothing else will drain either, it’s likely a main line that’s clogged. In either instance, if you can’t solve the problem with a gentle drain cleaner (vinegar and baking soda) or some simple tools, it’s best to contact a professional plumber. They’ll be able to solve the problem quickly and safely, and you’ll be rid of the problem in no time.

If you’re a renter, you should call your landlord if there’s drain trouble plaguing you. You may be held liable if you cause any damage to the pipes with do-it-yourself methods, and keeping healthy plumbing systems is part of what a landlord’s requirements are.

 

Don’t Want to Deal With Plumbing Issues at Your Tenants’ Homes?

While ignoring your tenants’ requests about fixing plumbing problems is the easy option, it’s not exactly ethical or legal. If you own a lot of investment properties, or you live out of the city your properties are in, dealing with plumbing issues can wind up taking you a lot of time. If you’re tired of spending your time making phone calls to plumbing companies at all hours of the day, night, and weekend, and traveling to your properties to meet with plumbers and tenants, it might be time to look into getting some help from a property management company. They have the time, availability, and desire to take the small tasks off of your plate so that you can do more important things.

At Lofty, we believe that owning investment properties should be satisfying, not frustrating, and we’re committed to doing everything we can to ensure you get to live the life you deserve. To find out more about how we can help you with plumbing issues at your properties, contact us today.  

Speak with one of our experts to find out how we can supercharge your investment.

 

where to eat wheeling

Neighborhood Guide: Wheeling

By | home buying, Neighborhood Guides, Property Management

Welcome to the town of Wheeling!

FACTS

Wheeling was home to the video game company Jaleco USA and to the American branch of Taito Corporation.

Some notable residents include:

Actor (Bones) John Francis Daley; opera singer, Deborah Voigt; singer/songwriter and comedian, Haley Reinhart.

EATS

Bob Chinn’s Crab House
393 S. Milwaukee Avenue
A Wheeling institution since 1982. For over 30 years they have been serving some of the freshest seafood from locations around the globe like Alaska, Hawaii and New Zealand. While seafood is their specialty, Bob Chinn’s is also known for their wet-aged prime steaks that are comparable to some of the best steakhouses in the suburbs and Chicago.  

Saranello’s
601 N. Milwaukee Avenue
Inspired by Executive Chef, Mychael Bonner’s Italian travels, the menu features a broad selection of Italian fare, utilizing the freshest ingredients to create the fullest flavors! They bring homemade, hand-crafted pizzas and pastas, as well as prime steaks and fresh fish dishes to the table. Enjoy the casual atmosphere while dining in a rustic setting.

Superdawg
333 S. Milwaukee Avenue
What started out as a hot dog stand in 1948 has grown into the old-fashioned Chicago-style hot dog mainstay, and one of the few remaining places offering carhop service! There is also a diner-style inside seating area, for those that prefer not to eat in their car.

Joe’s Pizzeria
57 N. Wolf Road
Family-friendly parlor known for its signature thin-crust pies and other Italian specialties, since 1966.

Tortorice’s Pizza
217 W Dundee Rd
While technically in Buffalo Grove, don’t let the funny name fool you—the folks here take pizza seriously. One of a handful of family-owned locations throughout the Chicago area, Tortorice’s is truly a magnificent ode to pizza. Take your New York visitors here for the Chicago-style deep dish and watch them melt like buttah.

The Original Granny’s
831 W. Dundee Road
A warm, inviting, neighborhood gem serving hot and tasty breakfast items. Come hungry, leave happy!

Tuscany
550 S. Milwaukee Road
Neighborhood Italian venue featuring pasta dishes & wood-fired pizza in a bright space.

Chicago Bagel & Bialy II
260 S. Milwaukee Avenue
Longtime homemade bagel specialist with outdoor seating featuring breakfast, lunch & deli items.

Rammy’s Sub Contractors
834 Wheeling Road
With owner, Mike Hrametz’s background in construction and studies in food service, he came up with a concept that was like no other. The Rammy’s Sub Contractors brainchild is a unique, construction-themed shop that serves unbelievably great food.

DRINKS

PS Pub
771 W. Dundee Road
Their extensive beer list includes a large selection of imports and domestics, while boasting their craft beer selection. They offer 12 lines of craft beers that are constantly changing. Also on the drink menu are an eclectic selection of shots. Don’t see one you like? The bartenders are happy to make a drink according to your recipe. Also featured are video slots, open mic Wednesdays, karaoke Fridays and live bands on Saturday.

Old Munich Inn
582 N. Milwaukee Avenue
Authentic German dive bar serving cold beer and cocktails only. Occasionally a tray of lunch meat and bread gets passed around to help soak up the drinks being consumed.

Spears
723 N. Milwaukee Avenue
Bourbon and beer drinkers unite. Enjoy cocktails prepared by incredibly knowledgeable bartenders who know all about the process of making, mixing, and drinking your next high quality beverage. Spears has American roots where the best Bourbon, Burgers, and Beer meet and await to delight you!

The Ram Restaurant & Brewery
700 N. Milwaukee Avenue
Brewpub chain featuring rotating house beers & easy-going American grub in family-friendly environment.

Cooper’s Hawk
583 N. Milwaukee Avenue
Combines a working winery, a tasting room and an upscale casual restaurant serving New American fare paired with house-label wines in a contemporary setting.

PARKS AND INTERESTS

Community Recreation Center (CRC)
333 W. Dundee Road
The CRC is open to the public and houses most Wheeling Park District programs including preschool classes, camps, arts and crafts, sports, adult and youth classes, indoor walking/running track, Arctic Splash indoor pool, Fitness Center, and the Guest Service Desk.

Arctic Splash
333 W. Dundee Road
A family friendly indoor pool that features a zero-depth leisure pool, Petie the Polar Bear toddler slide, mini lazy river, four lane – 25 yard lap pool and interactive water structures.

Family Aquatic Center
327 W. Dundee Road
The place you want to be during the summer months! A family friendly seasonal outdoor pool featuring Tsunami Splash (a water playground with large tipping bucket), Lily Pad Lagoon (a splash pool with water basketball and monkey bar activity pad), Volcano Valley (tube and body slides), Paradise Falls (two drop slides), Willie the Whale Toddler Slide, Aloha Beach (zero- depth entry main pool), lap lanes, Kona Courts (sand volleyball), grassy tanning area, Willie’s Coconut Café, a picnic area, diving board and Keiki Island (sand-play area).

Heritage Park
222 S. Wolf Road
Covering 97 acres, Heritage Park is the largest park the Wheeling Park District maintains. Encompassing the CRC and the Aquatic Center, the park has five baseball/softball fields (one with lights), tennis courts, soccer fields, play equipment, and a running/walking/bike path. There are shelters, picnic tables, drinking fountains, and an ice skating rink set up during the winter months. The park can be accessed from Wolf Rd. or via the CRC.

Husky Park
1100 Lee Street
Various slides and climbing apparatus, as well as swings and individual play pieces, accommodate both two- to five-year-olds and five- to 12-year-olds.  The individual play areas are sheltered by sail-like shade structures. The soft safety surface is constructed in circular shapes with contrasting colors.  The old basketball court was removed and replaced with a larger, full-court. Bike racks, new trash/recycling receptacles, and landscaping were added.

Chamber Park
251 N. Wolf Road
This park consists of 13 acres and is home to the Chamber Church, Carriage House, and the Wheeling Historical Society Museum. The church is said to be the second oldest church in Wheeling and as recently as the 1970s held services on Sundays. The Carriage House was moved to the park in the 1980s and the Museum was moved from Milwaukee Road., where it served as the original Wheeling police station. In the 1970s, the park had an outdoor and “kiddie” pool, shuffleboard courts, a large fountain, and an ice skating rink. Today, Chamber Park boasts play equipment, picnic tables, a sheltered gazebo, a dedicated flower garden area, and basketball hoops for informal play. The park also hosts Santa and Mrs. Claus when they come to town every December for Lollipop Lane.

Chevy Chase Golf & Country Club
1000 N. Milwaukee Avenue
A championship, 18-hole golf course set amid rolling greens and grassy fairways proves a challenge to players of all skill levels. Play a peaceful round early on a weekday morning, compete in a fun-filled scramble, or join a league to make new friends.

To meet your needs, golf carts come with GPS and provide a full-service golf shop stocked with brand name clubs and apparel. Finish your game at our 19th  hole, the Gable Room Bar & Grill, for delicious food and cold drinks.

HIGH SCHOOLS

Wheeling High School
900 S. Elmhurst Road
This high school boasts a culturally diverse student body, and draws its strength from embracing the rich multicultural community of students and staff. Wheeling High School is a four-year, comprehensive, public high school that offers all students a 21st century focus in STEM (Science, Technology, Engineering, and Mathematics). US News and World Report recently recognized Wheeling as one of the best high schools in the state of Illinois.

Buffalo Grove High School
1100 W. Dundee Road
Buffalo Grove High School is recognized as a Blue Ribbon High School by the U. S. Department of Education and was named one of the top high schools in the country by U.S. News and World Report and Newsweek magazines. In addition, Chicago magazine most recently named Buffalo Grove as one of the top 20 high schools in Cook County in the state of Illinois.

TRANSPORTATION

The Metra

The North Central Service line Wheeling stop is located at 400 Town Street. The northern most stop is Antioch and southernmost stop is at Union Station in Chicago.

Proximity to Downtown

Obviously there is a bit of fluctuation depending on where exactly you live within the city, but Wheeling is approximately 30 miles from Chicago’s Downtown Loop. Driving (without traffic) would yield about 40 minutes taking I-90 East. If traveling via the Metra, allow approximately 55 minutes.

Airport

Chicago Executive Airport, a busy general aviation airport, is located in Wheeling and Prospect Heights and jointly run by both villages. Formerly known as Palwaukee Municipal Airport, it is the third busiest airport in Illinois, after Chicago’s O’Hare and Midway airports.

Surrounding Areas

Buffalo Grove, Prospect Heights, Arlington Heights and Northbrook are your closest neighbors. These cities, while close in proximity, each offer unique vibes and help to make the Chicago suburbs a great place to live or visit!

what to do when your tenant stops paying

What to Do When a Tenant Stops Paying Rent or Wants to Break Their Lease

By | Property Management

As a landlord, you can do everything in your power to make a situation agreeable for a tenant, but the unfortunate reality is that sooner or later, you may find yourself facing a tenant who has stopped paying rent for some reason, or who is asking to get out of their lease early. Both of these situations are problematic for a variety of reasons, and the eviction process can be a nightmare for everyone involved, so it’s best to try and resolve problems if you can. If you can’t come to a compromise that works for everyone, though, you do have rights as the landlord. If you’re dealing with unpaid rent or an unhappy tenant who wants to leave before their lease is up, we’re here with some helpful advice.

What to Do When Your Tenant Stops Paying

It can be disheartening if, after all of your screening processes, you wind up with a tenant who stops turning in rent checks. Of course, a day or two late is understandable—we’re all human, after all—but when weeks or even months drag on with no payment coming your way, it’s time to take action.

Most tenants will be open to having a conversation about why they aren’t paying on time. Perhaps they were hit with an unexpected medical emergency and the accompanying bills, or they got into a car accident and have had to cover those expenses. Maybe they lost their job or are going through a divorce. There is usually a reason that people stop paying rent—most tenants aren’t simply neglecting their responsibilities and going out partying every night.

However, whatever the reason, the bottom line is that your bottom line is suffering. Have a sit down talk with your tenant and find out what’s really going on. Once you’ve heard their side of the story, you can make a decision about what to do.

 

Should You Evict or Negotiate?

Eviction processes can be complicated, expensive, and drawn out. If you haven’t been through the process before, you’ll want to be aware of what you’re getting into before you start down that road.

The Eviction Process in Chicago

If you decide to evict a tenant for non-payment, you must first notify them that you plan on starting the eviction process if they do not pay within a certain amount of days. If they don’t pay, you can then begin the eviction process. Eviction lawsuits must be filed in the same county that the property is located in. Once you do, the tenant will then receive a court summons and a court date. If they intend to fight the eviction, they will have to appear. If they appear in court, they’ll have to detail why they are fighting the eviction. There are a number of reasons that a tenant can fight their eviction, and if the case is over unpaid rent, they may choose to bring up issues of damage or lack of maintenance as a reason for the nonpayment—you will want to have any communications between the tenant and yourself on hand to prove that lack of maintenance is not the issue.

Due to the length of time that these proceedings can take—anywhere from five weeks to three months, assuming there are no delays—many landlords choose alternative methods for dealing with nonpayment. The most common alternative is negotiating with the tenant to figure out a smoother transition.

Common Negotiation Options  

Instead of evicting tenants, some landlords choose to work out a solution that involves paying the tenant to move out so that the apartment can be re-leased sooner. Often, the reason a tenant isn’t paying and won’t vacate is because they can’t afford movers. While it’s understandable to sympathize with this plight, the reality is you aren’t obligated to provide charity to non-paying tenants. If you’d prefer avoiding a court case and want the unit vacated, you can consider working out a deal to pay for the tenant’s moving fees so that they can leave sooner. This is sometimes the best case scenario—while you are paying a tenant to leave, a flat fee can work out to be less expensive than taking them to court and evicting them over months of unpaid rent.

You can also work out a payment plan if the tenant thinks they can get back on track relatively soon—whether you want to explore this option has to do with the reliability of the tenant and whether you can trust that they will actually catch up, and how they can prove to you that they can be trusted—documentation of a new job, for instance. This can be a risky choice, because if they turn out to be untrustworthy, you’re back at square one with unpaid rent and a tenant who needs to go.

Talk with your property management company about the best option for what to do when your tenant stops paying. They likely have a lot of experience dealing with all kinds of tenants, and will be able to offer you sound, realistic advice based on the specifics of your property and the current rental market.

 

What About a Tenant Who Wants to Break Their Lease?

Another issue that you may have to deal with as a landlord is a tenant who wants to leave before their lease is up. Breaking a lease is generally unadvisable for tenants, but from time to time, someone may have a legitimate reason that they need to leave: job relocation, family emergency, loss of income, etc. Other times, tenants simply want out of their responsibility– perhaps they want to move in with a significant other, or maybe they don’t like their roommates, but whatever the case may be, you need to find a way to deal with their dissatisfaction.

As a landlord, it’s in your best interest to try and come to a compromise on the tenant’s requests; resistance may lead to them stopping paying rent, and then you have to deal with that, in addition to an unhappy tenant.

If a tenant leaves, you are not allowed to simply do nothing, wait out their lease, then sue them for the months they weren’t there/were not paying. You are obligated by law to try and fill the vacancy in a timely manner. Even if you have a full plate of other responsibilities, you have to start showing the unit as soon as possible. You can charge costs of advertising the unit to the tenant breaking the lease, but thankfully, you aren’t required to list it at a below-market price just to fill the vacancy faster.

Whatever reason the tenant gives for wanting out of their lease, it is often easier to try and work with them to get the situation resolved sooner, rather than argue with them and force them to stay or sue them for unpaid rent.

If the tenant who wants to break the lease is not the only person on the lease, it should be reiterated to the remaining roommates that they are still responsible for the total amount of the rent payment. Recouping unpaid rent from a departed tenant will usually involve suing the tenant, and your leases should have a clause that informs roommates of the potential of having to cover the total cost of the rent in case someone leaves. The remaining tenants may not know that they will be held responsible if one person leaves, and that can cause a domino effect of more unpaid rent. In other words, it’s best to communicate with everyone what the terms of their lease are, even in the event of one person breaking the lease.  Try and get the departing tenant to find a sublet, but if they can’t, and you let them out of the lease, it’s up to you to fill the vacancy.

 

Don’t Get Overwhelmed

If all of this information makes you stressed out just reading it, that’s fair—dealing with unpaid rent, unhappy tenants, and broken leases can be nightmarish. Property management companies know that these issues pop up from time to time, and due to the volume of their businesses, have often dealt with these situations at least once or twice. They can help you track down tenants who aren’t paying on time (or at all), and they’ll be able to help you re-list vacant units, screen tenants, and take care of everything related to possible legal battles.

Here at Lofty, we want everyone who owns investment property to enjoy doing so, and we help facilitate that by managing every aspect of your property’s needs. We handle the difficult situations as well as the everyday minutiae of being a landlord, so that you can live the life you deserve.

Contact us anytime to learn more about how property management can make your life easier.

Speak with Lofty’s expert and managing broker Anthony Zammitt.

 

where and how to store security deposits

Everything You Need to Know About Security Deposits

By | Leasing, Property Management

You bought investment property, fixed it up to be market ready, posted an ad, screened tenants, and now you’re ready to sign a tenant to a lease. Congratulations! Now that you’ve got almost everything sorted out, it’s time to collect the security deposit from your prospective renter. If you haven’t gotten everything in line for your security deposits, though, it’s not too late. Not sure where to start? Follow this guide to learn everything you need to know about security deposits, from how much to charge to how to return them (or keep them) and everything in between.

How Much Should You Charge?

Unfurnished apartments in Chicago—as well as in most other cities and states—have a set limit for security deposits that cannot exceed the equivalent of two months’ rent (for furnished apartments, the limit is three times’ the monthly rent). For instance, if the rent is $1,500 per month, your security deposit cannot exceed $3,000; the payment due upon move-in would be the first month’s rent plus the security deposit. So, how much should you charge?

It’s advisable to charge around the equivalent to one month’s rent as the security deposit. This amount can cover a reasonable amount of damage should you need to do any repairs once the tenant moves out, and it can also discourage and weed out tenants who may be stretching their budget and savings to live in your property. One month’s rent is usually a manageable amount for most tenants, and it’s a very common amount for landlords to charge, so there won’t be any “sticker shock” with that rate. If you’re worried about turning some tenants off by charging a security deposit, you can consider charging a non-refundable fee instead. This is becoming more and more common, and it’s up to you to decide which is the best option for your properties.

When you receive a deposit from a tenant, be sure to issue a receipt including the date of payment, and keep a copy for your own records. When dealing with investment properties, the best thing you can do is keep detailed records and accurate books.

Where and How to Store Security Deposits

In most states, it’s required by law to keep your security deposits in separate bank accounts. Even if it’s not required by law where your properties are, it’s a good idea to keep deposits separate for a number of reasons:

  • They’re easier to keep track of when they’re not sharing an account with standard rent income.
  • It’s easier to manage interest earned; some states allow landlords to keep accrued interest on security deposits, while other states require anything earned plus the initial deposit back to the tenant at the end of the lease. In separate accounts, it’s far easier to track how much interest is earned on a deposit. Maintaining separate bank accounts for each property you own is advisable for optimal organization. You can have a master rental operations checking account, but security deposits for each property should be kept in separate, individual accounts (ideally also checking accounts, so that you can quickly pay them back or use them for repairs at the end of the lease).
  • It prevents accidentally spending the security deposit on maintenance or other expenses. If you do this and find yourself lacking the deposit at the end of the lease, this can be big trouble. That leads us to the next point–what you can use the deposit for.

What Can You Use the Security Deposit For?

Trick question! You can’t use the security deposit for any of your expenses, and it can only be used to cover the tenant’s last month of rent if you agree to those terms. Otherwise, it has to stay in its account, untouched, until the lease is up. Then, you can decide whether to give back the entire deposit, keep a portion of it for repairs, or keep the entire deposit (for major repairs, unpaid rent, etc.).

What to Do If You Sell the Property While Tenants’ Leases Are Still Active

There may come a time when you want to sell your property while existing leases are still in effect. In this event, you have two options: you can return the security deposit to the tenant at the time of sale, or you can transfer it to the new owner. You can’t keep the deposit (you’d think this would be common knowledge, but it’s always good to cover all the bases!). If, for whatever reason, an owner does walk off with the deposits when selling the property, the new owner cannot demand a second deposit from the tenants—the new owner will have to come up with that money on their own. But we don’t need to worry about that, do we? You know you can’t keep the deposit. Let’s move on!

The Lease Is Up: Now What?

When your tenant’s lease is up, there’s a set time frame you have to return the deposit. Since you kept the deposit in it’s own account (you kept the deposit in it’s own account, right?) returning it or keeping it is a pretty easy endeavor. If you’re returning the entire deposit (the tenant screening process worked!), you simply write your tenant a check for the whole amount (plus the interest, if applicable), along with a receipt, and you’re all done. This should be done within 14 to 60 days of the tenant’s moving out, but check your state’s laws on when security deposits need to be returned to be safe. Be sure to date the receipt—a simple mistake of omitting the date can cause a lot of problems, and can cost you money if a tenant later claims you didn’t pay their deposit back. Without a date on the receipt, you don’t have adequate proof of giving the deposit back, so we can’t stress it enough—you need to date the receipt.

If you’re keeping any of the deposit, it’s best to give your tenant an itemized list of charges as well as a receipt for the amount issued. You can’t keep any of the deposit to cover normal wear and tear, but you can keep part of the deposit for repairs or extensive cleaning.  

If you’re keeping the entire deposit, it’s beneficial to notify the tenant as such as well as provide them with an itemized list of expenses that were covered with the deposit. All of this paperwork should be dated, and it’s important to notify the tenant of this in a timely manner. Sometimes, tenants will try to fight your keeping of the deposit, and that’s where detailed documentation of the apartment’s condition upon move-in and move-out as well as any repairs or maintenance done will come in handy. You can fight the tenant for what’s rightly yours, and provided your reasons for keeping the deposit are reasonable, you’ll be ready to re-rent the apartment in no time.

 

You Don’t Have to Do Everything On Your Own

An important note about all of this is that when it comes to managing security deposits or any other part of the property ownership or landlord responsibilities, you don’t have to do everything by yourself. In fact, if you are doing everything yourself, it can be easy to miss certain details or get so bogged down by busywork that you aren’t able to do what you really want to be doing. You didn’t get involved with investment properties so that you could screen tenants and deal with writing up maintenance checklists after leases end—you got into investment property to, naturally, see a return on that investment.

Here at Lofty, we understand that your time is valuable, and we think you should be enjoying owning investment property, not spending all your time dealing with leases, security deposits, and other paperwork. We work hard to make sure our clients and landlords have an easy time with their investment properties, and we do so by taking care of every aspect of property management, from advertising your apartments in Chicago to screening tenants, scheduling maintenance and repairs, collecting rent and distributing security deposits, and so much more. With the help of a property management company, you can spend your time how you want to spend it—not doing work for your properties.

To learn more about how Lofty can help you start living the life you deserve, contact Lofty’s managing broker Anthony Zammitt to chat!

when to clean dryer vents

What You Need to Know About Duct & Dryer Vent Care in Your Properties

By | Property Management

When you own investment properties, making sure you schedule regular maintenance can save you a lot of hassle from having to do costly emergency repairs. If you’re a first time landlord or just want to know more about how to best maintain your properties’ ducts and dryer vents, this is the guide for you. Learning about what you can expect, how often maintenance is required, and how much you’ll be paying for duct and dryer vent services can ensure that your properties stay in tip top shape for the duration of your ownership.

What Kind of Maintenance is Required?

Dryer vents and ducts need to be kept clean in order to ensure that your properties are safe. Dryer vents can become clogged over time, and in order to prevent house fires, you’ll need to make sure they’re not blocked. Ducts should also be cleaned to improve the air quality in your properties. Dust, mold, and other contaminants can build up in ducts and may cause health problems for you or your tenants. As a landlord, you’re responsible for providing a safe and healthy environment for your tenants, and duct and dryer vent cleanings need to be a part of your maintenance checklist.

How Often Do You Have to Do It?

Dryer vents should be cleaned about once a year, though you can schedule regular checks for blockages every six months to be extra careful. As for duct cleanings, those can be done less frequently. Duct cleaning is suggested every three to five years, but that time frame may vary depending on what part of the country your property is in, how often the heating and cooling system is used, or if anyone living in the space has health problems related to air quality.

How can you tell when it’s time to schedule a cleaning? Contact your property management company and have them schedule duct cleaning services if any of these apply to your situation:

  • You suspect mold is in the ducts.
  • You can see visible puffs of dust leave the air vents when the system is turned on.
  • If there is/was a pest infestation in the property (such as before you took ownership).
  • Your air filters are heavily coated with dust when you replace them—this can be a sign you’re overdue for a cleaning.
  • You’ve done heavy renovations in a property. Drywall dust and other contaminants can build up in the ducts during construction, and prior to tenant move-in, the ducts should be cleaned.
  • There are a lot of pets in the building. Ducts will need more frequent cleaning if there is pet hair and dander in them.

 

How Much Will It Cost?

Cleaning your dryer vents generally runs from $60-$150, depending on who you work with. Duct cleanings can be more costly, depending on the size of the property and how much work needs to be done. In order to get the best deal, be sure that the company you choose for the service offers full service cleaning, which should include a full cleaning of the heating and cooling unit. Get written estimates by a few HVAC cleaning companies—reputable companies should provide a free inspection and estimate. Don’t fall for “all-inclusive” deals that are extremely low-cost, because they can be very cursory jobs that will just have you calling another company to do the work the first company missed. High quality duct and dryer vent cleaning can take a few hours and may involve sophisticated equipment—not just a half an hour with a Shop-Vac. If you’re not sure how to find the most reputable HVAC and duct cleaner in Chicago, your property management company can help. They should have a list of qualified, reliable contractors that you can trust.

What Happens If You Don’t Do It?

Dryer vent fires are a very real threat if you don’t do routine cleanings. According to the National Fire Protection Association, dryers were the cause of more than 15,500 home fires in 2010, so taking the chance simply isn’t worth it. Less serious issues can include longer dry cycles (which range from being merely inconvenient to downright problematic, if your tenants threaten to withhold rent until maintenance is performed), or a clogged vent system. If the vent system is clogged and not exhausting properly, it can wear out your appliances much faster due to the higher heat. Wait too long and you may need to completely replace the vent system, which can be a costly procedure—you’ll be wishing you had paid those smaller fees to clean the vents!

Neglecting duct cleaning can also lead to dust and other contaminants building up over time. Beyond improving the quality of the air in your properties, cleaning the ducts will help improve the efficiency of the building’s heating and cooling units. When it comes to winter property maintenance and ensuring your tenants stay safe and warm through the cold spells, duct cleaning can play a big part.

Want to know more about duct cleaning and dryer vent maintenance? At Lofty, we’re committed to helping landlords and property owners live the life they deserve to be living, and that includes helping you take care of building maintenance and repairs. Contact us anytime and let us take some of the responsibility off your hands, so that you can spend your time doing things you want to be doing.

Speak with one of our experts to find out how we can supercharge your investment.

how property management companies can help you

Landlord Responsibilities Between Tenant Occupancies in Chicago

By | Property Management

When you’re a landlord and have regular turnover in your units, the work that you need to get done between occupancies can start to feel like it’s taking up all of your time—partially because if you have enough properties, it actually is taking up all of your time. Tenant turnover procedures and responsibilities can take up a lot of time, but another reason you may feel like you’re running around all over the place can be chalked up to doing tasks that are unnecessary. In order to ensure you’re making the most of your time, you need to be aware of what’s truly required of you as a landlord or property owner when one tenant moves out. Finding out what your responsibilities are between tenant occupancies can not only save you a lot of time, but it can save you some money, too.

Don’t Expect Your Tenants to Leave the Place Move-In Ready

The first step with this process is to go into the situation with reasonable and realistic expectations. In other words, while in a perfect world all of your tenants would patch holes in walls, scrub the floors til they’re sparkling, and do everything else necessary to bring the apartment back to life, that will almost never be the case. Tenants can generally be expected to clean the apartment before they move out, but they’ll be busy focusing on getting their moving plans and their new apartment in order, not making sure that their old place is in perfect condition and prepped for new tenants. Keep in mind that the responsibility for making the apartment ready for your next tenant will largely fall on you and your property management company.

 

What Needs to Be Done Between Tenant Occupancies?

Think about what you would expect an apartment to look like when you moved into it for the first time—that can be a starting guideline to knowing what you need to do for your tenants. For instance, if the paint and walls are dirty, scuffed, or scratched, you need to repaint them so that the apartment looks its best. Your new tenants are paying to live in a comfortable, habitable space, so it’s up to you to make sure their new home is livable and inviting.

Appearance, Security, and Safety of Chicago Rentals

Beyond aesthetic work like repainting, you need to make sure your new tenant is aware that they need to set up the utilities in their own name. This is usually outlined in tenant leases, but it can’t hurt to remind new occupants of that responsibility.

You’ll also need to rekey the locks for the apartment. This is a security measure that will prevent former tenants from having access to the unit, and thus, it keeps your new tenants optimally safe. Be sure to get the keys back from the old tenant, as well. Even with rekeying individual units, many buildings have master keys for the main entryway doors that may not be rekeyed every time someone moves. If a tenant doesn’t return keys, you may want to charge a fee to cover costs (and, when this is noted in the lease, it can incentivize them to return the keys!). If the tenant still doesn’t return keys, you’ll have to rekey everything their set had access to and take the costs from their security deposit.

You’ll want to do a walk through before you schedule any maintenance, so that you can make note of any repairs or other damages you’ll need to take out of the departing tenant’s security deposit (if there is one). Take photos of the unit and any damages and write down detailed descriptions of what was left for you to take care of. Having a detailed list of what you’ll be retaining a portion of the deposit for can help you down the road, particularly if the tenant fights you on the withholding of any or all of the deposit.

However, it’s best to do this walk through without the departing tenant there—their presence can not only put a lot of pressure on you to give them answers about their deposit on the spot, but they can also mask problems that won’t show up until a few days later, like stains that have been scrubbed from the carpet, only to reappear when the cleaner dries, or lingering pet odors.

Make sure that everything is still in proper working order before a new tenant comes in. Check that the shower, toilet, and sink in the bathroom all function as they should, that the refrigerator and freezer are still working, and that electrical appliances and lights in the unit are still safe—there should not be any loose wires or broken bulbs when a new tenant moves in. You may not be required by law to provide new tenants with working light bulbs, but that small cost can be a good start to the tenant-landlord relationship, and should be considered.

Once all of these tasks have been taken care of, it’s advisable to bring in a cleaning crew for a deep cleaning of the unit. A professional cleaning company will make the place move-in ready, something that your new tenants will appreciate.

As far as painting, unless the paint is peeling or overly damaged, you may not be required to paint. Many landlords allow their tenants to paint for them, provided they repaint it back to a neutral shade upon move-out. It’s up to you how you want to manage painting. Some landlords dislike the prospect and work involved in painting, and offer their tenants the option to choose paint and do it themselves, taking the cost out of their rent. How you deal with painting in apartments between tenants is mostly personal preference, though you should make sure there are no state laws requiring painting every certain amount of years.

 

Using Your Time Efficiently When Transitioning Tenants

All of these tasks may seem like they won’t take up too much time, but when you have multiple units across multiple buildings, with tenant leases ending at different times, the amount of time you spend preparing your properties for new tenants can really add up. You shouldn’t be spending all of your free time doing apartment upkeep and maintenance; getting involved with investment property was supposed to be beneficial to you, not take up all your time, after all.
You could hire out contractors to do the work for you, of course, but even that requires you to show up to the property to let cleaners, painters, and other maintenance workers in and return to the property when they’re finished to ensure the building is secured. Though it’s less time consuming than doing everything yourself, it’s still a lot of wasted time that you could be spending doing something more productive or enjoyable.

 

How Property Management Companies Can Help You

If you’ve never worked with a property management company for your properties, you may be surprised at how much they can help with move-out and move-in procedures, as well as other aspects of being a landlord. They’ll be able to contract out the necessary work, meet workers at the property, ensure that the units are ready to go for the next tenant, and work with departing tenants to get everything squared away for you. You can literally hand off all of those pesky jobs to someone else and really reap the benefits of owning investment properties.

Here at Lofty, we believe that owning investment properties shouldn’t be a headache. We take care of everything our clients need, from screening tenants to doing the work between occupancies. Stop wasting time checking whether lights are working and sweeping baseboards and start enjoying being a landlord and property owner.

For more information about how we can help you live the life you deserve, contact us today.

Speak with one of our experts to find out how we can supercharge your investment.

 

what to do if tenants wont pay rent

When to Raise Rent in Your Chicago Apartments

By | Leasing

As a property owner or landlord, getting a good return on your investment is part of why you do what you do. While you want to keep your tenants happy while they are renting from you, the inevitable truth is that sooner or later, you’re going to have to raise rent. There are ways to do so that can keep tenants satisfied while also boosting your income and profits. One of the trickiest parts of being a landlord or investment property owner, though, is knowing when it’s time to raise rent and by how much. If you don’t have a property management company advising you, that can certainly help, but in the meantime, here are our tips for knowing when to increase rent.

When (and How Often) Should You Raise Rent?

Raising rent can be a contentious subject. You and your tenants both know that it’s something that will eventually need to be done, but when and how often you do it are two things you need to consider. If you give your tenant a great deal on their Chicago apartment when they first sign the lease, then don’t increase rent for a few years, you may find that by the time you decide to increase it you’re getting far below market rate for the unit and may need to raise it by a significant amount. Increasing the price all at once can be a big burden on your tenants, and after developing a good working relationship with them, it can cause a lot of conflict. The worst case scenario is that they can’t handle the increase financially and they’ll move out of your property, leaving you with an unexpected vacancy, but that can be prevented with a little foresight.

In order to avoid finding out that your tenants are paying a few hundred dollars under market rate and increasing by that amount all at once, it’s best to increase rent little by little for each year of their occupancy. Even if you increase the price by just $25 per month, that’s an extra $300 per year–for every tenant you have. Steeper increases, of course, add up to even more profits.

If you don’t want to raise rent every year—for instance, if you want to reward an especially trustworthy and timely-paying tenant—that’s okay, too. Rent increases are a very subjective topic, and when you decide to increase rent should correlate both with market fluctuations and inflation as well as your personal preference and relationship with the tenants. Just keep in mind that eventually, you will need to increase the rate to keep up with your own expenses.

If a tenant moves out, however, you have the perfect opportunity to reassess the worth of your property and increase the rent accordingly. When your units are vacant, that’s the perfect time to capitalize on the market’s fluctuations and change what you’re charging for your apartments and homes.

How Much Should You Increase Rent By?

How much you raise rent should be influenced by a few different factors. While it can seem tempting to raise the rent a lot to keep in time with the market, such as when a neighborhood  becomes the “hot” place to live, this can lead to your apartments sitting vacant for longer than you’d like. You should weigh the benefits and drawbacks of raising rent by a lot—will your current tenant move, leaving you to find a new renter? You need to consider if the potential for vacancy is worth the additional income from a significant rate hike.

If you want to keep your current, reliable tenants, the safest way to do so is by raising rent somewhere between two and six percent, after assessing the state of the market as well as local demand. This amount is usually manageable for tenants and won’t typically cause them to need to find a new place to live, but the increase, even though it’s seemingly small, is more than enough to make a difference in your bottom line.

If you’re not sure how much you can safely raise rent by in order to keep your current tenants, or you want advice on how much you should raise the rates to get a better return on your investment properties, asking your property management company can be a great help—they’ll have a lot of information about competing properties and what the average rentals are going for in the area your property is.   

Should You Ever Avoid Increasing Rent?

Sometimes, such as if your property tax doesn’t increase (what luck!), you may be tempted to avoid increasing rent at all. While you’re well within your rights to do that, it’s generally recommended to increase rent by at least a little bit each year so that you won’t have to increase rent by a very large amount at a later time.

What to Do If a Tenant Pushes Back

Unfortunately, one result of raising rent can be your tenant choosing to move. Again, this is something you’ll want to weigh before you raise rent, but ultimately, if a tenant doesn’t want to or can’t pay the increase, they’ll have to move. If you do want to help accommodate your tenants’ needs, though, you can work with your property management company to determine whether you can raise rent a bit less or not.

 

Feeling Stuck or Confused?

Dealing with rent increases can be a complicated subject, and if you own a lot of properties in different areas in Chicago, doing it all yourself can be a big headache—it can seem like all you’re doing sometimes is analyzing the market and adjusting numbers.

At Lofty, we believe that being an investment property owner or landlord shouldn’t have to be a full-time job, and we do everything we can to ensure that you get to live the life you deserve. To learn more about the best ways to manage rent increases, contact us anytime—we’re ready to help you.

Speak with one of our experts to find out how we can supercharge your investment.

what you need to know about keeping deposits

Returning or Keeping a Security Deposit?

By | Property Management

Lofty Real Estate saves you money
If you’ve been a property owner or landlord in Chicago for any significant amount of time, you probably know all about security deposits: how to store them properly, when you need to give them back (if you plan on giving them back), what constitutes normal wear and tear and what constitutes damage that should be paid for with the security deposit, and how to deal with tenants who fight your decision to withhold the deposit.

But if you’re just dipping your toes into being a landlord or owning investment properties, learning about all of it can make your head swim. At Lofty, our goal is to make your job easier, and that means teaching you everything you need to know about returning (or not) the security deposits for your properties.

Returning It? Here’s How

Generally speaking, in Illinois, security deposits must be returned to the tenant within 30 to 45 days of the lease ending. Though some states require landlords to give tenants a move-in statement that details the condition of the property, Illinois is not one of them, so it’s in your best interest to keep accurate records of the condition your properties are in when tenants move in. That way, when they vacate the unit, you can cross-check against your old notes and see if there are repairs that need to be made.

If you’re returning the deposit, be sure to make receipts for both your own records and the tenant’s, so that the tenant can’t claim you never returned it. When you return the deposit, be sure to date the receipt—though it seems like a simple detail, leaving it out on accident can come back to haunt you. Without a date on receipt, you could find yourself paying out more in fees and court costs if tenants take you to court over deposit-related conflict. If it sounds confusing, don’t worry—it kind of is. If you’re taking matters into your own hands, security deposits can be a real headache. Working with a property management company can help take away some of the stress associated with security deposit issues.

What You Need to Know About Keeping Deposits

Returning a security deposit is easy. It’s when you decide to keep some or all of it that things can get really messy. Here’s what you should know about keeping deposits.

First Things First: What Constitutes “Normal Wear and Tear”?  

Security deposits are typically kept by landlords in Chicago (and elsewhere) to cover the cost of damages and repairs. A lot of times, this is fought by tenants who claim that the damage is consistent with “normal wear and tear” on the unit. Normal wear and tear is a real thing, but in order to know whether or not something falls under that category, it’s helpful to know what’s generally considered normal wear and tear in a rental unit.

    • Flooring: Carpet gets dirty and hardwood floors can get scratched, but if a tenant leaves behind pet stains or multiple cracked tiles, or floorboards that are excessively damaged, that’s not considered normal use.
    • Walls: This is a big issue between landlords and tenants—whether holes from nails used to hang artwork or other decorations are considered normal wear and tear. And the answer tends to differ from landlord to landlord. Use your best judgment here; splitting hairs over two or three nail holes might not be worth the potential hassle of a tenant trying to take you to court for the security deposit. Holes in the wall, however, are a completely different story and should be fixed with security deposit funds.
    • Pet Damage: Things like chewed-on cabinet doors, scratches on the walls, and stains are all out of the realm of normal wear and tear in a rental. In order to plan for problems like these, many landlords choose to charge non-refundable deposits or additional pet rent.
  • Overall Cleanliness: While you might want to reconsider charging a cleaning fee for unswept floors and some light tidying, if a tenant leaves behind the remnants of a last-minute party, food in the refrigerator, and general filth, it’s more than acceptable to charge for cleaning.

The Most Common Reasons Deposits Are Kept

There are a handful of reasons that a security deposit might be withheld. They include:

  • Early termination of the lease
  • Unpaid rent
  • Money owed to the landlord for utility bills
  • Cleaning fees for dirty or un-cleaned apartments
  • Damage to property (or furniture in furnished units)

 

What Do You Have to Provide to the Tenant if You’re Keeping the Deposit?

Laws vary from state to state regarding what you need to give your tenant if you are keeping any or all of their deposit, but generally, it’s good form to provide a list of services performed or things that needed fixing/replaced and the costs associated with them. This lets the tenant know that you actually used the money for what you said you did, and that you didn’t just charge $200 to dust the baseboards.

What to Do If a Tenant Contests Your Decision

If a tenant feels that you are wrongfully withholding any or all of their deposit, they may choose to file in small claims court or even hire a personal attorney to handle the case. However, you have rights—if you are justified in keeping the deposit, you can counter-sue the tenant to ensure you don’t end up underwater with fees and costs. Going to court can be a huge pain and can cost a lot of money for all parties, though, so if it’s a minor quabble—say, over a $50 invoice for cleaning, it may be best to try and settle with the tenant to avoid a costly court case.

Getting Help When You Need It

You got into investment property ownership to make money, not to make your full-time job dealing with tenant hassles. Here at Lofty, we want to help you with every aspect of being a landlord, from finding the best tenants to answering your security deposit questions and everything in between, so that you can save time and frustration and do things you actually want to do. Contact us anytime to learn how working with a property management company can help you start living the life you deserve to live.

Speak with one of our experts to find out how we can supercharge your investment.

Furnished or Unfurnished Apartments in Chicago: Which Should You Offer?

By | Leasing

 

The Case for Furnished Units

Furnished apartments are sought after for a number of reasons. People who are looking for shorter term rentals (such as a summer sublease, or a one-year stay in a city) or who don’t want to bother with decorating their own spaces will often seek out furnished apartments. Additionally, college students who don’t yet need their own sets of furniture will make up some of your interested tenants. Furnished apartments in Chicago are beneficial for landlords whose rental pool includes these demographics, but beyond simply meeting a demand and having a predictable market, there are other reasons why a property owner or landlord might offer their apartments as furnished units.

Increased Rent and Security Deposits or Fees

When you have furnished rental units, you can charge more for them, because you’re offering your tenants the convenience of not having to supply their own furniture. Even with the increased cost, though, renters who want furnished units tend to agree that the added cost is worth not having to buy furniture. You’ll also be able to set higher move-in fees or security deposits to cover the costs of supplying and maintaining furniture.

Quicker Tenant Turnover

When you rent out unfurnished apartments, the move-in/move-out processes can be somewhat complicated—coordinating walk-throughs to check for damage can be time-consuming, since you need to wait for all of the furniture to be out of the unit prior to checking. With furnished units, you just have to clean the unit and the next tenant can move in right away.

 

Ease of Finding Renters

Renters who need furnished units in Chicago know that they have fewer options to choose from, and know they can’t be as choosy as they might be if they were looking for an unfurnished apartment. Even though renters who want furnished apartments are scarcer than those who want unfurnished apartments, finding tenants for your units is still relatively easy, simply because there aren’t as many furnished apartments on the market. Since supply is limited, it’s usually not difficult to find renters for furnished apartments in Chicago.

Potential Pitfalls of Furnished Units

On the other side of the coin, offering furnished units can have some drawbacks. First, you’ll have to source furniture that is durable and reasonably attractive, which can be a tall order. The upkeep in these apartments can be more labor-intensive as well, including replacing or repairing furniture as it endures natural wear and tear.

There is also higher turnover in furnished apartments, simply because those renters are usually staying for shorter periods of time than renters in unfurnished apartments.

Perhaps the biggest potential downside of offering furnished units, though, is the possibility that tenants will cause more damage than they would in an unfurnished unit. That can be attributed to the thought that because the furniture is not theirs, they don’t need to take good care of it—after all, if anything breaks, their landlord can just replace it! In order to protect yourself from destructive tenants, it’s helpful to work with a property management company in Chicago to screen tenants and find the most trustworthy renters.

Benefits of Renting Unfurnished Apartments

Furnished apartments are much more common to find listings for, and for that reason, tenants have a lot more to choose from. This makes your job a bit tougher, but offering unfurnished apartments in Chicago offers a lot of great benefits as well.

A Larger Tenant Market Means Shorter Vacancy Periods

Unfurnished apartments are generally pretty easy to rent because they’re what most tenants are looking for when they’re hunting for a place to live. For that reason, your vacancy periods may be shorter than they would be if you were renting furnished units. Additionally, since more people are looking for unfurnished apartments in Chicago, you’ll have more flexibility in choosing renters, and can be a bit pickier when it comes to tenant screenings.

Since more people want unfurnished apartments, it’s usually easier to get them rented. You can show the units either with furniture in them or without—or, you can feature photos of the apartment in both states, so that people can visualize what they can do with the space.

People may be interested in a certain location, but if your unit is offered as being furnished and they have their own furniture, they’ll pass on yours. Marketing unfurnished apartments means you may have better luck keeping your apartments in Chicago rented.

Less Upkeep and Responsibility

Unfurnished apartments are also a bit less responsibility to take care of than furnished ones. Furnished units need to be kept looking their best, and that can mean replacing the furniture pretty frequently—over the lifespan of your property, that can add up to a lot of money spent on furniture. Similarly, when one tenant moves out and you need to prep it for the next renter, you don’t have to move furniture to paint or refinish floors, for instance. Generally speaking, you’ll have less to do with unfurnished units in the realm of cosmetic updates.

Possible Problems Associated with Unfurnished Rentals

Thankfully, there aren’t too many issues related to renting unfurnished apartments. Perhaps the biggest one you’ll have to deal with is damage caused by your tenants moving their furniture in and out of the building, or people leaving behind furniture that you then have to dispose of yourself.

 

Which Is Best For Your Property?

Although there are benefits and disadvantages to both options, the more common choice for property owners in Chicago is to rent their units as unfurnished apartments. If you’re still not sure which is best for your specific property, working with a property management company can be very helpful. They’ll be able to help you make an informed decision about your apartments, and they’ll also be able to take care of all the maintenance, bookkeeping, and other responsibilities of being a landlord, so that you can live the life you deserve. Here at Lofty, we want to help you make the most of your investment properties—call us anytime to learn more about how we can make owning rental property a lot easier for you.

Speak with one of our experts to find out how we can supercharge your investment.

how to move out tenants chicago

How Property Management Can Make Move-In and Move-Out Easier for You

By | Property Management

When one lease ends and another begins, there’s a lot of work that needs to be done. Security deposits need to be sorted and returned to departing tenants, the first month’s rent needs to be collected from new renters, and in between, maintenance may need to be done on the property. And if you’ve got one tenant moving out without having one lined up to move in, that’s even more work—creating an ad and marketing the property, booking showings, and screening tenants. Altogether, it’s a lot of time that you could be using to do virtually anything else. Owning and managing investment properties shouldn’t be a mess of paperwork and endless busywork. If you’re tired of spending all of your time on what you thought would be a relatively easy way to earn extra money, you’ll be relieved to know that you’re not stuck—learn more about how property managers can make the move-in and move-out processes easier for Chicago landlords and property owners.

What to Do When Tenants Move Out

When tenants’ leases end and they move out, there are a few things that property owners or landlords have to do, including:

These three tasks alone can be be very time consuming—finding vendors and contractors to take care of repairs, maintenance, and any updates you want to make can feel like you’re on a wild goose chase. Once you find contractors, you’ll have to fit them in your schedule during a time when you can be at the property. To say that it’s inconvenient is an understatement. Getting keys back from the tenant can also prove frustrating. If you’re working with a property manager, though, they can take the time to track down the tenant, so that you don’t have to deal with calling over and over again, getting their voicemail every time. Likewise, the best property management companies in Chicago will have a list of trusted, vetted vendors and contractors that they can schedule for any property maintenance you need, and you won’t have to be there for any of it if you don’t want to.

 

Managing Vacancy Periods in Chicago Rentals

After one tenant moves out, one of two things will happen: there will be a vacancy period, or the next tenant will move right in. For now, let’s focus on the former.

If your property is vacant, you need to place ads, market the property, field phone calls from interested renters, schedule bookings, and show your property. If you’re trying to do this on your own, you can end up spending almost all of your extra time dealing with the property—which can feel like more work than it’s worth. After all, you got into investment properties to make money, not to take on a second full-time job, right? Property management companies in Chicago have written hundreds of apartment, condo, and home ads, and in addition to knowing the best places to market your property, they can often work out better deals with publications than individual landlords or property owners can, simply due to the higher volume of ads they place.

You want your vacancy period to be as short as possible so that you aren’t losing money, and property managers will be able to set your rental price according to current trends and market demands. You won’t have to worry if you’re charging too much or not enough for your rental, and people will be more interested in the property when it’s priced well—too high and people will balk, but too low, and some people may wonder what’s wrong with the place (are the walls so thin that they’ll be able to hear their neighbors debate about who should win The Bachelor, for instance?).

Once the property managers have shown your property and have some potential tenants lined up, they’ll be able to screen them, too. You won’t have to deal with background checks or conducting interviews. Property management companies have tried-and-true methods for ensuring they’re getting reliable tenants into properties, too, so you won’t have to worry about whether the tenants are the type of people who pay rent late every month or host loud, late-night parties in their studio apartments every weekend.
Imagine not having to deal with any of the headache-inducing frustration that is the vacancy period. You’ll have so much more time on your hands—time you could use to, say, catch up on The Bachelor (or do anything else!). Working with a property manager means you won’t have treat owning investment property like a second full-time job.

Helping Tenants and Landlords with the Move-In Process

Now that you’ve got a tenant who is ready to move into your property (whether or not you had a vacancy period), you’ll have to do even more work. It can feel like it’s never-ending, can’t it? Some property owners and landlords like to be onsite when new tenants move in, for helping with anything that might come up, and if you own a lot of properties, that can mean busy days for you every time a new lease starts. You’ll also need to make sure that the new tenant has paid their first month of rent, which can, like getting the keys back at the end of a lease, sometimes be a frustrating process. New tenants may not know where to send rent at first, too, which can lead to a late payment or two. You shouldn’t have to worry about tracking down your payments, and when you work with a property management company in Chicago, you won’t have to. Property managers take care of everything related to the tenant move-in process. They can be onsite during the move, they can track down your rent checks, and if anything happens during the move-in process, they can quickly schedule maintenance or repairs. It’s a level of convenience that’ll have you wondering why you didn’t start up with a property management company sooner.

Enjoy Your Time and Your Property

Here at Lofty, we understand that your time is your most valuable commodity, and we work hard to ensure you won’t have to waste it doing busy work for your rentals. We can take care of everything during the move-in and move-out processes for your properties, and we can also manage vacancies so that you can earn more money. To start living the life you deserve to live, give us a call anytime—we’d love to work with you and help make your life easier.

Speak with one of our experts to find out how we can supercharge your investment.

 

where to rent chicago

Why Some Chicago Neighborhoods Are More Expensive to Buy and Rent In

By | Property Management

When you think about real estate in Chicago to rent or buy in, you’ve probably got a pretty good picture of what the more expensive neighborhoods look like: high-end boutiques, unique, trendy restaurants, and sharp looking homes, condos, and apartments. You’re not wrong—these highly sought after lifestyle amenities are what make some neighborhoods so hot. But when it comes to buying and renting, there are some other reasons why certain areas of Chicago cost what they do. Learning what tenants are looking for (hint: it’s not only stainless steel appliances and marble countertops) will help you make the best decisions about where to purchase investment property or rental units.

Neighborhood Growth

Over time, the vibe of different neighborhoods changes, causing fluctuation in things like how much homes are valued at. As a property owner or landlord, it’s natural to want to get the most return on your investment, so purchasing properties in up-and-coming neighborhoods is generally a great plan. An increase in the cost to rent or own in a neighborhood can often be attributed to the amount of—and the type of—development happening in an area. If more restaurants, newer apartment buildings or homes, and other interesting hotspots are being built up in a certain area, it’s safe to assume that those neighborhoods will soon cost more to live in, and in turn, will cost more to rent or own property in.

Location, Location, Location

Of course, where an apartment, condo, or home is located in Chicago will also dictate how much it will cost. Property owners and landlords know that the closer a home is to L stops, the more sought after it will be—Chicago is a city full of commuters young and old, and getting to school or work conveniently is a priority that a lot of renters and owners have when choosing where they live. For instance, though neighborhoods like Rogers Park have a lot to offer, they’re further away from the center of the city, and it can take longer to get places from there. The same can be said for most any neighborhood on the outskirts of the city—the longer it takes to get somewhere, the less popular the area is, generally speaking.

What’s Happening?

Aside from simple proximity to transportation, people will be looking for what they can do in their neighborhood without getting on a train or bus. In other words, what Chicago events take place? For example, in neighborhoods like Bucktown and Wicker Park, the Do Division and Wicker Park Fests are a popular fixture every summer, and for those who already live in the area, it’s a convenient way to spend a weekend. In River North, plenty of nightlife options are attractive to people who love checking out the latest bar, nightclub, or restaurant. When considering where to purchase investment property, property owners and landlords should consider what their potential future tenants will be looking for and make decisions accordingly. In order to get the best return on an investment, you’ll want to be able to offer your potential renters something they find value in.

How to Stay Ahead of the Curve

Naturally, purchasing property that is in a popular neighborhood will mean that you’ll likely have no trouble renting it. But as a landlord or property owner, it’s only natural to want to get a great deal on property as well as be able to make the most of your investment. Paying a high cost upfront can mean spending a lot of time trying to keep up with the competition—working very hard for marginal returns. Earning more on your investment means looking at up-and-coming neighborhoods that don’t yet have the numbers you’re looking for, but will very shortly.

Take a look at a neighborhood like Logan Square. A decade ago, tenants shied away due to lack of development. Five years ago, renting in Logan Square was a popular choice with younger, “artsy-type” tenants who were looking for a great deal after being priced out of Wicker Park. Now, it’s one of the hottest and fastest-growing areas in the city. Rents have gone up—the average price of a studio apartment is now between $800 and $900, with larger apartments costing more—a lot of new businesses are thriving, and the overall feel of the neighborhood is much more fun and exciting than it used to be. As a landlord or property owner, finding properties in neighborhoods that are growing but not yet fully built-up—such as Humboldt Park or Avondale—can mean a high return on your investment. In a similar vein, purchasing apartments, condos, and homes in popular Chicago neighborhoods like Hyde Park, Lakeview, and West Loop can mean you’ll always have people interested in your property.

Taking advantage of growing areas means keeping a close eye on where developers are heading and where tenants are moving from. This will give you a good idea of where to buy or rent next—property owners benefit a great deal from getting into a certain real estate market early. As an area heats up, you can adjust rent accordingly and watch your profit margin rise. You’ll also want to look at properties that are closer to the L stops and bus lines—as we previously mentioned, ease of getting around is a major reason people pick to live in one place over another. That means that cost of properties will be different even from block to block. Choosing location wisely can have a huge impact on your property’s success.

Start Taking Advantage of Opportunity

When you’re ready to start capitalizing on new rental properties or want to learn more about why some neighborhoods cost more to rent and own in than others, property management companies can offer a lot of insight. At Lofty, we’re ready to help you get the most out of your investment so that you can live the life you deserve. Contact us anytime to find out more about investment properties in Chicago and how you can make them work harder for you.

Speak with one of our experts to find out how we can supercharge your investment.

tenant screening chicago

Credit Checks And What To Look For When Screening Potential Tenants

By | Leasing

When you’re trying to fill your property vacancies on your own, finding new tenants can almost become a full-time job. Credit and background checks are a good place to start, but in order to choose the best, most reliable and trustworthy tenants, you should be looking for certain things that can mean problems for you down the line. Making the best choice the first time is a perfect goal to aspire to, and the best way to find the best tenants for your properties is to pore over background checks and credit checks with a fine-toothed comb, weeding out the applicants who might cause you headaches later on.

What to Know Before the Background and Credit Checks

Ask most any landlord or property manager how they find the best tenants for vacant properties, and you’ll likely hear that they start the tenant screening process the first time they make contact with an interested applicant. By asking potential tenants a few key questions, owners and landlords in Chicago can get a better feel of what they might be getting into if they rent to that a person. For example, if you ask someone looking at your property when they need to move in, and they say in just a few days, it can be an indication that this tenant hasn’t planned ahead enough (will rent be late, too?). However, if the person answers that they don’t need a new place for four months, you can count on them not being ready to commit to signing a lease, simply because they have a lot of time to look at plenty of properties and won’t feel any time crunch. Both of these situations can cause potential snags in your rental process. As a property owner, you should ask potential tenants a few questions to get a feel for what kind of renters they’d be, such as:

  • Income What their monthly income is, and whether they can show proof of it. If they’re reluctant to provide proof of income, they may not be telling the truth about the amount of rent they can cover every month.
  • References If you can, get a reference or two from former landlords. Current landlord references can help in a pinch, but if the tenant is bad, that landlord might say just about anything to get rid of them. Instead, check with former landlords, who have no reason to lie about a tenant who regularly hosted loud parties late into the night, left cigarette burns on the hardwood floors, and smashed holes into the walls before moving out (some of those “worst tenant ever” stories will give you nightmares!)
  • Motivation Why they’re moving. This sounds pretty basic and perhaps a bit personal of a question, but while most tenants will say that they need more space or want a change of scenery, some will mention problems with their landlord or an eviction. These are obvious problems you’ll want to avoid.

 

Conducting Background Checks and Credit Checks in Chicago

Nowadays, potential tenants are used to being asked to submit to a credit and background check as part of the approval for a new rental. If an applicant resists this step, it could be because they are hiding something—felonies, evictions, collections, or a host of other issues—and you may want to reconsider the offer.

Once you’ve run the background check and credit check, there are a number of things to look into when deciding which applicants will be the best tenants for your apartments or condos in Chicago.

Evictions

Obviously, if you see that a tenant has been evicted from properties before, you may want to do some investigating. These may not always mean that the prospective tenant should be disqualified—ask the tenant and previous landlord the details, and make an informed decision from there. One instance of a wrongful eviction might be something like a landlord refusing to make repairs, and evicting the tenant in retaliation. Illegal? Absolutely! That’s why it might be in your best interest to work with applicants on a case-by-case basis if an eviction is the only red flag on their background or credit check.

Public Records/Lawsuits

Another thing you’ll want to look out for is whether your applicant has ever been sued for things like unpaid rent or unpaid child support. These can be a pretty clear sign that the applicant has trouble paying for things on time. Do you want to roll the dice and cross your fingers that you won’t be the next person chasing down payment? Probably not, especially when you can likely find other renters in Chicago who are better suited for your property.Make sure that the applicant’s credit score is healthy, too—multiple collections and a high debt-to-income/limit ratio can mean a tenant has problems managing money.

Run-Ins With the Law

If your applicant has some minor things on their record, you may not need to worry about them being an unsuitable tenant—plenty of people did stupid things when they were young that they now regret as responsible adults, and these infractions may not be grounds enough to discount them from your applicant pool. However, some criminal charges could mean putting yourself and your other tenants at risk. Use your best judgement in these cases, or confer with your property management company for a second opinion. Felonies can indicate a disregard for following the rules (obviously), and renting to these applicants can mean allowing someone that is potentially dangerous into your property—seriously, those “worst tenant ever” stories are no joke. Don’t let your property make a Buzzfeed list for the wrong reasons.

Need Help With Tenant Screenings?

Screening applicants doesn’t have to be your full-time job. Property management companies can be a great asset when you want to spend your time as a landlord or property owner doing something different. Here at Lofty, we know that your time is your most valuable commodity and we’ll help you manage anything you need. Give us a call today and find out how we can help you enjoy owning your properties even more than you already do, and start living the life you deserve.

Speak with one of our experts to find out how we can supercharge your investment.

 

 

Neighborhood Guide – Wicker Park

By | Neighborhood Guides, Property Management

Welcome to the Wicker Park (sometimes referred to as the Wicker Park/Bucktown) Neighborhood!

Over the last decade, Wicker Park (and Bucktown), centered around the six-corner intersection of Milwaukee, North and Damen Avenues, has gradually transformed from a gritty-come-artsy neighborhood of galleries and dive bars to trendy, upscale living and entertainment. This is mainly due to an increase of homes being bought, renovated and built. However, all the flavor has not been bought out of the area as Wicker Park remains a vibrant hub of culture and commerce in Chicago, riddled with boutiques, restaurants, cocktail bars, concerts venues and condos.

FACTS

The Wicker Park Historic District is on the National Register of Historic Places listings in Chicago. Much of Wicker Park was also designated as a Chicago Landmark District.

2000’s quintessential John Cusak film, High Fidelity, was filmed here—Rob’s store was located at the corner of Milwaukee and Honore.

In 2001 a season of MTV’s The Real World, was filmed in Wicker Park in the loft building currently home to Cheetah Gym.

Milwaukee Avenue’s Costa Rica Restaurant, Irazu, has been featured on PBS television’s Check, Please!, Food Network’s Diners, Drive-ins and Dives (Guy Fieri sampled several dishes) and Food Network’s The Secret Life of Milkshakes. The burritos competed in ESPN’s FiveThirtyEight’s 2014 Burrito Bracket.

Some notable residents include:

WWE wrestlers, Colt Cabana and CM Punk; singer/songwriter, Liz Phair; former Smashing Pumpkins guitarist, James Iha; singer/guitarist for The Alkaline Trio, Matt Skiba.

EATS

Chicago is a food city! With too many great restaurants to include them all, consider this a quick start guide to your flavorful adventures… enjoy exploring your new neighborhood eateries!

Antique Taco
1360 N. Milwaukee Avenue
Owned and operated by a husband and wife team, indulge yourself in a seasonal menu of gourmet tacos & Mexican appetizers doled out in a shabby-chic, counter-serve space.

Big Star
1531 N. Damen Avenue
Probably one of the best outdoor patios in the city and their tacos speak for themselves. No matter what time of day, this place is jammed with people eating the Mexican street food and drinking. Heads up though, this popular spot is cash only.

Piece Brewery and Pizza
1927 W. North Avenue
This isn’t your typical pizza joint. The go-to specialties? A New Haven, CT style pizza smothered in red sauce, topped with garlic, extra parmesan, and olive oil with notably no mozzarella (though cheese is an option as well as other toppings) paired with award-winning, brewed-on-premise, small-batch beers. Fun Fact: Doug Sohn chose Piece to host his Hot Doug’s swan song–a fusion of encased meat and pizza, named the Atomic Bomb after the menu mainstay from his much-missed eatery.

Trencherman
2039 W. North Avenue
Formerly a Russian bath house, the space is now host to a Modern American menu influenced by Chicago’s rich neighborhood history, with a ridiculous Wednesday $10 burger and beer special!

Mindy’s Hot Chocolate
1747 N. Damen Avenue
Hip, family-friendly American eatery known for it’s seasonal menus, rich desserts and of course, hot chocolate.

The Bongo Room
1470 N. Milwaukee Avenue
The place to go for all your brunch desires. Features inventive pancakes and other updated American breakfast and lunch classics.

DRINKS

As previously stated, consider this a quick start guide to begin your exploration!

The Violet Hour
1520 N. Damen Avenue
This swanky cocktail lounge has a distinctly speakeasy vibe and the carefully constructed cocktails are excellent. You won’t find a sign on the door, and the decor is completely and unarguably gorgeous.

Emporium Arcade Bar
1366 N. Milwaukee Avenue
Bring out your inner child with 40+ 25¢ arcade games to provide the entertainment and 24 rotating craft beers and 50+ kinds of whiskey to provide the fuel!

Bangers & Lace
1670 W. Division Street
Named after sausage (“bangers”) and “Brussels lace,” i.e., beer foam on the edge of a glass (“lace”), this Division Ave upstart harnesses a stellar draft selection and knowledgeable staff that draw in a lively mix of beer aficionados and neighborhood clientele at all hours and seasons. They even offer two-ounce sample beers and a sweet patio space in the summer!

Estelle’s
2013 W. North Avenue
At this low-key sanctuary in the Milwaukee-North-Damen intersection, no one is trying to out-cool anyone—the uncool simply can’t hang and leave. Comfortably strike up a conversation with a new friend over a PBR ($2 on Tuesdays!) and some late-night bar food, served till 3am, after one of many shows at Subterranean, the venue next door.

PARKS AND INTERESTS

RSVP Gallery
1753 N Damen Avenue
Technically in Bucktown, RSVP is a design and fashion-minded shop selling high-end clothing, art and wares for those young of heart and thick of wallet. Heavy streetwear and fashion-blogger influence.

Mildblend Supply Co.
1342 N Milwaukee Avenue
With “a rustic and recycled interior,” MildBlend Supply Co. (formerly Untitled, a Chicago legend) carries high-end denim along with all type of trendy men’s and women’s casual and fine clothing, leather goods, shoes, bags, and grooming products. They are also pioneering supporters of the Made In USA movement.

Green Music Fest
Intersection of Damen, North and Milwaukee
This environmentally conscious Wicker Park street festival takes over Damen Ave, bringing green vendors, food and biodiesel- and bicycle-powered live music to the neighborhood for two nights each summer.

LVL3
1542 N. Milwaukee Avenue
SAIC graduate, Vincent Uribe opened this gallery in 2009, just after he finished his freshman year. Years later, he’s still runs this space and is presenting some the area’s most exciting group shows, gathering work from artists all over the country.

Wicker Park
1425 N. Damen Avenue
This four-acre recreation area may be small for a popular park, but when the weather is warm you will be able to find residents sitting by the fountain, playing basketball on the courts and kids playing on the swings. A field house in the middle of the park contains a gymnasium and meeting rooms, overlooking a lush public garden that is tended by members of the community.

Wicker Park Farmer’s Market
1425 N. Damen Avenue
Each Sunday, a small grouping of farmers, vendors and shoppers descend on Wicker Park for the neighborhood’s farmers’ market, which features fresh fruits and veggies, baked goods, meats, cheeses, and flowers. The market begins in May and ends in October.

The 606
also referred to as The Bloomingdale Trail – various access points along Bloomingdale Avenue
This old elevated train line has been given new life as a connective system of parks, access points, and multi-use exercise trail.

TRANSPORTATION

The L – Blue Line
Easy access to the CTA Blue Line services this area. Stations are located at Division, Damen and Western.

Bus
The following bus routes are also readily available:

North-South bus lines:

  • #9 Ashland Avenue
  • #50 Damen Avenue
  • #49 Western Avenue
  • #56 Milwaukee Avenue

East-West bus lines:

  • #70 Division Street
  • #72 North Avenue
  • #73 Armitage Avenue
  • #74 Fullerton Avenue

Proximity to Downtown
Obviously there is a bit of fluctuation depending on where exactly you live within the neighborhood, but Wicker Park is approximately 5 miles from Chicago’s Downtown Loop. Driving (without traffic) would yield about 13 minutes taking I-90 East. If traveling via the CTA, allow approximately 45 minutes.

Surrounding Areas
Bucktown, West Town and Ukranian Village are your closest neighbors. The awesome thing about the surrounding neighborhoods is that they offer up different atmospheres that are unique to them…and quite honestly, that’s what makes Chicago great.

 Get in touch with our experts to learn more about this wonderful neighborhood.

 

 

Security Deposits vs. Move-In Fees: Which Is Better for Your Property?

By | Property Management

In the increasingly competitive rental market in Chicago, it’s becoming more and more common for landlords to charge non-refundable move-in fees instead of the more traditional security deposit. There are a number of reasons for the shift to this policy, and in order to decide which is better for you and your properties, it’s important to learn more about why these fees are becoming a standard part of the rental agreement in Chicago.

Tenant Rights for Security Deposits

One of the biggest reasons landlords and property owners are choosing to charge non-refundable fees instead of security deposits is the risk potential that accompany even small, seemingly-insignificant mistakes. For example, if a landlord forgets to date the receipt for the security deposit, tenants are eligible for an immediate return of the deposit, as well as other damages, which can equal up to two times the initial security deposit amount, plus court costs and associated legal fees. With the risk of situations like these arising, it’s not surprising that the non-refundable move-in fee is getting more popular.

What’s more, there are very detailed regulations associated with how landlords have to manage, store, and pay interest on the collected security deposit. While security deposits can be helpful in eviction processes to cover a tenant’s unpaid rent, they may not always be the most ideal choice for your properties—even with helpful property managers taking care of your paperwork and books, the process of dealing with security deposits can sometimes be complicated. When it comes to streamlining the rental process, move-in fees can be a great way to save time and frustration, but it’s up to you to determine what’s right for your properties. If you’re stuck, a property management company can help reveal all the potential benefits and drawbacks of security deposits and fees, allowing you to make the most informed decision.

 

Benefits of Charging Non-Refundable Move-In Fees and Pet Rent in Chicago

For renters, move-in fees have obvious benefits—handing over the equivalent of one or more months of rent as a security deposit can be a tough financial hurdle, and move-in fees are traditionally much less expensive than security deposits—averaging around $200-400 for Chicago tenants.

The benefits of charging non-refundable fees don’t just apply to tenants, though. For landlords in Chicago, charging move-in and pet fees eliminates the need for separate, often-complicated accounts to hold deposits in, and it guarantees immediate income that can be used for property maintenance or other costs.

With non-refundable fees for move-ins, landlords have immediate access to funds that they can use for taking care of routine maintenance and other tasks that need to be done between leases—changing locks, updating directories, painting, small repairs, etc.

Non-refundable fees are easier to keep track of, as well, meaning less work overall for landlords—what’s not to like about that? By collecting fees instead of deposits, you’ll save the time that you would have spent working to ensure you’re meeting all the requirements for holding onto security deposits. As far as tenant rights and landlord responsibilities are concerned, move-in fees are becoming the clear winner for many property owners because they’re convenient, quick to collect, and easy to manage.

Pet Deposits and Pet Rent In Rental Agreements

In addition to choosing between move-in fees or security deposits, another important aspect of any rental agreement in Chicago is how the landlord will manage pet deposits or pet rent. There are a lot of benefits to allowing your tenants to keep pets in their homes, but it’s important to make sure you’re protected, too. Many property owners choose not to charge separate pet deposits and security deposits, and for good reason—if a tenant causes damage that is unrelated to the pet, landlords aren’t allowed to use their pet deposits to cover the damage. Pet deposits can only be used for pet-related damages and maintenance, so many landlords instead choose to simply charge an additional amount of pet rent per month.

By charging an additional amount for pet rent, landlords ensure they’ll have the necessary funding to take care of any pet damage, and they’ll also have guaranteed extra income every month, increasing the profitability of the property.

Your Best Option

Making the choice between charging fees or security deposits will depend on a number of factors—beyond the pros and cons of each option, it can ultimately depend on your personal preference as a landlord. Property management companies can offer valuable guidance for what the best course of action may be. Here at Lofty, we are excited to be of service any time you need help deciding whether to charge fees or deposits for your apartments and condos. Reach out today and see how we can help you live the life you deserve.

Speak with one of our experts to find out how we can supercharge your investment.

Fulton Market Real Estate Brokerage

Neighborhood Guide: West Loop Fulton Market

By | Neighborhood Guides, Property Management

Welcome to the West Loop Neighborhood!

With one of the most happening food scenes in Chicago due to some of the best restaurants and bars in the city, some might say the West Loop is the Best Loop. No doubt, it has become a very desirable and active area! Fulton Market and Randolph’s Restaurant Row are just a few of the main attractions in this popular neighborhood!

FACTS

The West Loop was once strictly industrial. The hip, industrial vibe is still alive today, with former manufacturing and warehousing buildings converted to loft condos, restaurants, nightclubs, event spaces, showrooms and art galleries.

Oprah Winfrey’s syndicated television show, Oprah, was previously produced in the West Loop at Harpo Studios.

Google recently reclaimed and remodeled the old Cold Storage building for their Chicago Headquarters. The southeast corner of the building is home to Cold Storage Oyster Bar and Swift & Sons Steakhouse.

EATS

Chicago is a food city! With too many great restaurants to include them all, consider this a quick start guide to your flavorful adventures… enjoy exploring your new neighborhood eateries!

Au Cheval
800 W. Randolph Street
Awarded the “Best Burger” title by Bon Appetit magazine in 2012, and has since ballooned with popularity. Au Cheval goes through about 400 hamburger patties each weekday and up to 500 a day on the weekend. Head to Au Cheval when it will serve you best: for a burger and a beer at the bar.

Publican Quality Meats
825 W. Fulton Market Street
Located in the neighborhood’s meat-packing area, this a butcher shop, a sandwich joint, a grocer and a bakery. Menu offerings include house-made charcuterie, artisanal cheeses, freshly baked breads, specialty coffee drinks and rustic soups and sandwiches. The little sister restaurant of The Publican, PQM acts as The Publican’s private dining room by night.

Little Goat
820 W. Randolph Street
Stephanie Izard’s bakery and diner serves up reimagined comfort food. As the sequel to her popular Girl & the Goat, the restaurant that put the West Loop on the map, Little Goat has redefined the small-plate trend and proved that winning Top Chef can actually translate into real world success!

Chicken & Farm Shop
113 N. Green Street
Located in Soho House, serving rotisserie-cooked, free-range birds sourced from Pine Manor Farm in Indiana—birds come whole, by the half or quarters. The chickens are continually roasting on a rotisserie behind the bar, so they come out hot and juicy in minutes. You will also be able to enjoy classic American sides and British dessert “puddings.” Craft cocktails, beer and wine offered in a stylish, industrial diner featuring exposed brick walls and big windows.

The Corned Beef Factory
1009 W. Lake Street
An offering of tender, slow-cooked meats awaits you at this cozy, spot located in what was once the front office of the 60+ year old Ex-Cel corned beef factory, an old-school meatpacking district staple that used to sell wholesale briskets out the back door. The meats are cured on site and boast exceptional flavor, and every sandwich comes with house made potato chips and a perfect pickle.

High Five Ramen
112 N. Green Street
Journey under Green Street Meats and feel the vibe of a gritty basement ramen shop in Tokyo. Spice is the name of the game in this hidden gem, but there are plenty of mild bowls to choose from as well. Slushy cocktails are a must at this hip, subterranean eatery.

DRINKS

As previously stated, consider this a quick start guide to begin your exploration!

The Beer Bistro
1060 W. Madison Street
A low-key, tavern with a neighborhood feel just steps from the high-profile establishments of Randolph Street, The Beer Bistro carries upwards of 100 beers. Enjoy one and strike up a conversation with your beer-geek bartender or another good-natured patron.

Fulton Market Kitchen
311 N. Sangamon Street
Part restaurant, part lounge and part art gallery. Grab a seat in this chic warehouse space on one of the couches or at the bar and check out the artwork that is created by local artists and a street art-inspired mural.

Haymarket Pub & Brewery
737 W. Randolph Street
A throwback brewpub that offers a rotating selection of housemade craft beers and pub fare, as well as occasional live music. Even with so many outstanding restaurants in close proximity, this is a great place to grab a drink and a bite.

RM Champagne Salon
116 N. Green Street
Enter this champagne bar through an unmarked alleyway, where glowing strings of lights lead to a cobblestone courtyard! RMCS serves American cuisine small plates in an elegant setting replete with marble fireplace and chandeliers.

City Winery
1200 W. Randolph Street
A veritable one-stop-shop, this unique, 30,000 square foot venue is not only Chicago’s premier  wine and fine dining experience with attached concert venue, but also offers food and wine classes, flexible event space and seem to be on a noble, artistic quest to find the perfect combo of drink, food and sound that will leave you breathless and satisfied.

PARKS AND INTERESTS

Randolph Street Market Festival
1340 W Washington Boulevard
Typically occurring on the last weekend of each month, RSMF boasts 100+ vendors selling goods from antiques, furniture, clothing. During the warmer weather months of May through September, the market features an outdoor spot, with more vintage shopping and a beer garden. Shop for vintage clothes and jewelry, enjoy a fancy food market and global goods or bring your own items for appraisal. Tickets are available at a discount online or can be purchased at the gate.

Mary Bartelme Park
115 S. Sangamon St
At 1.4 acres, this city park is very kid-friendly with swings, slides and a lot of other cool things on which to run around—this park also features pieces that allow for inventive, non-linear play without traditional play equipment! For the dog in your life, there is a sunken dog park which includes a continuously filling, oversized dog bowl, ramps, ledges, steps, and an artificial grass exercise area. You can also find a “viewing hill”, up to six feet high that provides an incredible view of the park with the Chicago Skyline as the backdrop.

Brooklyn Boulders
100 S. Morgan Street
An expansive rock climbing facility which offers classes for beginners to advanced climbers. The building is also home to an “Active Collaborative Workspace,” a co-working office in which you may participate in a little physical activity during the workday. Gee, wonder what that is…

Aspect Ratio
119 N. Peoria Street
The go-to place for video art. Here is the only commercial video art space in the city so be sure to check out the top film-focused exhibitions.

Union Park
1501 W. Randolph Street
From the 1920s through the 1950s, this park was well-known for cultural and social events. Many notable musicians performed there, including: Thomas A. Dorsey; trumpeter Sunny Cohn; and jazz pianist Ramsey Lewis. In the last 12 years, the park has been home to many music and art festivals, including the annual Pitchfork Music Festival, usually held in July, featuring artists from all different music genres including rock, metal, alternative, electronic, pop, hip hop, jazz and more!

TRANSPORTATION

The L

Easy access to the CTA Blue, Green and Pink Lines service this area. Stations are located at Clinton and UIC Halsted (Blue Line), Morgan and Clinton (Green and Pink Lines).

Bus

The #20 bus (Madison) services the West Loop.

Proximity to Downtown

Obviously there is a bit of fluctuation depending on where exactly you live within the neighborhood, but the West Loop is approximately 2.5 miles from Chicago’s Downtown Loop. Driving (without traffic) would yield about 10 minutes. If traveling via the CTA, allow approximately 15 minutes.

Surrounding Areas

Greektown, Fulton River District, West Town and Little Italy are your closest neighbors. The awesome thing about the surrounding neighborhoods is that they offer up different atmospheres that are unique to them—quite honestly, that’s what makes Chicago great.
Welcome home!

Thinking about purchasing or renting property in The West Loop? Get in touch with our experts to learn more about this wonderful neighborhood.

Real Estate Brokerage Rogers Park

Neighborhood Guide: Rogers Park

By | Neighborhood Guides, Property Management

Welcome to the Rogers Park Neighborhood!

Rogers Park has two main distinctions as a Chicago neighborhood: First, as the city’s northernmost neighborhood; second, it is considered one of the most diverse neighborhoods in Chicago in terms of population, culture, and even natural wonder.

Despite the seemingly far distance from Downtown, there is plenty of easy accessibility to all forms of public transportation. This means that the unique dining, arts, culture and entertainment found in Rogers Park are never far away. This dynamic neighborhood boasts bright, fresh murals and artwork in newly-updated ‘L’ stations along the Red and Purple lines.

Rogers Park wins the second distinction as people from all over the world call this neighborhood home. There is no dominant ethnicity in this neighborhood as residents speak nearly 40 different languages and have roots from over 80 countries. Howard and Clark Streets are known as the “Commercial District”, while the Glenwood Avenue Arts District and Jarvis Square are home to a pretty robust theater scene and music clubs, in addition to late-night dive bars, galleries, studios, and coffee shops.

Enjoy the sound of waves crashing! The lakefront is within ear shot, and nearly all the streets leading east end at public beaches and parks on Lake Michigan. Beautiful views at dawn give way to breezy afternoons along Lake Michigan. Cyclists may utilize the myriad bike lanes on winding side and main roads to maximize their new locale, and urban naturalists will find an entirely different set of florae and faunae than they are used to seeing in Chicago.

FACTS

The Rogers Park area was developed on what once was Native American trails, now known as Rogers Avenue and Ridge Boulevard. The Potawatomi tribe (among other regional tribes) would settle in Rogers Park seasonally. Indian Boundary Park, west of Rogers Park and Pottawattomie Park near Clark Street and Rogers Avenue, pay homage to these historical roots.

Rogers Park has a higher rate of residents with Master’s, Professional, and Doctorate degrees than the state average. In addition, the amount of residents that work for not-for-profit institutions and organizations is almost twice as high as the state average.

Some notable residents include:

Former First Lady, Betty Ford; actresses Tina Fey and Lara Flynn Boyle; Olympic speed skater, Shani Davis; NFL Hall of Famer, Fritz Pollard; U.S. House of Representatives, Jan Schakowsky; State Senator, Dan Kotowski.

EATS

Capt’n Nemo’s
7367 N. Clark Street
A Chicago landmark since 1971, serves up some of the “Best Soups, Best Chili and Biggest Best Subs and some of Chicago’s Best Italian Beef.”

Jamaica Jerk
1631 W. Howard Street
Is locally owned and operated by Chef Waite, who brings a culinary degree from the Cooking and Hospitality Institute of Chicago (CHIC) and an experienced expert with Jamaican cuisine. His menu will delights your taste buds with delicious Jamaican and Caribbean food in a fun, feel like you are on vacation, tropical atmosphere. This restaurant prides itself on made-from-scratch fare, with only top quality ingredients, including spices, vegetables, and fresh fruits.

Heartland Cafe
7000 N. Glenwood Avenue
Heartland Café opened it’s doors in 1976 with a vision to serve “good wholesome food for the mind and body”. This community favorite takes great care and effort in finding local, organic, sustainable, socially conscious ingredients whenever possible. It’s also a great place for a date.

La Cazuela
6922 N. Clark Street
This isn’t your typical mexican restaurant! La Cazuela offers delectable breakfast, vegetarian meal options, wraps, seafood, and Mexican cuisine. Every dish prepared at La Cazuela is made with fresh ingredients and cooked to perfection.

Act One Pub
1330 W. Morse Avenue
Best described as a combination of a neighborhood favorite and a destination dining experience. Features live entertainment and high quality American cuisine, so you can find all the comfort of a neighborhood pub coupled with the sophistication of a first class dining experience. There is a carefully crafted global wine and beer menu to represent the high standards you would expect in fine dining. Next door is Mayne Stage, which makes it the perfect spot to complete a special evening out on the town.

BopNGrill
6604 N. Sheridan Road
This quick-serve spot has been featured on the Food Network, in Timeout Chicago and the Redeye. It features street food with a international (mostly Korean) influences and bacon: kimchi fries; a Bavarian burger served on a pretzel with Dusseldorf mustard; Japanese chicken Katsu!

Taste of Peru
6545 N. Clark Street
Casual Peruvian BYOB eatery specializing in traditional cuisine (the owner is native to Peru) and lively native folk music.

Ethiopian Diamond II
7537 N. Clark Street
Friendly, casual restaurant and bar featuring Ethiopian stews and weekly live music.

DRINKS

Royal Coffee
6764 N. Sheridan Road
Pure Ethiopian Highland Coffee straight from the Ethiopian farm to your cup. The coffee comes from an elevation of 4,920 feet and it is grown in one of the richest coffee growing areas in Ethiopia. The beans are then sun dried by Ethiopian farmers and they are imported directly to the Royal Coffee Headquarters in Chicago. The boldness of “Royal Coffee” will keep you going through your day.

Red Line Tap
7006 N. Glenwood Avenue
Here there is a good chance you will often find yourself wrapped up in a conversation over a wide selection of domestic and imported beers, as well as classic draft offerings and cocktails.

PARKS AND INTERESTS *disclaimer – your new neighborhood has more to offer! Listed below is just a start…enjoy exploring!

Rogers Park/West Ridge Historical Society
1447 W. Morse Avenue
Established in 1975 by local residents who believed this Chicago neighborhood was a place too exciting not to celebrate, they find, collect, preserve and share the story of this diverse community. Today, the Society serves the community through its publications, architectural tours, and various educational and outreach efforts.

The Mile of Murals
Glenwood Avenue
An 10 year, ongoing, community-based public art initiative to paint a full mile of murals along the CTA Red Line track from Estes Avenue to Pratt Boulevard along the Glenwood Avenue train line. The project will result in 19 large-scale murals: ten block-long walls, seven viaduct walls, and two overpasses. New artists and themes are selected every year through a specific selection process determined by arts professionals and community leaders.

Emil Bach House
7415 N. Sheridan Road
The Bach House, designed for Emil Bach in 1915, is one of the last of Frank Lloyd Wright’s designs for a small urban house. The house is designed with its entrance almost hidden from Sheridan Road, to ensure privacy and reflects the importance of family life, according to Wright. This is Chicago’s only Wright residence open for vacation rentals and private events.

B1E Gallery and Sculpture Garden
6902 N. Glenwood Avenue
B1E is a well known art gallery in the Glenwood Avenue Arts District. Outside is a very vibrant “sculpture garden” you can view on Glenwood Avenue.

Greenleaf Art Center
1806 W. Greenleaf Avenue
Provides studio and exhibition space for 50+ local artists and is home to five business enterprises. The center is host to a variety of exhibitions, open studio events, art salons and creative workshops throughout the year.

Loyola Park and Beach
1230 W. Greenleaf Avenue
A large, expansive beach which offers plenty of open room and sights of the famous city skyline at a distance. Loyola Park sits on approximately 21.5 acres. The field house is equipped with two gymnasiums, a woodshop, a boxing center and clubrooms available to rent out. Outside, the park offers a senior baseball and a softball field, a two-hoop basketball court, sand volleyball courts, four tennis courts, a playground, and a 2/3-mile walking trail along the beautiful beach and Lake Michigan. Beach season begins the Friday before Memorial Weekend and goes through Labor Day.

TRANSPORTATION

The L
Easy access to the CTA Red Line services this area. Stations are located at Loyola, Morse, Jarvis and Howard.

Bus
Bus #22 (Clark) or #147 (Outer Drive Express) are also accessible for this neighborhood.

Proximity to Downtown
Obviously there is a bit of fluctuation depending on where exactly you live within the neighborhood, but Rogers Park is approximately 12 miles from Chicago’s Downtown Loop. Driving (without traffic) would yield about 25 minutes taking Lake Shore Drive. If traveling via the CTA, allow approximately 55 minutes.

Surrounding Areas
Edgewater, Andersonville, West Ridge and the city of Evanston are your closest neighbors. The awesome thing about the surrounding neighborhoods is that they offer up different atmospheres that are unique to them…and quite honestly, that’s what makes Chicago great.

 

 

 

Chicago Property Management

Staying Safe And Warm Over The Holidays

By | Property Management

Here at Lofty, we  want to see people be warm and safe over the holidays, perhaps curled up by the fireplace or sipping hot cocoa. It can be easy to get distracted with the all the holiday excitement going on, but there some things you pay attention to, in order to avoid an unfortunate incident over the holidays. For example, did you realize a best practice is to keep flammable material at least three feet away from any heat source (i.e. furnace, space heater, fireplace) and Christmas trees with lights? Did you know the curtains are commonly overlooked as flammable material?.Here are a few key tips to staying warm and safe over the holidays.

Doors and Windows

We have already gotten a taste of the Chicago cold and as Chicagoans, we know it is about to become really cold. Chicago winters can bring ice, snow, and below zero temperatures. The easiest way to keep the home insulated is by closing windows and doors, securely. You may want to consider putting plastic on the windows and making sure you have a draft guard on the door to keep warm air in and cold air out.

Furnace

Past winters have brought on extreme low temperatures. A reputable property management company will be able to assist with a checklist of “winter proofing” tasks for your home. The name of the game is minimizing emergencies during this frigid season. For example, conduct a furnace maintenance inspection to keep the furnace working properly. Keep anything that can burn at least three feet away from the furnace, as well as, keep a “kid free zone” around the furnace avoid any unnecessary accidents. Also, test smoke alarms monthly to make sure they work. To see more tips, check out Lofty’s blog on Winterizing Your Home.

Space Heaters

Electric space heaters need to be plugged into a wall socket, not an extension cord. Most extension cords can’t handle the extra wattage a space heater needs, so take an extra precaution and check to make sure the space heater is properly rated and grounded.

Home is where the hearth is / The hearth / Fireplace safety tips

We have yet to meet someone who did not enjoy the warmth and coziness of a fire in the fireplace. The fireplace, to be working properly and safely, should be properly maintained. Read more fire safety tips.

Tips to warm your home and enjoy the holidays with a fire is:

  1. Have proper fireplace tools on hand, like a pick, brush and a shovel. The pick will help position the wood around the hearth while the brush and shovel will help make cleaning up the leftover ash quick. Do not have the tools on hand? It might be worth contacting your property management company (or landlord) to see if they can supply those and instructions on how to use.
  2. New, dry wood is the best food for the fire and will keep the warmth for a cozy evening at home.
  3. A fireplace screen will be helpful to keep the sparks in the fireplace and not on the carpet, rug, floor or a person.

A fireplace, under the proper supervision is a comfy, memory making staple during the holidays. Remember to never leave a fire burning unattended. A fire in the fireplace is not an intentional, constant, source of heat for the whole home (nor is an oven!), but rather something to look forward to on a cold day, after a long commute, or just an excuse to curl under a blanket with a cup of hot cocoa.

Vacations

For the snow bunnies who escape the Chicago cold for warmer weather, it is important to care for the home while away. Whether it is for a short weekend getaway or for the entire winter season. If your home or rental will be unoccupied for more than a day, it is recommended to turn your heat down…not off. An ideal temperature is 66 degrees, per the Chicago Building Ordinance. Low heat, or even heat that has been turned off, runs the risk of pipes freezing and bursting.  Another tip if planning on leaving is setting various lights on timers. This will give the illusion that your home is still occupied while you are away to discourage intruders.

Christmas Trees

If you choose to celebrate the holiday with a live tree, be sure it stays fresh and keep it watered. For if it dries out, it can become a fire hazard. Keep the trees away from hot lights and open flames. Artificial trees are a lot safer especially with modern LED lights that run cooler, but they sure do not give off that pine fresh scent!

Speak with one of our experts to find out how we can supercharge your investment.

 

 

property management glenview

Neighborhood Guide – The Glen

By | Neighborhood Guides, Property Management

Welcome to the The Glen!

Electric
ComEd
www.comed.com
(800) 334-7661

Gas 
Nicor
www.nicorgas.com
(888) 642-6748

Garbage/Recycling/Landscape Waste Service
Groot
www.groot.com
(800) 244-1977

Water and Sewer
Contact the Resolution Center at (847) 724-3112 to set up a water and/or sewer account and to ensure that a final water read has already been scheduled by the previous owner/renter.

Television and Cable
Comcast
www.comcast.com
(866) 594-1234

WOW
www.wowway.com
(866) 496-9669

ATT
www.att.com
(800) 222-0300

FACTS

In 1995, the Naval Air Station Glenview was closed as part of the Base Realignment and Closure military restructuring process. 1,121-acres was deeded back to Glenview by the U.S. Department of Defense.

EATS AND DRINKS

BRAVO! Cucina Italiana
2600 Navy Boulevard
Family friendly, upscale yet affordable dining featuring classic Italian food and inviting atmosphere with a Roman ruin decor.

The Curragh Irish Pub and Restaurant
1800 Tower Drive
A great experience for the entire family with authentic Irish fare, a wide selection of beer and wine, and even live entertainment. During the summer, enjoy the ample seating of the patio!

Eggsperience Pancakes & Cafe
2000 Tower Drive
Looking to brunch or even just grab some breakfast for lunch? Here, breakfast and lunch is served up daily.

Flight Wine Bar
1820 Tower Drive
Features an extensive wine list with over 35 wines by the glass options with origins from all over the world. The menu best described as American contemporary, handcrafted comfort food, that is locally sourced when possible and always raised, harvested or produced sustainably.

Jameson’s Original Charhouse
2601 Navy Boulevard
Best known for steaks, chicken and seafood, they also offers a wide variety of crisp salads and freshly made soups and sides. New creations are made daily using only the highest quality ingredients.

Mingle Juice Bar
1830 Tower Drive
Cleverly concocted juices, smoothies, acai bowls, seasonal ingredient soups, salads, and other delectable foods to delight your senses and fuel your day!

Ra Sushi
2601 Aviator Lane
A Japanese fusion restaurant known for its inventive sushi, cocktails & happy-hour deals at the bar.

Ted’s Montana Grill
1811 Tower Drive
Authentic, like you are living on the ranch, Craftsman-style food that specializes in bison.

Uno Mas Cocina & Tequila
1831 Tower Drive
Serves authentic Mexican food with a modern flair; boasting menu items that have a twist to what you would typically find in a Mexican restaurant.

Yard House
1880 Tower Drive
High-end sports-bar chain with a huge menu of American, made-from-scratch dishes. Also offer an extensive list of draft beers; over 100 ales, craft beers, IPA beers, lagers and imported beers on tap.

Your Pie Pizzeria
2085 Tower Drive
Feeling creative? You get to choose your dough, sauce, cheese and toppings at this pizzeria chain with gelato and microbrews, to truly make your perfect, satisfying meal.

PARKS

Park Center
2400 Chestnut Avenue
A multi-purpose community center, one of the largest in Illinois! The Park Center has an indoor pool (Splash Landings Indoor Aquatic Complex), Park Center Health & Fitness, Park Center Preschool, Glenview Senior Center, along with many programs including arts, dance, and adult and youth sports programs.

COMMUTE

Proximity to Downtown
Obviously there is a bit of fluctuation depending on where exactly you live within the neighborhood, but The Glen is approximately 23 miles from Chicago’s Downtown Loop. Driving (without traffic) would yield about 35 minutes taking I-94 East. If traveling via the Metra Rail, allow approximately 50 – 60 minutes.

 

Thinking about purchasing or renting property in The Glen? Get in touch with our experts to learn more about this wonderful neighborhood.

 

Chicago property management

5 Simple Tips For Writing A Great Rental Property Ad

By | Leasing

The first step in finding a great tenant is getting their attention! A few tips for writing a really great rental property ad can go a long way in quickly securing a qualified tenant that is respectful to your property and pays on-time!

Have you ever browsed through the rental property ads on sites like Zillow, Trulia, Zumper, Rad Pad or Craigslist? Some ads grab your attention while others you flip right past. Following these simple steps can help you create the attention grabbing ads that will get your property rented in a timely fashion.
#5. Attention Getters

It all starts with headlines. You need to reel them in with the headline and pique their interest so they can’t wait to learn more. Two examples:

  • 2bd / 1ba
  • 2 Large Bedrooms, 1 Oversized Bathroom

Both say there is a place that has 2 bedrooms and 1 bathroom. By adding certain exciting, descriptive details, you can increase interest. You want to keep the headline short and snappy and give just enough information to make someone want to learn more!

Here are two more examples:

  • 2 Large Bedrooms, 1 Oversized Bathroom
  • 2 large, airy bedrooms with GREAT VIEWS and a SUPER-SIZED bathroom

See how adding just a couple of words with capitalization makes them pop so much more? Use ADJECTIVES in the headline and capitalize them.

#4. Hold Nothing Back

It is ideal to fill the space available as you tell the story of why this home is the perfect home for the reader. Make sure to talk about the amenities of the property and where it is located; include information on the conveniences like shopping, restaurants and parks nearby. It is up to you to bring the property to life through your words, allowing the prospective renter to picture themselves living there and what it might feel like. That feeling they get—from the right renter—it is worth every second of work you have done and is key to establishing a solid relationship.

You can use words that offer information about the little details of the rental. Some good examples of that are: “charming chair rails”, “vintage hardwoods”, “move in ready” or “turnkey”. The main idea here is that words matter to spark interest and achieve your desired results. Be descriptive in your explanation to create an opportunity for the reader to make a mental image of themselves enjoying their new space.

#3. Pictures Worth A Thousand Words

Actually, a great photo says 1,000 of the right words that will yield more interest, more showings, and a reduced market time. Great photography truly does more to convey than any words ever could.

The trick to photographing a space is using the geometry to your advantage. Stand in the corner of the room, preferably a doorway, and aim the camera in a direction that arranges all vertical lines straight up and down. When combined with horizontal surfaces that appear to zoom out of the frame from the farthest point from the viewer, the room appears to continue past the edge of the photo which gives the impression of more space. At Lofty, we offer in-house professional photography because we know from proven experience how important photos are to the end goal.

Natural light is a photographer’s best friend when utilized correctly. The on-camera flash creates harsh and direct lighting from the front that casts a cold, blue color over the subject and a hard shadow. Natural light mixed with interior lighting can help you achieve softened shadows and highlights with a smooth gradation that helps to create a visual balance through the image.

#2. Priced To Move

Being direct with your rent price is definitely the way to go. If you aim lower than you will actually charge, with the intent to attract more attention, it will be the kind of attention you don’t want: renters who cannot afford your rent. If you price too high and don’t budge, renters will look elsewhere without so much as an email. When you are secure with your pricing, you will attract the renters you want.

If you start far enough in advance of your vacancy date, you can allow the market to help you find the right price. By starting a bit higher and adjusting incrementally, the market will guide your price based on attention.

#1. Finally, Last Step!

Check and recheck the advertisement for spelling, grammar and pricing accuracy before you publish. Even if you are sure about your writing abilities, have someone else review to double check that it makes sense and is easy to understand. Follow these guidelines to make sure your ad stands out and beats the competition!

 

Speak with one of our experts to find out how we can supercharge your property’s listing.

 

The Ultimate Guide To Listing At The Right Price

By | Property Management

Are you looking to lease your property and not sure what price to list? Here at Lofty, we’ve had the experience of listing hundreds of properties in the Chicagoland area. In this guide, we share exactly how to list your property like a professional.

Choosing a rental price for your home or condo can be a tricky task. You don’t want to set the price low and miss out, but you don’t want to ask too much. No one wants to be that house that has been listed for six months. Like a teenager without a date to the prom, this is something to be avoided at all costs. Staying realistic is the key, along with a little legwork and market research. As a landlord your goal is to minimize vacancy to boost profitability and reduce risks associated with an unoccupied place.

When tasked with setting an accurate rent price, your first instinct may be to charge as much as the market can bear. But there are some things to consider before choosing a rental price.

Know The Market

Market demand will dictate your rent price. To get the best idea of what the current market demand is in your area, assess value. A first simple step is to have a look at similar properties available for rent in your area to gauge what price they are listed for rent. From Craigslist to Zillow and even the classified section of your local newspaper—if you like to kick it old school—can be great starting points.

Determining Market Value

The best next step is to consult a real estate professional to secure a Comparative Market Analysis. A CMA will evaluate similar, recently rented units (called comparables or comps) that are near your property. These comps assist in establishing the current market value of your property. There are several factors to keep in mind when reviewing rented comps: price, market time, seasonality, location compared to your property, room sizes, amenities, and so on.

With these comps in mind, along with the active listings previously discussed, you are now prepared to analyze the data to achieve your list price. Get your analytical thinking hat on and strap in! Or leave it to the professionals at Lofty who offer you a free market analysis!

This process should be repeated each and every time you relist your property to account for any market shifts. Even the most experienced real estate professionals rely on an accurate CMA to determine the market price. For example, if there is a downturn in the economy the demand for rental properties may increase as people can no longer afford to buy their own homes and will choose to rent instead. A dip in the economy may also benefit landlords who own smaller properties and apartments as people look to downsize in order to save money. The general rule of thumb is that the greater the demand the higher the rent you can charge, and visa versa.

It also doesn’t hurt to be competitive. Offering a slightly lower price than the average comparable property in your area may win over a renter quicker.

Think Like A Tenant

Imagine your potential renters and how they are searching for their next home. If their max rent price is $1,800, they are likely to set $1,800 as their maximum search price. If you were to set your pricing at $1,850 or $1,900 with the willingness to negotiate less, you may be unintentionally missing out on potential renters.

Additionally, it may not add value to your listing to market your price ending in a $50 increment, like $1,850, since most search criteria increases in $100 increments. The $50 increment puts you in limbo with the inability to take advantage of viewers who are the next tier down. Take the plunge and lower another $50, it will pay off with a faster turnaround.

Rent Is Based On Desire

The desirability of your property will play a huge role in how much rent you can charge. If your property has very little amenities or upgrades or is in need of a lot of work, renters will not be willing to pay top dollar. The more attractive your property is, the more you will likely be able to charge. The following are some of the most sought-after features in Chicago, which should be taken into consideration:

  • Vista – What will your tenants see when they draw their curtains in the morning? A view of Lake Michigan or a park is more desirable than a view of a the exterior of the building next door.
  • Altitude – If your apartment is in a high-rise building, the higher levels are more desirable. Ground floor or garden apartments can be less desirable to some renters, due to security concerns and the possibility of flooding in heavy rains.
  • Area – Value increases with square footage. In most cases, the greater area your property has the more desirable it is. There is one caveat though: how well your space is used plays a major role.
  • Beds/Baths – Value increases in any market as bedrooms and bathrooms increase.
  • Storage – From closet space to a basement or storage locker to a garage, any and all extra space is a bonus and should increase desire.
  • Updates/Upgrades  – The more modern your property is, the better. Homes with modern, updated appliances are far more desirable than those with outdated features and finishes. Even ‘vintage’ can get old

The Right Price Is Attractive

If your property has been listed for a 2-3 weeks but you are not flooded with viewing requests, the price is likely a turn-off. Whether it is too high or too low, your audience will make assumptions. If a potential tenant thinks you are under-charging based on market demand, they may believe there is something wrong with the property.

You may find that using interest to find the “Goldilocks”, or perfect price point for your property is a solid tactic. Ideally, in the first couple of weeks that your property is new to the market you should receive 10-20 inquiries. And inquiries lead to showings!

Ideally, most landlords also want to make a profit. On average, a landlord pockets anywhere from zero to seven percent of the monthly rental income as profit. If the property is not benefiting you in some way, you might have set the rent too low, or worse, you might have over invested. Regardless of your goals, the right rent should, at the very minimum, cover all your expenses on the property. These include mortgage repayments (if you have one) as well as maintenance and repairs. If the value of your rental property does not meet or exceed this criteria, it may be time to consult an experienced, professional Leasing and/or Property Management service like Lofty to help get your investment back on the right track.

 

Speak with one of our experts to find out how we can supercharge your investment.

 

 

7 Security Tips for Property Owners

By | Property Management

Here at Lofty, we understand that life can sometimes be tough for a landlord or property manager. You have to deal with a lot of issues that many people simply do not want to deal with. However, promoting a safe and secure living environment in your buildings does not have to be complicated. Here are some basic safety and security measures you can take to improve the safety of the home, units or complex for your tenants.

#7. Secure Entry

Door locks can vary widely in number and type from building to building. It might depend on the preference of the landlord and tenant. It may be important to discuss this together to come to some sort of agreement. The locks can be old fashioned and this may make the tenant feel less safe. Modern locks make the home more current and sometimes safer.

Lost keys do not have to be a scary situation. Partnering with a local, trusted locksmith will prove to be invaluable. They can offer fast, reliable services based on the needs of your properties. In the event of specialized key systems, additional deposits and fees included upfront will ensure you are not financially liable in the event of an accident or negligence.

#6. Secure Units

Though it may seem like common knowledge, urge tenants to lock their doors at night and when they are not home. Even if the building seems safe, they still need to lock their doors if they want to prevent an unwanted intruder. Regardless of the time the tenant has spent in the property, a locked door is a safe door.

Some tenants may be moving in with valuable belongings. As such, they may only be interested in buildings with security systems monitored by an off-site service. If a tenant is already occupying your space, and expresses an interest in having a home security system installed, consider footing the bill for installation in all units, as this can be an investment that may make your vacant units more marketable in the future.

#5. Safe Passage

Did you know that there are sometimes financial benefits to making your multi-unit property safer? Consult with you insurance adjuster to discover all the ways you may save money on your policy. Consider installing locks on exterior gates or fences around the property. Additionally, exterior lighting, especially in secluded, dark areas, can be a huge safety plus for your tenants. Proximity or motion sensors and a timer will ensure these lights are not wasting energy while contributing to the overall safety and security at your property.

Let’s face it: this is Chicago and the weather is always going to cause a problem for someone, somewhere in the city. If it rains and tenants are coming home at night, you might want to have no slip strips to prevent falling. The exterior lights can help here, too. Even inside the building, it helps to secure the stairs. If it is carpeting make sure it is secured with tackless strip, just as a professional would install it. This may help prevent accidents for which you could be liable.

#4. Private Eyes

Installing security cameras is another option for safety and security. From large apartment buildings where people might not know who is in and out of their building, to multi-unit walkups occupied by familiar faces, a prominently displayed security camera can be an effective deterrent for criminal activity. While some states have a one party consent rule for recording, Chicago is in Illinois, a two party consent state. That means you must obtain written consent from your tenants, and keep a record of it, before installing the recording equipment. If a security camera system is not in the budget, a decoy camera (that looks real but does not actually record) can also be a deterrent—at a fraction of the cost and without requiring the consent of your tenants.

#3. Fire Prevention

Fire safety is not a thing to be taken lightly in your properties. Placing a fire extinguisher in a glass case in common areas or hallways can not only raise the property value and aesthetic appeal of your building, it also makes it safer. Additionally, consider fire extinguisher storage in individual units as well.

Providing basic fire safety tips for tenants can also go a long way. Check out our complete review of fire safety tips.

#2. Communicate Together

It is important to maintain the professional relationship between landlord and tenant but also remain friendly and light whenever possible. Consistent behavior like this can help foster a trusting relationship that does not cause stress. Sometimes people’s livelihood, families, or pets are concerned. Landlords should be respectful of their tenant’s wishes and tenants should respect their landlord’s boundaries.

#1. Special Care

If the tenant is elderly, has a health problem, or has a pet, they may need special accommodations. The landlord may need to check on them sometimes even if it’s a friendly email or phone call.

When you have successfully curated a safer and more secure environment, share your safety tips with your tenants. Just knowing you took the time to put together safety tips on their behalf could help them feel comforted and secure in their new space. Also provide a safety tip overview before new tenants move in, along with their welcome package.

Here at Lofty, it is our hope that these measures help make everyone feel comforted and secure in your properties. The home should be a comforting place, a place one comes to at the end of their day to feel safe and secure.

However, we know that property management is not for everyone. In fact, we embrace that fact and are eager to help take the headaches of owning a property off of your plate if you find it is not for you. Talk to us today and find out how we can help you live the life you deserve.

Speak with one of our experts to find out how we can supercharge your investment.

 

5 Organization and Planning Tips for Property Managers

By | Property Management

As a successful property manager, it is your job to wear multiple hats while juggling tasks to ensure that your tenants are paying rent, the properties are maintained and leasing runs smoothly, all in an organized, efficient manner. This entails presenting the required information to the property owner in a timely fashion and also meeting the needs of the building’s residents so they are kept happy. Without organization, you might quickly find yourself overwhelmed and find it difficult to do your job effectively.

Whether it’s fielding phone calls, answering emails, meeting with clients, billing tasks or any number of your other responsibilities, to find success as a property manager you must stay organized. Understandably, not everyone is naturally inclined to being organized. If you happen to be one of the many busy property managers struggling to stay on top of all your responsibilities, here are some key management tips that all property managers should be familiar with to help you get organized and on track for success.

#5. Hand It Off

There are only so many hours in the day and, as much as we all like to think we are superhuman, the more responsibility we take on, the more it becomes obvious that we can’t always handle everything. Sometimes, to make your work much more manageable and easy to organize, it can be helpful to delegate some of your workload to others—in some cases, even outsource it offsite. Outsourcing a task can be especially beneficial if you are delegating to someone who has specific skills to be better at efficiently completing the task. By doing so, you will free yourself up to be able to focus on your most important tasks at hand.

#4. Keep Them Smiling

Another key to being successful in this and any service-based industry is communication. Prompt, professional, and efficient responses to all inquiries, especially complaints, are important to building trust with a client. If you are overwhelmed and unorganized, timely communication can become a challenge. So what do you do if a property owner or tenant is unhappy with an aspect of their home, maintenance request responses, or anything else in regards to your management services? You can reduce potential negative feedback by planning ahead—determine how you will handle unhappy clients so next time you are contacted regarding a challenging situation that needs a property manager’s attention, you will be prepared to respond accordingly and rectify the situation in a timely manner. Failure to remedy client complaints in a satisfactory manner can result in damaging online reviews and negative brand recognition.

#3. Think Fast

Professional property management would be a piece of cake if everything always went exactly as planned. However, we all know there will be challenging situations—bumps in the road both big and small—that will come up. Education is the key to being prepared to handle these situations as they arise. For example, what happens if a property floods? What about the recovery process following a fire? These are circumstances where you need to act quickly and without hesitation.

If you are really serious about being organized, you may choose to create a detailed set of instructions for specific contingent events. Having a complete, detailed plan in place that can be referred to immediately in the event of an accident or crisis can be the difference between a quick, timely resolution and a stressful, disorganized situation. To create your contingency plans, document in detail the steps to be taken should a property experience a flood, fire and other potential situations. It will be best to distribute this document to all employees, and archived online where anyone can find it fast.

#2. Clear The Clutter

This industry is abundant with paperwork—it’s just the nature of the beast. Abundance of  hard-copy reports and unfiled stacks of papers around the office can easily confuse the otherwise efficient functioning of any property management company. Not only can clutter affect productivity, but it may lead to mistakes that result in frustrated, dissatisfied property owners and tenants.

It simply takes a little more work to keep things organized. Stay on top of paperwork as it comes in. Making designated time within your day devoted to filing and organization can go a long way. Property management software may be another solution, and can help reduce the need for extensive paperwork as it allows for documents to be submitted electronically! This way you will always be able to find what you need, when you need it, and you’ll have a clean workspace to help you stay focused and look presentable. This can go a long way if clients come to visit and especially if you plan to grow your business!

#1. Feedback Loop

Like we mentioned in #4 above, communication is king in the professional property management industry. One of the fastest ways to feel underwater is finding yourself playing phone tag or crawling out of what seems like endless threads of e-mails. So before you find yourself in this trap, save yourself time, any potential frustration and even a valuable client, with a communications protocol that is an agreed upon, mutually beneficial, method of communication that includes an acceptable turnaround time, that makes sense with both you and the property owner. Obviously, to function efficiently, you can’t always be available 24/7 to the owner, but keeping communications moving forward and smoothly will keep you as a trusted and organized property manager.

Real property management can be chaotic if the proper steps are not taken. As a property manager, a goal should be to minimize and manage any complications and chaos associated with running one or more residential properties. The most effective way to be successful at doing so, is by planning ahead and developing strong organizational skills. The tips provided above can help you become better organized and remain focused whatever the situation you may encounter, so you can be the best property manager in the most efficient and productive way possible.

Speak with one of our experts to find out how we can supercharge your investment.

 

 

Lawndale Anthony Zammitt

Neighborhood Guide – Lawndale

By | Neighborhood Guides, Property Management

Welcome to the Lawndale Neighborhood! Sometimes referred to as Douglas Park (because of the close proximity to this awesome park—more info further down), Lawndale is a bustling neighborhood featuring tons of interest, new and old!

Chicago’s West Side neighborhood of Lawndale is full of history. Once a hub for Eastern European immigrants, the area eventually became a center for the Civil Rights Movement when Martin Luther King Jr. lived there in 1966 while campaigning against housing discrimination. Today, the neighborhood is home to many terrific restaurants, one of the best breweries in the city and one of the city’s biggest music festivals, Riot Fest.

FACTS

When you take a drive, ride or walk around the area, you will probably notice quite a few Greystone style homes. That would be because Lawndale has the greatest concentration of greystones in the city. Greystones are a style of home most commonly found in Chicago. As the name suggests, the buildings are typically grey in color and were most often built with quarried Bedford Limestone from South Central Indiana.

The former Sears headquarters planted in this neighborhood starting in 1906. The administration tower of the former headquarters (925 S. Homan Avenue) was listed as a Chicago Landmark on September 4, 2002. It was also listed on the National Register of Historic Places and as a National Historic Landmark in 1978.

This area is home to Cinespace Studios (2621 W. 15th Place) which is where all of the shows set in Chicago go to film when city streets are not available.

Some notable residents include:

Martin Luther King Jr.; Dinah Washington, “Queen of the Blues”; the rapper, Twista; NBA players, Kevin Garnett, Isiah Thomas, and Mickey Johnson; as well as NFL players Darryl Stingly and Marques Sullivan.

EATS

Crazy Bird Chicken
1138 S. California Avenue
Owner, Larry Tucker (N.N. Smokehouse) opened this  tiny, mostly takeout spot that focuses on fried chicken and sides in 2014. His wife makes the pound cake herself and on Fridays and Saturdays, Tucker gets back to his barbecue roots and smokes rib tips in his small smoker.

Dave’s Red Hots
3422 W. Roosevelt Road
Been in business since 1938 and it looks like nothing has changed in decades, there are flyers tacked to the wall and yellowing menus. The must have menu item in this diamond in the rough are Vienna Beef links (they’ve been inducted into the Vienna Beef Hall of Fame) with their hand cut fries.

Green Tomato Cafe
3750 W. Ogden Avenue
This lively cafe is attached to the Lawndale Christian Health Center and is a welcoming spot with people gathering together and some on their own tapping away on laptops. The food is simple but satisfying and they even have a Saturday pancake breakfast. Just want coffee? A full espresso bar is available and uses beans from Bridgeport Coffee.

Lagunitas Brewing Company & Chicago TapRoom
1843 S. Washtenaw Avenue
This is the largest craft brewery in the city. Housed in a group of warehouses near Douglas Park, the facility has quickly become a popular destination for tourists and beer aficionados. A solid bar food menu is the perfect pair to your pint.

Las Quecas
2500 S. Christiana Avenue
A quesadillera that only serves quesadillas! Located in the back of the La Catedral Cafe & Restaurant, they are known for their thick, fresh, homemade tortillas, made right in front of you!

The Original Maxwell Street
601 S. Sacramento Boulevard
A walk-up window, located right at the corner of Sacramento and Harrison, serves basics like a hot dog and burger, but the Polish is what this place is known for.

PARKS

Douglas Park
1401 S. Sacramento Drive
Named after Illinois Senator, Stephen A. Douglas, who famously lost the 1860 presidential election to Abraham Lincoln, Douglas Park is an expansive 218 acre, historic regional park. Features that you can use include 2 gymnasiums, an auditorium, computer lab, fitness center, a kitchen, grand ballroom, and meeting rooms. Outdoors, the park offers tennis courts, a game day football stadium, outdoor pool, water spray features, basketball courts, an artificial turf soccer field, a pavilion, baseball fields, and a small golf putting range. In collaboration with the Chicago Bulls Basketball organization the children’s computer learning lab serves the children of the community. In partnership, with Ravinia, the park is host to a series of summer concerts, Riot Fest and the annual Junta Hispana festival in July.

Homan Square Park
3559 W. Arthington Street
The recreation, health, family and education center at Homan Square Park is a Lawndale staple. This park is home to an Olympic-size swimming pool, basketball courts and lots of green space.

Independence Square
Intersection of Douglas and Independence Boulevards
Once a center of the Lawndale community, this public fountain (which has been dry for decades) celebrates the signing of the Declaration of Independence. Dedicated in 1902, the statue on top of the fountain depicts patriotic children waving a flag and holding fireworks.

TRANSPORTATION

The L
Easy access to the CTA Pink Line which services this area. Stations are located at Kedzie and Cermak, Central Park, Pulaski, and Kostner.

Proximity to Downtown
Obviously there is a bit of fluctuation depending on where exactly you live within the neighborhood, but Lawndale is approximately 6 miles from Chicago’s Downtown Loop. Driving (without traffic) would take about 13 minutes eastbound on I-290. If traveling via the CTA, allow approximately 45 minutes.

Surrounding Areas
Little Village, Pilsen and the Illinois Medical District are your closest neighbors. The awesome thing about the surrounding neighborhoods is that they offer up different atmospheres that are unique to them…and quite honestly, that’s what makes Chicago great.

Thinking about purchasing or renting property in Lawndale? Get in touch with our experts to learn more about this wonderful neighborhood.

 

where to invest in chicago

Becoming A Chicago Real Estate Investor

By | Real Estate Investment

To make buying decisions like a professional investor, it is a good idea to familiarize yourself and understand the terms and vocabulary used within this industry, as these will ultimately help you determine if a potential investment is a good one or not. Here at Lofty, we know how important it is to understand the terms as you grow your real estate knowledge and so we have compiled a list for you!

CAP Rate / Capitalization Rate

A common real estate investment term is Capitalization Rate (CAP Rate). Simply put, the CAP Rate looks at the potential return of the investment. The higher the percentage, the larger your return. So, a high CAP Rate is desirable. Real estate investors use CAP Rate similarly in which stock investors use the P/E Ratio (Price-Earnings Ratio). Both CAP Rate and P/E Ratios are formulas that allow for quick, basic calculations that help a potential investor quickly determine if a potential asset is priced at a desirable valuation. Typically, a CAP Rate of over 10% will look to be an attractive deal.

CCR / Conditions, Covenants and Restrictions
These are commitments written into leases and contracts where all parties involved agree to certain terms, which can included performing any actions or inactions regarding the property.

CCRs can occur in several situations and as an owner, CCRs can be written into a property’s purchase document. Also, your tenants, for example, could sign a lease in which they agree to specific certain conditions (i.e. no pets allowed, tenant maintains landscaping, etc).

DCR / Debt Coverage Ratio

A commonly used term by lenders in the underwriting process for loans regarding income-generating properties. DCR is calculated by dividing the NOI (Net Operating Income) by the total debt. An average ratio is 1.20 and higher.

Effective CAP Rate / Effective Capitalization Rate

The Effective CAP Rate, also known as, The “true” CAP Rate, requires more calculations to determine. Typically, if a CAP Rate looks too good to be true, it probably is. While the CAP Rate only uses gross rental income, the Effective CAP Rate takes a look at the whole picture, which is the Net Rental Income. The Net Rental Income (a.k.a. Net Operating Income) factors in all costs associated with the rental property, like HOA fees, insurance, property taxes, vacancies, etc. A key point about the Effective CAP Rate is that it omits both the principal and interest payments because it assumes the cost of the property is fully paid for.

GOI / Gross Operating Income

This is the actual income collected from the property, annually. Which also includes all sources of income, like any on-site laundry, parking, storage, etc., and takes into account any vacancies.

LTV / Loan-To-Value

If you are taking out a loan on your investment property, LTV is important. You can calculate this percentage by dividing the loan by the property’s value. For example, if the loan is $200,000 and the value of the property is $250,000, the LTV is 80%. The lower the LTV, the more equity you have in the property.

Net Cash Flow

For smart investing, any real estate property worth pursuing should generate a positive cash flow. Or at least have the potential to generate a positive cash flow. Specifically, the net income generated each month from the property must cover all monthly expenses.

In the real world, not all real estate properties create a positive cash flow. When you identify a potential investment property, it will be important to do your homework before committing to a deal so you do not find yourself in the red.

NOI / Net Operating Income

This is the income left over after paying all your monthly expenses. So, to calculate your investment’s NOI, subtract your expenses from your GOI. For example, if you take in $10,000 in rental income on a multi-unit building and spent $8,000 on maintenance, insurance, taxes, utilities, and property management fees, your NOI for the month is $2,000.

PITI / Principal, Interest, property Taxes, and Insurance

Basically this is the bottom line to calculate when considering purchasing an investment property with a loan. Typically PITI is calculated on a month-to-month basis and as an overall number.

The month-to-month calculation is the portion of PITI you have to pay each month to stay in good standing, while the overall number is what you could potentially spend on the property over the life of the loan. Both of these calculations will help give you a base in how much rent you should charge.

TCRR / Total Cash Return Rate

TCRR can be viewed as your yearly percentage yield. The TCRR formula accounts for any upfront costs while in the purchase process. TCRR is calculated as (net cash flow + principal payment) divided by the total cost due at signing (down payment), which does not typically include the closing costs. Whereas the CAP Rate assumes that full down payment is ready at the time of closing.

With the final goal of making money is easy for anyone to shoot for, it will be helpful in reaching that goal to learn how to calculate and communicate like a professional investor. When getting started with something new, there is always new terminology and acronyms to go along with it. It is no different when it comes to real estate investments. Taking time now, could be a big benefit for your future real estate portfolio.

If you are of the TL;DR segment of our audience, you may want to work with a trustworthy team of real estate professionals to help guide you down a path of investment success. Here at Lofty, we have the experience, expertise and care to help get you where you want to be and more! Talk to us today and see how we can help you live the life you deserve.

Speak with one of our experts to find out how we can help you build your dream portfolio.

landlord tenant relationships

4 Tips on Successful Chicago Landlord Tenant Relationships

By | Property Management

One of the most important components to being a successful landlord is forming solid business relationships with your tenants. A solid landlord/tenant relationship consists of both sides respecting one another and appreciating what each of you is bringing to the partnership.

The key is following through on your end of the relationship: a landlord who shows they respect and care for the tenants by being accountable and responsive to maintenance requests; tenants who pay on-time and continuously work towards leaving the property better than they found it. It is important to avoid letting a sense of entitlement seep into the relationship on either side as it can cause offense and crumble this relationship.

Getting off on the right foot with your tenants early on will set the pace of the relationship for the life of the lease. There are several benefits to being more than a faceless person that collects rent payments. Check out the video below and the full blog here: How To Effectively Begin A Landlord Tenant Relationship

If all else fails, and you find yourself unhappy to manage your rentals, please consider a property management company like Lofty. Here at Lofty, we take pride in managing the relationships and challenges that come with maintaining profitable investment properties. We offer a variety of services that can help you maintain low vacancy, high value and maximize profits while minimizing your actual time investment. Please reach out for a free consultation today!

Speak with one of our experts to find out how we can maximize your investment.

 

Purchase Chicago Properties Like A Professional Investor

How To Purchase Chicago Properties Like A Professional Investor

By | Real Estate Investment

Many people today want to add real estate to their portfolios and call themselves a real estate investor, but they do not necessarily understand the ins and outs of real estate investing or where to start the process. Some of those people probably perceive the industry as being too complex to participate. Real estate investing is much different from investing in the market of stocks, bonds, and CDs and can seem overwhelming to brand-new and rookie investors. With that in mind, below are 9 tips to help you successfully launch and navigate your budding career in real estate investment.

Investing Is Serious Business—Map your goals and make a plan

Your investment portfolio is your business and so it should be treated like a business. Developing a good business plan is a great start, detailing the operations of starting and also running your business. Set realistic goals over one, three, five and 10 year spans. If not sure where to start with creating a business plan, there are many good examples to be found online with a quick search. If you are unfamiliar with business plans in general, it may be best to do your research before getting started.

Know Your Worth—Start out with your eyes and ears open

Determining your credit score will bring your financial situation into the light of day. This will be important to determine your ability to finance an investment property, so you do not get blind-sided by any surprises that might inhibit your purchasing. Careful as to not repeat the lending market bust in 2008, lenders today are looking for credit with a 700 or better score from investors who want to buy investment property. Unless, you plan to purchase in cash, of course—cash is king and your credit score is not relevant. Keep in mind, when going the lender financing route, it will be helpful to make sure that your total monthly debt-to-income ratio is on the low side. In order to improve debt-to-income ratios, pay down car loans, outstanding credit card debt, and reduce overall credit spending.

Invest In Education—Your brain is your most valuable asset so invest in it, too

High-level employees at any successful corporations are sent to numerous educational seminars, trainings, conferences and more, so they can stay knowledgeable and sharp in our ever-changing world. It makes sense that their superiors would encourage this behavior as it makes them a greater asset to the company. Think of your brain as your human capital, your top-performing employee, and strongest asset—invest in it. You can find loads of information on real estate investing online for free. If you do purchase a book, look for one that offers practical guides on buying, renting, flipping and selling properties. It would be best to avoid books that claim “get rich quick” or books that are 25+ years old explaining techniques that may no longer work, as market fluctuations and trends have both changed drastically over the decades. Beware to keep your research comprehensive early on, until you get the lay of the land, so to speak. Misinformation can be remembered just as easily and can be just as hard to forget.

Leverage Your Network—Seek out those who have had success and stay in touch

Putting yourself in the best position to succeed is one aspect of purchasing property for sale like an investor. To do so, model your investing decisions after what other successful real estate investors in your area have done. Seek out opportunities to learn from the best. If you don’t know the best, find them. One place to find other investors is a real estate club in your area—a quick online search should help. These clubs are great places to network with other investors, lenders, repair service providers and others apart of the real estate industry. Many times you can expect to pick up helpful advice about your local market from other attendees and even other investment opportunities.

Another place to network is to see if your community offers courses on real estate investments through local real estate brokerages. If you are having difficulty finding a real estate network or course in your area, consider checking out an online investing forum. Finally, Chambers of Commerce can be excellent for finding the movers and shakers in a very local area. There may be a fee to join, but adding the right person to your network quickly becomes invaluable.

Know Where You Want To Be—Educated research and digging can uncover diamonds in the rough

Rookie investors can easily make the mistake of limiting their property for sale search close to where they live. However, better rental areas might be located a little further away. New investors may think it’s necessary to live close to their properties in case tenants call about repairs or other issues. However, with proper preparation, the home will be in good shape before your tenants move in, and those repair calls from tenants should be few early on.

Professional Experience—Find an investment expert

Although the education is out there so anyone can learn to become successful real estate investors, not all Realtors are experienced, savvy and confident when it comes to helping investors get started or even to keep moving. To ensure you are partnering with someone who understands the real estate investment industry, make sure the chosen Realtor has a recent history of sold investment properties (the more, the merrier), like foreclosures, and also understands concepts such as debt service, return on investment (ROI), and net operating income (NOI). These are the kind of Realtors that will be understanding and mindful of your goals, and may even help you to adjust your path to reach them more quickly!

Bank Or Broker—Find someone reputable and knowledgeable

If you are planning to finance capital for your investments, Realtors may be able to introduce you to someone—or you can ask other investors for their expert recommendations. Even if you have to start cold, this is a search that might be beneficial prior to your future portfolio. If you are planning to pay upfront with cash, keep in mind, you will need to prove the liquidity of the funds, and that they are in your possession by submitting a recent bank or brokerage statement when you make an offer. Experienced mortgage brokers and bankers are invaluable partners to make and keep.

Look All Around—Make a list of all possible listing resources and keep up with them

New investors might think it is only possible to purchase homes through the widely known Multiple Listing Service (MLS), or even by knocking on doors in neighborhoods with For Sale signs. Consider your next investment opportunity property might be found on other various sites, like Auction.com or Craigslist.com. It is possible you might be able to find much better deals on these sites, and sometimes easier for buyers to make purchases outside their local area. Casting a wide, wide net will always work out in your favor if you stay diligent, vigilant and organized.

How Does It Measure Up—Identify the rate of return to determine a good deal

An old rule of thumb in real estate that still rings true today says that if a rental investment property yields one percent of the sales price per month, it is a good deal. Utilize an investment property calculator for number crunching prior to buying property. For example, if the purchase price of the investment property is $100,000, you should expect $1,000 per month in rent, or about 12 percent annually. However, in some areas of the US today, where home values have declined, investors might be able to net returns greater than one percent per month.

As you can see from the tips listed above, real estate investing does not have to be difficult or intimidating. The best philosophy behind how to invest in real estate is to maximize return while minimizing risks. When investing is done correctly, real estate is one of the safest and best long-term wealth-building tools available. As with anything that is worth your time and energy, the harder you work towards and the amount of effort you put into your real estate investment business, the greater your ultimate reward will become over time.

However, you may still not want to go it alone. That’s pretty smart of you, because here at Lofty, we feel pretty good about our ability to grow your investment portfolio for you. Whether you want a consultant to guide your decision-making and assist your education, or someone to work in your interests while you spend your time in other ways, Lofty wants to see you succeed and we have the means necessary. Talk to us today and see how we can help you to live the life you deserve.

Speak with one of our experts to find out how we can supercharge your investment strategy.

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