This analysis models a typical BRRRR project in Near South Side at the neighborhood median ARV of $525K. Real-world projects vary substantially based on property type, condition, and submarket dynamics.
Acquisition and rehab assumptions
| Acquisition price (85% of median) | $361K |
|---|---|
| Rehab budget (midpoint) | $115K |
| All-in cost | $476K |
| After-Repair Value (ARV) | $525K |
Monthly cash flow model
| Estimated monthly rent | $4K |
|---|---|
| Property tax (Cook County investor classification) | −$1K |
| Insurance | −$219 |
| Vacancy reserve (7%) | −$312 |
| Property management (8%) | −$357 |
| Maintenance reserve (6%) | −$268 |
| Net Operating Income (monthly) | $2K |
| DSCR refi at 75% LTV / 7.5% / 30yr | $394K loan, $3K P&I |
| Monthly cash flow after debt service | $-540 |
| Cash left in deal after refinance | $83K |
What this tells us about Near South Side
At the Near South Side median, a typical BRRRR project produces approximately $-540 per month in cash flow after a 75% LTV DSCR refinance. With approximately $83K remaining in the deal after refinance, this represents a -8% cash-on-cash return on the remaining capital — before appreciation.
South Loop saw significant overbuilding in the 2000s; absorption has caught up. Condo flips work in established buildings; new construction has slowed. Townhome rehabs have margin but require careful comp analysis.
How this scales across Near South Side
Near South Side's housing stock includes high-rise condo, townhome, mid-rise condo, loft conversion. Multi-unit properties (2-flat, 3-flat) typically produce 30–60% higher gross rent than single-family at similar ARVs but carry higher tax burdens and management overhead. Single-family rehabs often have stronger exit liquidity (owner-occupant buyers) but lower cash flow.
Sensitivity considerations
- Rent assumption: Modeled at ~0.85% of ARV. Actual rents in Near South Side range from 0.6–1.0% depending on property type and condition.
- Property tax: Modeled at 2.5% of ARV for Cook County investor classification. Successful tax appeal can reduce this 15–30%.
- Interest rate: DSCR refi rates currently range 7.5–9.5% depending on borrower profile and leverage. A 1% rate change moves monthly cash flow by approximately $100–200 on this deal size.
- Rehab budget: Modeled at midpoint of $55K–$175K. Common considerations on Near South Side housing stock (HOA approval delays, special assessments) can push budgets higher.
Near South Side cash flow FAQ
Estimated monthly rent for a stabilized investment property in Near South Side at the $525K median ARV level is approximately $4K per month — a rough rule-of-thumb estimate at ~0.85% of ARV. Actual rents vary significantly by property type (high-rise condo, townhome, mid-rise condo, loft conversion) and condition.
On these estimates, a typical BRRRR project at the Near South Side median ARV produces approximately $-540 per month in cash flow after debt service (at 75% LTV DSCR refi, 7.5% rate, 30-year amortization). Cash left in the deal after refinance: $83K. Individual deals vary substantially.
For a property in Near South Side valued at the median ARV of $525K, expect approximately $13K in annual property tax (Cook County investor-classification, before exemptions and appeals). Chicago city properties were reassessed in 2024 — many neighborhoods saw material assessment increases.
Near South Side typically supports a rent-to-price ratio in the 0.6%-0.9% range depending on property type and condition. Multi-unit properties (2-flat, 3-flat) generally produce higher ratios than single-family. The 1% rule rarely applies in Chicago neighborhoods — but BRRRR works at lower ratios when appreciation supports it.
This is a directional cash-flow model, not personalized financial advice. Rent estimates, tax rates, and refinance terms are illustrative. Validate every assumption with current market data and your own underwriting before committing capital.