BUYING SHORT-TERM RENTAL PROPERTY IN CHICAGO

The short-term rental property investment market is hot in Chicago.

As the name suggests, short term rentals shave shorter than the standard one-year leases, so they're often used as stopgaps for tenants not looking to make long-term commitments. Expect one to six-month leases or even shorter ones for specific month-to-month apartments.

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Why are People Investing in Short-Term Rentals?

Buying short term rentals are a great way to diversify the investment portfolio while helping you streamline financial safety during these unprecedented times. From the steady rental income stream to the lucrative tax benefits you may qualify for, there are various benefits of investing in a rental property if you choose the perfect location.

The abundance of restaurants, art galleries, theaters, beaches, parks, and many other popular tourist and local places has made real estate investments in Chicago lucrative.

But, if you still need to diversify your portfolio and plan on buying short-term rental property in Chicago, here's all you need to know before starting.

Facts About The "Short term Rental Market in Chicago"?

Situated in Illinois, the windy city of Chicago is known for its sporting activities. However, its growing employment opportunities, economic boom, cultural, music, and film festivals, and several other attributes attract millions of tourists annually. This made both renters and buyers interested in investing and taking advantage of the vibrant real estate sector.

Investing in real estate in a quality neighborhood is a wise decision, especially in Chicago. Therefore, the city and its surrounding suburbs receive ample attention from renters and investors for carrying far-reaching potential and helping their long-term wealth and passive income grow.

Contrary to popular belief, the states are relatively affordable to invest in compared to other big cities in the United States. Therefore, Chicago's short term rental market presents an incredible opportunity for investors looking for long-term returns on their real estate investment.

Evaluating Short-Term Rental Properties in Chicago

The number of short term rentals in Chicago's projected to grow by 17% this year, with over 1.4 million listings. Research also reveals that 28% of second homes are predicted to be used as part-time vacation rentals. The rising trend is pointing toward-astronomical growth in the industry.

However, buying the right short term rental property in a high-demand neighborhood can make the difference between a profitable investment and barely breaking even. On average, investing in attractive markets means generating enough revenue to cover the mortgage payment in less than fourteen days.

Operating expenses, seasonality, amenities, occupancy rate, supply and demand, net operating income, average daily revenue, proximity to desirable amenities, cap rate, and other factors impact the STR's potential profitability. The key is to research thoroughly before making the purchase. If you're in it to win it, let's look at a few steps when investing in real estate in Chicago.

Curate a Fool-Proof Business Plan

Before starting the search phase, create a business plan covering details about where you stand today, where you see yourself in the future, and achievable yet specific steps you plan to take to reach those goals effectively. For instance, determine whether your goal is to purchase the short term rental (STR) to generate extra rental income now or diversify the portfolio for retirement purposes.

Determine a Budget

When investing in real estate, it's essential to determine what you can afford. Planning can help avoid overspending or getting into unnecessary debt. Having all the relevant information on real estate taxes, high-demand locations in quality neighborhoods and property prices will help you pick the best property within your budget.

Research the Market

Owning a short term rental is much like being in the hospitality business. Consider the demographics you're targeting, and other factors hotel operators consider when researching markets. Consider factors like occupancy projections, seasonality, demand trends, proximity to tourist attractions and business hubs, number of STRs in the local market, amenities, and regulations that may impact your property.

Run the Numbers

After getting a fair idea of the potential income, you can look forward to crunching the numbers and forecasting expenses to determine whether the property is likely profitable as a short term rental. Factor in expenses like insurance and taxes, property management services, repairs and maintenance, and the monthly mortgage for financed properties.

You'll also need to consider expenses unique to owning short term rentals, such as more frequent maintenance and cleaning due to higher guest turnover, stocking the STR with supplies and linens, furnishing upgrades, and fees paid to online booking platforms.

Make an Offer

Suppose you're tired of spending hours sorting through global listings or the MLS, Inter Properties, Inc can help.

We offer an exclusive inventory with top negotiation experts who can navigate the process in different languages and cultures. We can link you with reliable agents to help ensure the contract terms are in favor and everything is per the laws.

The process of investing in short-term rentals is similar to that of purchasing other real estate properties in Chicago. But you don't need to worry about the nitty-gritty when our top agents are by your side.

Team Up with the Professionals

Managing a short term rental requires a customer-focused approach. For example, suppose you're a global investor or don't have time to manage the concierge services. In that case, it's recommended to streamline the services of a property management company to make sure the property remains in good shape for each guest. Partner with us to make finding, buying, and operating a profitable STR property in Chicago much easier.

Our professionals will handle all aspects, including guest departures and arrivals, maintenance, cleaning, repair, and overall care. Given the rising crime rate in Chicago, working with the right real estate investment company can help secure your investment from vandalism, burglary, and theft.

So contact us to increase your chances of achieving financial success and building future wealth as a short-term rental property owner.

Please give us a call or email us to schedule a consultation.

We can facilitate managing, buying, and selling corporate housing rentals, short-term rental investments, single plus multifamily real estate, luxury vacation rentals, and commercial real estate management for individuals, families, landlords, and vacationers across Florida, Chicago, and Coast Rica.