Monthly Archives: November 2012

Holiday Gifts for the New Landlord

Do you have a new landlord in your life? Is there someone you know who recently made the plunge into investment property? Or maybe you did, and you’re looking to drop some subtle hints to your loved ones about your holiday wish list? Here are some ideas for gifts both large and small that any starting landlord would probably welcome.

General note – these are suggestions for friends and family of landlords. If you’re a tenant, it’s probably best to just stick with giving your landlord a nice greeting card. Maybe a fruit basket.

Top Shelf

Key Cutting Machine. A decent DIY key cutting machine plus a box of blank keys will run anywhere from $400-1300. However, if you figure that every time an apartment turns over you’re spending $10 plus gas money to copy key sets, not to mention keys for contractors, Realtors and maintenance staff, you’re looking at an investment that could pay for itself within 3 years for a 6-flat apartment building full of two-bedroom apartments.

Paint Sprayer. These run $100-250 for a basic unit to handle interior jobs, although Cadillac models can obviously be far more expensive. This is another one that will pay for itself rapidly. The first time you (or your landlord friend) don’t have to throw your back out roller-painting an apartment – or spend a full day painting – you will be so very grateful.

Salt Spreader. Any landlord worth his salt (pun intended) will own a snow blower in Chicago, but few will splurge on a salt spreader. It’s a worthwhile investment. Even though they run $200-600, it’s a one time purchase that will last for years if treated correctly. A preventative salting of the walks can save a lot of angry phone calls, not to mention personal injury lawsuits. This is another one that may save you a thrown out back, this time from shoveling heavy, iced-over snow. And really, would you rather stop by the evening before a storm to salt nice, dry, clean walks, or go out at 4am to break up ice the morning after?

All three of these top shelf items are available at your local hardware store. I’m not going to link to Amazon here – this is a nice big purchase that you can bring to a family-owned, mom & pop shop. Support your local business!

Show some love for the Crafty Beaver this holiday season.Hey, I almost typed that whole caption without giggling! Go me!

Medium Cost

Professional-Grade Drain Auger/Snake. These run $30 to $150 at a hardware store. Tenants don’t pay very close attention to what’s going down the drain. It’s inevitable that you’ll be called out to rod out the drains of accumulated gunk at least once a year. If the tenant has long hair or super fluffy pets that frequency goes up exponentially. Rodding out the drain yourself is far kinder than chemical agents like “Liquid Plumr,” and definitely more cost effective than calling a plumber every time. Avoid the cheap plastic versions – this is something you definitely don’t want going pear-shaped on you in the heat of the moment. Read the reviews and get something sturdy.

Landlord Locks. These are a specialty item found only at landlordlocks.com. They run about $25-42 each for the locks, $10-12 for replacement cylinders, $3 for a backup master. That’s about twice the cost of a standard deadbolt, but they make it up in cost per use, as they’re completely reusable. They’re designed so that you can pop out the tumbler and swap it for a replacement using a master key. Chicago now mandates that locks be changed between tenants. A system like this will allow the landlord to easily swap cylinders without drilling or damaging the door.

Label Printer. It’s amazing how many times you need to label stuff when you own an apartment building. Mailboxes. Buzzers. Circuit Breakers. Laundry Machines. Tools. Keys. A label maker is the kind of gift you never realize you needed until you have one. $25-40 at any office supply store.

I recommend you get a spare roll of label tape. The first day of owning a label printer may involve cutting labels off of dog after a downward spiral into printy, sticky compulsion.

Workplace Spanish for Real Estate. This has a considerable amount of language for landlords and leasing agents as well. The book is available used on Amazon for an exorbitant amount, but you can pick up a copy of the book & CD new from Workplace Spanish for about $30.

Stocking Stuffers

Dust masks. These are $10-20 for a multi-pack. The number of times you need these when working with investment property is astronomically high. Walking through damp basements. Scraping and painting apartments. Sanding down floors. Replacing moldy drywall. Not glamorous at all, but definitely useful and a way to show that you care.

Keychains. Prices vary for these. You can go all out crazy and get a logo printed on them, you can get a box of disposable cardboard keytags, or you can assemble a personalized collection of them in a variety of sizes and styles. They will be used. Oh yes they will.

Sonic Measuring Tool. This is my personal favorite. at $16-30 each plus the cost of a battery, I have one in every purse. Set the butt of it against one wall and it will bounce a sonic wave off of the opposite wall. I can take measurements of an entire apartment alone in about 5 minutes with mine. Most will automatically calculate square footage and volume, making them useful for contractors as well.

The sonic measuring tool is not to be confused with a sonic screwdriver.

Light Bulbs. It’s a curse of living in the modern, eco-friendly age that tenants now tend to take their expensive CFL light bulbs with them when they move out. A pack of soft white CFLs may not be romantic but it will definitely be appreciated.

Not Recommended

Credit Card Processor for the Cell Phone. You might think it would make life easier for the landlord to be able to collect rent via credit card. However, the processing companies take a percentage of the payment, and there are online rent payment companies that handle that kind of thing for far less. It really should be a matter of the landlord’s personal choice if he/she wants to spend that kind of money on processing fees.

Property Management Software. This is another one that really requires the input of the individual landlord and a lot of testing. Everyone has a different level of comfort when it comes to accounting and data entry.

Landlord Books. Unless you’re a landlord yourself with a lot of experience reading how-to manuals, I don’t recommend purchasing them for other landlords in your life. It’s very tough for someone outside the industry to figure out which books are telling the truth and which are completely useless, especially with the wide variety of regionally-specific laws. You don’t want your gift to be the reason why your buddy winds up getting sued by a tenant. Besides, the risk of accidentally insulting your friend is pretty high if you give him “The Complete Idiot’s Guide to Being a Landlord.” Get a bookstore gift certificate if you must give literature.


Due to the high potential for spam on this article I’ve preemptively disable comments. If you would like to add a suggestion to this list, please use the general blog’s contact form. I’ll be back on Monday with a companion list of gifts for the renters in your life.

Magic Words

Humans have a strange habit. They attempt to avoid the negative effects of powers that they do not understand by using words and symbols that they also do not understand.

Some are fictional.

 

Others are harmless gestures.

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Could Your Property Pass a Section 8 Inspection?

If you’re involved in the rental business it won’t be long before you hear about Section 8. Chances are good that you’ve heard of it even if you aren’t involved with renting. It’s bandied about by NIMBY residents who don’t want poor people living in their neighborhood. You see, “Section 8” refers to a portion of the US Housing Act of 1937, which authorized the government to pay rent on behalf of residents who would not otherwise be able to afford it. While it generally is used by low income residents, it’s also used in some occasions to assist people who have lost their homes to natural disasters, as was the case after Hurricane Katrina.

In Chicago it’s administered by the Chicago Housing Authority and utilizes two main types of homes: those owned and managed by CHA, and privately owned apartment buildings throughout the city.

… Not that Section 8

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Chicago Renters and Owners: A Snapshot

I’ll be off on Friday for the Thanksgiving Holiday, so I thought today we’d do a chart-based photo essay. As I promised at the end of Monday’s article counting Chicago apartments, I went back into the American Housing Survey from 2009 and dug up some more results. There’s a little something for everyone in the following charts and graphs. Take home a few select morsels to argue with Uncle Bob about at the dinner table.

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Counting Chicago Apartments

In the near future I’m going to have need of a reasonably accurate count for the total number of rental units in Chicago. I had pulled a quick figure from the National Multi-Housing Council earlier this year that was around 550,000, but when I went back to check the updated numbers this week the count had fallen to 288,000. That didn’t seem right to me.

Finding a Legitimate Data Source

It turns out that there’s a wide variety of sources you can use to count rental units, and the total count depends on how you slice & dice the city. Do you count vacant units? How about condos for rent? Do you count units that the city doesn’t consider to be legal, like some garden apartments? Do you consider just the city of Chicago, or expand it to include all of Chicagoland? In the process of researching this article I considered a number of different sources, including government agencies like HUD and the census bureau and private industry sources like the National Apartment Association and the National Multi-Housing Council. I ruled out the private sources early on, as they tend to hide their data behind hefty paywalls and remove historical data from public view.

That left HUD and the Census Bureau, departments that tend to work together to come up with Housing surveys. They do three of note – the American Housing Survey, the Housing Vacancies Survey, and the American Community Survey. All three address the Greater Chicago Metropolitan region, but that extends all the way down to Joliet. I wanted numbers for just Chicago. After reviewing all of the data, I settled on the American Housing Survey as my source for numbers. It has Chicago-specific data, a new report is generated every two to four years, and historical data is available online for free going back to 1975. It isn’t the best – the most recent data is from 2009 – but it’s specific and detailed.

The Numbers, Sliced & Diced

2009 was the bottom of the most recent slow rental market. Vacancy rates for that period in Chicago were between 9 and 15%, depending on which source you use. Currently vacancy rates are far lower, more like 4.5%, and predicted to dip down to below 4% next year. It is my hope that in the next 12 months we’ll see an updated survey that reflects the recent fast market.

Total Occupied Vacant True Vacancy Rate
2009 American Housing Survey
     Chicago Rental Units 551,400 472,400 79,000 14.3%
     Breakdown Total % of Total
          In 2-4 unit buildings 197,800 41.9%
          In 50+ unit buildings 107,500 22.7%
          In 5-50 unit buildings 93,200 19.7%
          In Condos & Coops 41,100 8.7%
          In Single Family Homes 32,800 6.9%
          With new tenants in the past year 144,400 30.6% Turnover
     Tenants 1.033,800 (2.2 tenants per apartment)

Before we proceed, let’s discuss the true vacancy rate as compared with the reported vacancy rate. The AHS survey counts every unit, regardless of if it’s rent ready or not. A large number of units could be sitting vacant but not in good enough condition to be occupied by anyone. Therefore, in 2009 you’ll see that the True Vacancy rate was around 14%, while the pundits reported the rate to be closer to 9.1%.

This discrepancy is one of the reasons why I focused on the census results as opposed to any commercial entity. The Census Bureau, tied to HUD, has not reason to rule out any building. Their numbers will consider all portions of the rental market, regardless of habitability, ownership or sale value.

Of course, a one year sample wouldn’t suffice. Statistics always are more useful with comparison points. So I went back and pulled the same statistics from 10 years earlier, in 1999. I did this as a general point of comparison, but it’s also worthwhile to note that 1999 was a similar market to our current situation – reported vacancy rates were at a very low 4.2%, with actual vacancy rates per the census bureau hovering around 10%.

  Total Occupied Vacant True Vacancy Rate
1999 American Housing Survey
     Chicago Rental Units 589,967 529,200 60,767 10.3%
     Breakdown Total % of Total    
          In 2-4 unit buildings 232,700 44.0%    
          In 50+ unit buildings 92,400 17.5%    
          In 5-50 unit buildings 155,800 29.4%    
          In Condos & Coops 28,600 5.4%    
          In Single Family Homes 19,700 3.7%    
          With new tenants in the past year 144,900 27.3% Turnover    
     Tenants 1,271,200 (2.4 tenants per apartment)    

So Chicago lost about 30,000 rental units over the decade between 1999 and 2009. That makes sense, as many of those units were converted to condos. You’ll note the shift in the breakdown of apartments – the mid-size buildings with between five and fifty units bore the brunt of the conversion craze, and saw a drop in rental population accordingly. Now, compare the numbers for rented single family homes and condos. Back in the late 1990’s very few renters were utilizing these units. Ten years later after the collapse of the housing sales market both sectors saw 30-40% growth among the rental population, reflecting the tendency of underwater sellers to turn landlord for a while.

Overall though, it looks like our answer for the total inventory of rental housing in Chicago is somewhere between 550,000 and 600,000 units, with actual vacancy rates consistently about 5% higher than the reported vacancy rates due to the burying of illegal or otherwise unlivable spaces. Each apartment houses an average of 2.3 people, and in a typical year the city turns over about 27-30% of its apartments. This is considerably below the National Apartment Association’s stated national average of between 42 and 54% annual turnover for market rate unit, but within range of their 19-33% natioanl average turnover rate for subsidized housing.

The AHS analyzes a lot of other great bits of data which I’ll delve into on Wednesday. Let me know in comments if there’s something you want me to dig up. See you then!

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Pig Latin: Confusing Chicago Regional Real Estate Terms

We Real Estate folk talk pretty funny sometimes. Here’s some terms that are often confused, even by supposed “professionals.” Today I’m going to be discussing how they should be used within the Chicago regional real estate market. I’ll also give some warnings as to how the terms are misused by certain real estate practitioners who don’t know their stuff.

Deposit vs Fee. A deposit is basically collateral. It’s held for a specified time period and returned to you if you behave yourself. A fee, on the other hand, is never refunded. I have unfortunately seen terms such as “non-refundable deposit” get tossed around, which is just outright incorrect.

Deposit vs. Down Payment. For first time renters, it’s easy to get these two terms confused. For rentals you put down a security deposit. For new home purchases you put in a down payment. I’ve heard many prospective renters ask me how much of a down payment is required by the landlord. While it’s pretty easy for me to translate in my head, those renters immediately give away their lack of experience in the market.

Eaves, Fascia, Soffits, Gutters and Downspouts. The eaves are the part of a roof that stick out from the side of the building. The roof will have a certain amount of thickness to it, meaning that it doesn’t meet up with the wall in a perfect point. The fascia spans the gap between the roof and the wall like a bandage. If your roof protrudes substantially from the side of your house, you will have a soffit underneath the overhang. This is another “bandage” to cover the gap underneath the roof. A gutter is a semicircular tube that runs along the point of an eave furthest from the building where the roof and the fascia meet. Water collects in the gutters and runs through them to a central drainage point. Connected to that drainage point is a downspout, a vertical tube that runs down the side of the building.

From renovationexperts.com. You’re welcome.

Scavenger. When you’re looking at a real estate listing in Chicago, “Scavenger” is the term used to refer to trash collection. As a general rule of thumb you will not have to pay for trash pickup if you’re renting in Chicago. If you’re a homeowner in a building with fewer than seven units the city will provide pickup, covered by taxpayer funds. If you’re owning in a larger building your trash collection will be outsourced to a third-party hauler. The cost will be included in your assessments. Some new Chicagoans will interpret “scavenger” to mean pest control. Don’t confuse the two terms.

School District vs. School Attendance Boundary. The entirety of the Chicago public school system is referred to in state terms as “District #299.” You heard right. Every public school student in Chicago is in the same district. However, some of the schools have geographic attendance boundaries. If you live within those boundaries, your children will be expected to attend the designated neighborhood school. However, in many cases you can opt to send your child to a different nearby school, a magnet, or a charter.

Ceci n'est pas un ranch.

It’s a penthouse! It’s a garden unit! It’s all of the above!

Penthouse. In television lingo a “penthouse” refers to a single unit protruding from the roof of a skyscraper. They’re usually large and luxurious, and possibly the only unit on that particular level. Chicago uses the term more generically. A penthouse in Chicago real estate refers to any top floor property in a multi-unit building.

Rehab vs. Renovation. There was a time when “rehabbing” a property meant a whole-hog, full-on repurposing of a failing structure. Rooms were moved around, entire sections of wall were replaced. Renovation, on the other hand, took a property in decent but dated condition and freshened it up with new finishes and modern amenities. The two terms are now used interchangeably. If you see that a property was “recently rehabbed” it could mean something as basic as replacing the carpet in a couple of rooms.

We’ll call it the Amy Wine House.(Too soon?)

Dining Room. I’ve discussed my issues with counting rooms before, so I won’t dwell on this. It will suffice to say that with “combo” dining rooms a viable option in real estate listings, all a “dining room” signifies is that a real estate agent thinks you’ll be able to fit a 6 person table in some corner of another room.

Deck vs. Porch. In Chicago, those wooden (sometimes metal) structures attached to the back of buildings as fire escapes are called porches. If it’s attached and stacked in multiple levels up the back of a building, it’s a porch. If it’s freestanding and uncovered, it’s a deck.

Any Questions?

Township. When you’re looking at a Chicago real estate listing you’ll see mention of a “township.” Many home seekers get confused and think that this refers to the neighborhood of the property. Chicago only has eight townships. They’re relics from the old days before Chicago was quite so large, and basically delineate the different towns that Chicago swallowed as it grew. There are eight townships: Rogers Park, Jefferson, Lake View, North, West, Lake, South and Hyde Park.
These days township boundaries are only used by Cook County for dividing up property tax appeal deadlines. So, if you’re looking in Edgewater don’t be surprised to see that your property is listed in Rogers Park Township.


Do you have any terms that confuse you from the Chicago housing market? Let me know and I’ll try to cover them in another installment of Pig Latin.

The Online Rental Scams and How to Avoid Them

Would you marry this person? No? Then why would you rent from a landlord if you couldn’t meet him nor see the apartment first?

Here’s a fable for you. You’re hunting for an apartment online. You have a budget that’s towards the lower end and are tired of looking in the bad neighborhoods, so you take a quick look over into a trendy, name brand area. Suddenly you spot it! A three bedroom house for rent for just $800, when all of the other listings are $2000! And it’s empty and move-in ready. The address is even in the listing so you’re pretty sure it’s legit.

You contact the landlord. They say they’re out of the country working with the Peace Corps in Africa, so they can’t meet you in person. However, they suggest that you go drive past and take a peek in the windows if you like. You might do so. Or maybe you think, “gosh, this landlord is so clueless keeping the rent so low! I should jump on this before he figures out what the real value of his listing is.” (more…)

10 Things that Renters and Home Buyers Forget to Check

“Do you have any questions?”

I always ask this at the end of a showing. It’s really an unfortunate question, don’t you think? Unless you’ve prepared well and assembled a list, it’s easy to forget a few of the big questions when you’re in the middle of a showing. Here’s a few you can take with you next time. They may help you to avoid some major annoyances. Some you can answer on your own, while others will require feedback from the listing agent or landlord.

1. Do the doors close securely?

Look at the outside doors. Do they have deadbolts and doorknob locks? Are there privacy chains or latches on the inside? Is there a peephole or some other way to see who’s outside without opening the door? Is it possible to accidentally lock yourself outside on the porch? Now look at the interior doors. Can you close the bedroom door securely? The bathroom doors? Is it possible to accidentally lock yourself into or out of a room? What about the kitchen? If you have pets, is there an area where you’ll be able to securely store their extra food? (more…)

Let’s Talk about Parking.

Oink if you love Bacon!

Guys, I can’t believe I’ve spent nine months writing this blog and haven’t done any posts about parking! Major oversight. Fixing that right now. Today is rental parking day, all day. Tasty crunchy numbers that you’ve come to know and love, but this time for your car. I’m excited. But first…

What We Will NOT Be Doing Because CNT Does It Better…

First of all, if you’re looking to assess the total cost of transportation in Chicago, this is not the place. We’re talking about parking here. However, the fabulous Center for Neighborhood Technology has two apps that will serve you nicely. Abogo will tell you, by location, how much you can expect to spend per month on transportation. And yes, it’s location-sensitive for you people on smartphones. There’s also the Housing + Transport Affordability Index, which allows you to compare neighborhoods by the full combination of home prices and transit costs.

I ♥ the CNT. You should too. This is their logo.

Oh and while we’re on the subject, PublicTransportation.org has calculators that can help you compare the cost effectiveness and carbon neutrality of driving vs taking the CTA.

If you’re looking for the cost of getting from place to place, those guys are doing an excellent job of spitting out the numbers, and they’re getting grant money to do it, so more power (and less carbon) to them. However, they don’t talk about what happens when you’re done driving about and have to plonk your car down, preferably in a place where the city’s parking elves can’t trim it with orange.

Looks just like Christmas. If, y’know, orange was a Christmas color. (via theexpiredmeter.com)

So You Want to Rent a Parking Spot.

The phrase “EZ street parking” or something similar shows up in a whole lot of apartment ads. You can always try to park on the street, but this is Chicago. We’ve got meters, curb cuts, residential parking zones, alleys, driveways, disabled parking zones and snow routes to consider, not to mention our supercritical mass of hydrants that seem to multiply at an exponential rate. On many streets, tiny puddles of shattered glass bear silent witness to the car windows that have gone before you. I don’t blame you for wanting to stow your precious vehicle somewhere off of the streets.

A vision from the future. This is how a Chicago sidewalk will look in 2022.

The first question, of course, is how much you’re going to pay for parking at your apartment. Therefore, I have taken a glance through the MLS to see what the rates have been for off-street rental parking in seven different neighborhoods over the past year. I counted the printed rent rates for any parking spaces listed as available with apartments that successfully rented. I also took a quick average of the rents paid for the apartments so that I could get a rough ratio of what it costs to house people as compared with their cars.

Average Parking RentParking Rent RangeAvg Parking as percentage
of Average Rent
East Rogers Park
Uncovered$60.10$1-1505%
Covered$102.08$50-1759%
Albany Park
Uncovered$88.46$75-1507%
Covered$93.33$60-1257%
Hyde Park
Uncovered$95$50-1456%
Covered$137.50$100-1759%
Lakeview
Uncovered$135.81$1-2607%
Covered$157.88$75-2758%
Wicker Park & Bucktown
Uncovered$157.14$100-2507%
Covered$171.43$100-2508%
South Loop
Uncovered$161.84$75-4007%
Covered$197.05$150-4009%
Near North Side
Uncovered$209.50$100-3008%
Covered$230.09$100-437.509%

I chose three neighborhoods that are, in my opinion, underserved by the CTA – Albany Park, East Rogers Park and Hyde Park. All three have bus service but very little train service. I also chose Lakeview and Wicker Park/Bucktown, two popular but lower-density neighborhoods with good CTA service. Finally I also chose two luxury, high-density neighborhoods with lots of high rises and 3rd party garages, but not a lot of street parking.

As you can see, pretty much across the board you can expect to pay an additional 5-8% of your rent for uncovered parking spaces, and 7-9% of your rent for garage parking. It’s remarkably consistent across all of the neighborhoods I studied. Personally I went into this thinking that parking prices were pretty arbitrary, but it looks like there’s a method to it.

So if you want to avoid street parking, be ready to up your housing budget by 7-9%.

But Can You Even Get One?

Parking prices are lovely to know, but what sort of availability are we looking at? Do you have a one in ten shot at finding an apartment with parking, or is it pretty much guaranteed? And what if you can’t increase your rental budget by another 7-9%? Well, if you’re working with a Realtor to find an apartment in these neighborhoods, chances are pretty good that you’ll find an apartment with parking. However, chances of finding one with free parking vary more widely from neighborhood to neighborhood. Check it out.

NeighborhoodUnits with free garage ParkingUnits with any free parkingUnits with any assigned parking at all
East Rogers Park10%27%53%
Albany Park21%32%55%
Hyde Park14%29%41%
Lakeview18%30%70%
Wicker Park & Bucktown41%62%81%
South Loop45%49%94%
Near North Side19%20%83%

Once again we’ve got those same seven neighborhoods, and for the sake of comparison I’ve even included them in the same order. I was surprised to see that in all but one of the neighborhoods I studied, over half of the apartments rented this year had some sort of parking available. Not a lot of parking for rent in Hyde Park, but given the demographic makeup and more insular nature of the neighborhood, plus an abundance of university parking lots, I don’t find that too surprising.

University of Chicago Logo

U of C. 215 acres from which you will never depart for your entire four years of undergrad.

What I did find interesting is the breakdown of free parking vs. paid parking. The most expensive neighborhood, Near North (including tony districts like Streeterville, River North and the Gold Coast) offered nearly universal parking availability, but the lowest percentage of free parking out of the seven districts. In other words, if you’re living around there you’re going to have to pony up extra for parking. Meanwhile, South Loop has even greater parking coverage with 94% of the rented units offering at least one parking space, but almost half of them were free garage spots.

Most impressive was the showing put forward by Wicker Park & Bucktown, two areas that always make me pull my hair out trying to find parking when I’m down there for a night out. With 81% of the apartments over the past year offering some sort of parking and 62% of them offering free parking, this area offered what might be the best scenario for renters with cars. (Of course, finding an apartment in these two trendy neighborhoods is a challenge, but if you survive the Thunderdome of Wicker Park apartment hunting at least your car will be safe, right?)

Vision from the future. Wicker Park apartment hunting competition in 2022 will involve gladiatorial combat.

What Did I Forget?

Hopefully that answers some of your questions about parking. If you want me to crunch the numbers for your neighborhood just drop me a comment or use the contact form.

Dear Piggy: Questions from the Readers

I’m writing this on Tuesday night at 7pm. I’m deliberately avoiding watching the election results. So you guys get an omnibus of nine questions that have come in from the readers.

I didn’t show up for eviction court in Cook County. What will happen?

Generally if one side shows up for eviction court and the other doesn’t, the present person generally “wins” the case – for now. So, if the tenant appears but the landlord does not, then the landlord has to start all over again and re-file a new case. If the tenant doesn’t show up but the landlord is present, it’s a bit more complicated. The landlord will have to prove that the tenant was served with proper notice of the court date. They will also have to prove that the tenant has committed the offense that is causing the eviction case, be it non-payment or some other behavioral problem. A landlord in this case will probably get possession of the unit but no money judgment. However, the landlord should not rest on their laurels – many tenants in this sort of situation will “lawyer up” and get the case reopened before the sheriff can actually come around to evict.

If my landlord takes a utility bill addressed to me out of mailbox is he responsible for paying it?

First of all, if the landlord takes anything addressed to you out of your mailbox, she has committed mail fraud. This is a federal offense punishable by a minimum prison sentence of five years.

As for the financial repercussions. If your bill is tied to your name and your social security number, your credit score will bear the brunt of it going unpaid. So regardless of whether or not you think the landlord has “claimed responsibility” for paying the bill by taking it, you have a responsibility to ensure that the bill gets paid on time. I would get a backup copy from the utility company’s online account system and pay it anyhow.

However, if you don’t pay your heating bill and your pipes freeze and burst, your landlord will bear the cost of repairing the damage. The repair bills will certainly exceed your security deposit. So the landlord has a vested interest in ensuring that you’re current on your heating bills, but generally not to the point of paying it themselves. A smart landlord, though, would find out the status of payment in another way or just deal with repairing the damage afterwards. In my opinion, it’s better to be able to bring an air-tight damage suit against a tenant after the fact than to incur a five year stay in a federal prison.

Is a two flat in Chicago bound by the landlord tenant ordinance?

For two-flats, if the landlord lives in the building it is exempted from the Chicago Residential Landlord Tenant Ordinance but is covered by the Illinois state ordinance (PDF) instead. If the landlord does not live in the building then it is covered by the Chicago ordinance.

My tenants’ apartment is disgusting. Can I ask them to clean for showings?

Well, technically, yes. And according to the CRLTO they have to comply.

CRLTO Section 5-12-040 Tenant responsibilities.

Every tenant must:

(a)     Comply with all obligations imposed specifically upon tenants by provisions of the municipal code applicable to dwelling units;

(b)     Keep that part of the premises that he occupies and uses as safe as the condition of the premises permits;

(c)     Dispose of all ashes, rubbish, garbage and other waste from his dwelling unit in a clean and safe manner;

(d)     Keep all plumbing fixtures in the dwelling unit or used by the tenant as clean as their condition permits;

(e)     Use in a reasonable manner all electrical, plumbing, sanitary, heating, ventilating, air conditioning and other facilities and appliances, including elevators, in the premises;

(f)     Not deliberately or negligently destroy, deface, damage, impair or remove any part of the premises or knowingly permit any person on the premises with his consent to do so; and

(g)     Conduct himself and require other persons on the premises with his consent to conduct themselves in a manner that will not disturb his neighbors’ peaceful enjoyment of the premises.

The pertinent bits here are items (b) through (e) above. As always I recommend that landlords try to negotiate a more calm & reasonable resolution to the problem before they throw the book at their tenant. However, in a worst case scenario the landlord can present the tenant with a 10-day “cure or quit” notice which mandates that they clean up their act within the next 10 days or their lease will be terminated.

However.

If the tenant does not comply with the notice then the landlord will have to evict them in order to enforce the notice, so obviously this is not terribly effective when it comes to an apartment that will probably be empty in a matter of weeks anyhow.

Here’s my personal thoughts on the matter. If a tenant has such poor housekeeping skills that the apartment is “disgusting,” I highly doubt that their cleaning efforts under duress will be too impressive. Chances are you will need a few days or even weeks to get the place cleaned up in between tenants, so why bother wasting your time showing a dirty apartment? It won’t rent at a top price, and you’ll have to show it many more times to find a tenant. Besides, the only tenants who will probably like a messy apartment are also messy, so you’ll wind up with a self-perpetuating cycle of filth. Here’s what I would do instead.

  • Explain to the tenant that the apartment is too messy to show in its current condition.
  • Explain that the condition of the apartment has been noted in their file.
  • If your lease doesn’t already allow for specific cleaning costs, provide the tenant with the prices for a deep clean by a professional maid service and make sure that they know you will have to deduct that cost from their security deposit.
  • Hold off on showing the apartment until it’s empty and clean.

Can I pretend that my friend was my past landlord?

This is called “fraud.” It’s a bad idea, although tenants with poor rental history (or tenants who assume that their landlord hates them for any reason) do it all the time.

Will you get caught? That depends on if your landlord verifies ownership of your current address or not. It’s very easy to do. If you get caught, I’d personally not be surprised if your landlord rejects your application.

If you don’t get caught before you sign the lease, you’re pretty much in the clear. Even if you wind up in eviction court and the landlord accuses you of falsifying the application, it’s his neck on the line for not doing enough research.

Courtesy of the Encyclopedia of Chicago History.

What’s the difference between redlining and steering?

Redlining and Steering are both practices that violate fair housing law. Redlining was originally a mortgage lending term which drew a “red line” around certain neighborhoods. Applicants that didn’t fit a particular profile would not be granted loans to purchase property within the red line. Steering occurs when members of certain demographic groups are “steered” towards neighborhoods that are known to be dominated by that same group – e.g., Asians being shown only properties in Chinatown.

So basically, Redlining keeps people out of a neighborhood. Steering pushes them into specific enclaves.

Both are illegal.

Can tenants watch TV at any time of night?

I’m guessing that this is really a noise question. Look up to where I quoted the Chicago Landlord Tenant Ordinance above. As long as the tenants aren’t disturbing their neighbors’ peaceful enjoyment of their homes and apartments then the tenants can do whatever they want. However, if neighbors are complaining that the noise from the TV is affecting their sleep, health or ability to use certain rooms of their house, then the landlord may need to step in.

Of course, the tenants should try to work out the noise issue between themselves before escalating it to involve any authority figure, be it the landlord or the police. The landlord’s only recourse will be a written reprimand or, in the worst case scenario, a 10-day “cure or quit” notice followed by an eviction case.

When can you charge a late rent fee in Chicago?

Illinois and Chicago do not have “grace periods” for rent payments. Therefore, unless a lease specifies a grace period, rent is late on the day after it is due and fees can be assessed at that time. Also, bear in mind that while the IRS may count the date of postmark, a landlord doesn’t have to. As for what time late fees should be assessed, that’s up to you. I personally recommend giving the benefit of the doubt and assessing late fees when business opens the day after rent is due. I know some landlords who assess late fees as soon as midnight passes, though. Either could technically be claimed as valid, but the former is more likely to hold up in court.

Will my cat stick to my radiator?

Not unless you physically attach him to it.

Cats are generally smart enough to move away from dangerously hot objects like stoves and radiators. A radiator heated by steam (212 degrees F) will not get hot enough to melt fur (300-400 degrees F depending on humidity). It might give him a little burn the first time he touches it, though, so use caution around kitty the first time the radiators come on.

Rent Bacon: September 2012

Zone 3? What are you doing?! Zone 3! Stop!

Ladies and Gentlemen, It’s the Offseason!

Remember last month when I said that the August rental stats would probably be the last reliable analysis we get on the Chicago market until spring? Well, the September stats are here, and I was correct to a certain extent. They are definitely all higgledy-piggledy. However, there is some amount of information we can wring out of the numbers if we look closely.

Zone 1 – big slowdown

The rents in the downtown area (Zone 1) once again showed improvement, both over where we were 12 months ago and where we were one month ago. However, the market times, while better than they were last year, are a little longer than we saw in August. After all of my talk about how the market slows down in the late summer you’d think we’d see those rent rates drop, but instead we see the change in the number of units rented. Yes, the rents went up, but fewer of them filled, leaving more to coast into October. In August we saw 215 units rent, and in September of 2011 it was pretty close to that same number at 212.

So for Zone 1, this means the agents probably were hoping that the standard seasonal downturn would be offset by the extremely hot rental market that we’ve seen over the pat 12 months and did not lower their prices in anticipation of the annual 50% drop in demand that occurs as September ends. I’m thinking based on these numbers that the average Zone 1 asking rent on a two bedroom apartment needs to come down by about 10-15%. My bet is that next month we see a much higher market time as many of the units will have remained on the market into October.

Zone 2 – Slight slowdown

Moving out of the luxury market into neighborhoods with trendy names and smaller architecture, the Zone 2 results show a more gradual relaxation but there is no doubt even here that the end of season had an effect on the September numbers. While rents were higher than they were in 2011 by about 3.5% and market times were two days shorter, they actually fell 2.8% from where they were just a month ago in August of 2012.

Market times were consistent, so it looks like the Zone 2 agents have a better ability to anticipate the end of the rental season. I think that downtown/Zone 1 is seeing some Realtors dabbling in rentals when they normally handle sales only. The Zone 1 market has for years been the near-exclusive province of the property management companies with in-house leasing staff. It’s only in the past two years that the condo-to-rental market has necessitated that downtown Realtors sidestep into leasing. Many of them probably started doing rentals sometime this year and couldn’t predict what was coming as the weather turned colder. By contrast Zone 2 agents (and Zone 3 agents as we’ll see) are more practiced in the apartment market and were able to warn their clients. As a result, while the total number of units rented was still a 23% drop over last month, it was pretty consistent with the 2011 performance. Well done, Zone 2!

Zone 3 – Ouch.

Oh my goodness what the heck happened in Zone 3? 5.6% lower rents and almost 50% longer market times compared with 2011. A 10% drop in rents since August. The lowest attained rents since January. What happened? The answer lies in what happened at other sizes. Remember, Rent Bacon is a snapshot of 2 bedroom, 2 bath apartments only. Our drop in Zone 3 was absorbed by the larger 3 bedroom, 2 bath apartments.

Renting at an average price of $1615 this year, 3 bedroom apartments in Zone 3 are far more affordable than a 2 bed in any other zone, and not terribly much more expensive than a two bedroom. Renters have noticed this. They only rented eight 3 beds in September of 2011, but this year they rented 21 of them. Almost 300% growth in demand. Coupled with the standard price drops and increased market times of the off-season, this shift in popularity is what caused such disastrous numbers for Zone 3 two bedroom apartments.

The Numbers

Average RentAverage Market TimeTotal Rented
Zone 1
September 2011$245233 days212
September 2012$255826 days163
Zone 2
September 2011$196323 days87
September 2012$203121 days80
Zone 3
September 2011$140529 days26
September 2012$132746 days24

Stats reflect pricing and activity for 2 bedroom, 2 bathroom apartments listed in ConnectMLS as with rented dates during the month of April. Analysis of specific areas is available upon request.

What is Rent Bacon?

Rent Bacon is a quick visual summary of what’s happening in the rental market this month compared with this time last year. It breaks the city down into three zones. For each zone, it takes the change in average rent rates and the change in average market times as percentages, and then averages the two percentages together.

Zone 1 covers central Chicago from South Loop through Lincoln Park. (Actual coordinates: 2000 South to 2000 North, from Western Ave to the Lake).

Zone 2 covers the near North side of Chicago, including Lakeview, Bucktown, Uptown, Lincoln Square, Roscoe Village and NorthCenter. (Actual coordinates: 2000 North to 5200 North, from Western Ave to the Lake.)

Zone 3 covers the Far North and Near South side of Chicago, including Edgewater, Andersonville, Rogers Park, West Ridge, Chinatown, Bridgeport and Douglas. (Actual coordinates: 5200-7600 North plus 2000-4500 South, from Western Ave to the Lake.)

Want more Rent Bacon? Here’s all of them on one page!