Chicago Real Estate: Renting
If you’ve just moved to Chicago and you’ve decided to rent then you’re likely in the majority. Poor saps enslaved to their mortgage will try to shame you into thinking you’re wasting your money. Maybe you are, but life is short and I wouldn’t recommend buying your home to anyone in Chicago until they are almost a pro on the different neighborhoods. You can live your entire life in Chicago and not pass through every intersection. This city has endless possibilities and the hood that looks hip and convenient now might seem boring and overcrowded in a year. Besides, people these days don’t know what the market will do to the value of their homes and sometimes throwing away a little money now will keep you from losing a lot of money down the road.
Figuring out what neighborhood you want to live in is the fun part. Finding a place that works for you is what sucks. Unlike the MLS for real estate sales, there’s no omnipotent resource for every rental listing in Chicago. Craigslist comes close, but if you hunted down every rental lead on the site you’d be one tired puppy. The Chicago Reader was a major source of rentals for many people before Craiglist and still offers some good finds. Even the MLS offers more and more rentals in this down economy, and sales agents who wouldn’t touch a rental five years ago are happy to take you out now.
The problem with MLS rentals is that they tend to be exclusively higher-end properties and recently purchased condominiums. Since real estate agents get paid the equivalent of one month’s rent from the landlord, they’d often prefer not to kill themselves for a low price rental. This is where “leasing agents” come into the picture.
If you found a Chicago rental service on the Internet then you’ve likely found yourself a Real Estate broker with leasing agents. These services are usually hired by the landlord to market their place for them, paying a fee equivalent to one month’s rent. Some young buck willing to work for small commissions (percentage cuts on that fee) will take you out to see the place you inquired about along with whatever else they’re trying to move that month. The key thing to remember here is they can only show you what their company has in stock, not the full offerings of the market. If it’s one of the bigger companies then that can be a lot, but it’s good to keep perspective.
If a company is charging the renter a fee then they better be showing you some amazing apartments at great deals. This is rare but not unheard of. Just take the fee they are charging you and divide it up by the 12 months of your lease agreement. Add that to your rent for the true cost of renting.
Make sure you factor in what utilities and building assets are included or not included when determining your rent. When I have a buyer looking at condominiums I try to steer away from those big old high rises along the lake front because of how expensive their monthly assessments are. Once you add in the cost of doormen, swimming pools, party rooms, full attendant parking and the high cost of poor efficiency buildings into the mortgage then you’re often screwed. For renters on the other hand, these buildings can be great finds assuming your rent isn’t too high. The adage “you get what you pay for” doesn’t always apply to the rental market so try to keep the big picture in the perspective.
This philosophy definitely applies to your lease agreement too, so read the fine print. If the landlord requires a deposit to cover any possible damages, you can usually kiss that money goodbye. That’s not to say the money is poorly spent, most renters don’t exactly keep their homes in tip-top shape. But it comes down to your agreement, both written and unspoken. Some landlords will charge top dollar but are out there in the middle of a snow blizzard shoveling your walkway. Some landlords will only come out for major issues but the price is right so the renter doesn’t dare speak up anyway. If you really feel you were a fantastic tenant and that deposit is owed back to you then just stiff the landlord on your final month’s rent (assuming you’re moving out). It’s not the ideal way to handle business, but the laws of Chicago almost always side with the renter.
The rules of renting in Chicago aren’t very different from anywhere else, but it’s still helpful to know what you’re doing rather then sticking your finger into a newspaper and letting fate decide. If you need any tips or neighborhood advice feel free to email us. But please, we aren’t accepting roommates.