This analysis models a typical BRRRR project in South Shore at the neighborhood median ARV of $285K. Real-world projects vary substantially based on property type, condition, and submarket dynamics.
Acquisition and rehab assumptions
| Acquisition price (85% of median) | $166K |
|---|---|
| Rehab budget (midpoint) | $128K |
| All-in cost | $293K |
| After-Repair Value (ARV) | $285K |
Monthly cash flow model
| Estimated monthly rent | $2K |
|---|---|
| Property tax (Cook County investor classification) | −$594 |
| Insurance | −$119 |
| Vacancy reserve (7%) | −$170 |
| Property management (8%) | −$194 |
| Maintenance reserve (6%) | −$145 |
| Net Operating Income (monthly) | $1K |
| DSCR refi at 75% LTV / 7.5% / 30yr | $214K loan, $1K P&I |
| Monthly cash flow after debt service | $-294 |
| Cash left in deal after refinance | $80K |
What this tells us about South Shore
At the South Shore median, a typical BRRRR project produces approximately $-294 per month in cash flow after a 75% LTV DSCR refinance. With approximately $80K remaining in the deal after refinance, this represents a -4% cash-on-cash return on the remaining capital — before appreciation.
South Shore is one of Chicago's deepest Section 8 rental markets. Cash flow on rentals is strong; appreciation has been slow but consistent. Building-level dynamics matter — condo assessments and HOA management can make or break deals. OPC proximity ripple effects starting to show in northern blocks.
How this scales across South Shore
South Shore's housing stock includes vintage condo, 2-flat, 3-flat, historic single-family, workers cottage. 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 South Shore 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 $60K–$195K. Common considerations on South Shore housing stock (lead paint, tuckpointing) can push budgets higher.
South Shore cash flow FAQ
Estimated monthly rent for a stabilized investment property in South Shore at the $285K median ARV level is approximately $2K per month — a rough rule-of-thumb estimate at ~0.85% of ARV. Actual rents vary significantly by property type (vintage condo, 2-flat, 3-flat, historic single-family, workers cottage) and condition.
On these estimates, a typical BRRRR project at the South Shore median ARV produces approximately $-294 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: $80K. Individual deals vary substantially.
For a property in South Shore valued at the median ARV of $285K, expect approximately $7K 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.
South Shore 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.