How I found an apartment in Old Town

I started looking for an apartment in mid-May with a goal of moving in on July 1. In hindsight I should have started in early April because doing so would have allowed me more time to get a feel for the market before the bulk of the July 1 inventory became available.

Why I wish I had started my search earlier than I did

While the bulk of July 1 inventory seemed to post to sites like Craigslist, Zillow, and Domu in mid-May, I wish I had begun my search a month earlier so as to develop a sense of fair market value before I started seeing places I could potentially rent. It takes time to get a feel for what’s a decent deal and what’s not, and you really want to be able to walk in and say yes immediately when a good deal comes along for your desired lease start date.

How I got a sense of fair market value

I think it took 6 apartment viewings before I had a sense of value. Here’s how I approached understanding market value:

  • My price target was $4,500/mo for a 3br.
  • I saw 6 apartments with prices ranging from $3,000 to $6,000/mo.
  • I made sure to see apartments located in high-rise buildings, low-rise buildings, and houses. Examples:
  • I used a broker to quickly see three apartments and then found the other three apartments on Craigslist.
  • After seeing these 6 apartments I felt qualified to make a decision as I viewed additional units.

My sense of the market for 3br apartments in Old Town

Here’s how the market for 3br apartments in Old Town seems to look as of writing (Summer 2017):

  • There are far fewer 3br units in Old Town than there are 1 and 2-br apartments.
  • The distribution of 3br units seems relatively evenly split between high-rises, low-rises, and houses.
  • What you get for:
    • $3,000/mo:
      • What: Murder shed-type apartments in houses on secondary streets like North Park Avenue. They likely abut the Brown Line and shake every few minutes as a train rolls by. Poor appliance quality.
      • Who manages them:  Individual landlords who maintain them purely for rental purposes.
      • Who rents them: Seems to be a lot of early-twenties females who plan to spend a year or two at most in their apartments before moving home to Indianapolis or on to a better Chicago apartment.
    • $4,500/mo:
      • What: Clean, well-maintained and generally up-to-date apartments on main roads like Wells, LaSalle, and Clark Streets. Nothing fancy but very good places to live.
      • Who manages them: Professional property management companies or individual landlords who plan to live in them some day.
      • Who rents them: Young professionals and families.
    • $6,000/mo+:
      • What: High-end townhouses on major streets or quiet, desirable secondary streets.
      • Who manages them: Professional property management companies or individual landlords who plan to live in them some day.
      • Who rents them: Not sure – probably affluent families.

Where I looked for apartments

I used 5 sources to find available apartments (listed in order of importance):

  1. Craiglist (PadMapper provides a good visualization tool for Craigslist listings)
    • Pros: Best source of  listings, particularly for listings marketed by the owners themselves (rather than by a broker or management company)
    • Cons: A lot of the listings are “fake” in the sense that they’re for already-rented units posted by brokers hoping to use them to meet new clients – i.e. you call the number on the listing and the broker says “Hey sorry, this apartment just rented but I happen to have 4 more listings just like it!” (They’re never as good as the listing you found)
  2. Walking around Old Town and looking for “For Rent” signs:
    • Pros:
      • If you see a high rise building you like you can often walk right in and speak to the doorman about seeing available units.
      • Sometimes individual landlords have posted “for rent” signs but haven’t yet posted their listings on Craigslist
      • You immediately understand the apartment’s situation in the neighborhood
    • Cons: 
      • Time-consuming
  3. Walking around Old Town and looking for “For Sale” signs:
    • The way this works is that you look for “For Sale” signs and then get out your phone and look up the listing online. If the listing is more than 30 days old there’s a chance the owner is interested in renting rather than selling. You call the listing agent and ask if this is the case and go from there.
    • Pros: Gives you a shot at unlisted properties which are always going to be your best bet
    • Cons: Time-consuming and low-percentage.
  4. Zillow:
    • Pros: Convenient; great website.
    • Cons: Zillow seems to be used by higher-end places only in Old Town. There was a lot of mid-range and low-end 3br inventory on Craiglist that did not make Zillow.
  5. Brokers:
    • Pros: All you have to do is call them and answer a few of their questions and they’ll quickly set you up with 3-4 viewings.
    • Cons: I spoke to nearly a dozen brokers over the course of my search and they were collectively able to show me exactly one apartment that I hadn’t found myself online. I’m sure there is a segment of the market in which brokers are valuable (perhaps at the very high end?), but in my price range ($3,000 to $6,000) they seemed to serve only as outsourced labor for people who don’t want to search for apartments and set up appointments themselves.
      • People often point out that every renter should use a broker in Chicago because they’re paid for by the landlord rather than by the tenant (the opposite is true in New York).
        • I disagree with this argument as I think you give up a lot of control over your process if you rely on a broker – The broker’s only going to show you what he wants to/is able to show you. Once you start working with multiple brokers so as to see more inventory then you might as well just start calling landlords directly yourself.

The decision

The apartment I rented was the 12th apartment I saw and I knew as soon as I walked in that I wanted to rent it at the posted price. I called the landlord immediately and made an offer of a monthly rate somewhat below the asking price and settled somewhere between my offer and the posted price.

 

 

 

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