CHICAGO NEIGHBORHOODS
New neighborhoods coming soon!
INDUSTRY REPORTS
New reports added monthly!
Home Ownership & Property Types
Chicago is world renowned for the birth of the skyscraper, but as you contemplate buying a home or investment property, it is important to understand all that Chicago has to offer in addition to a beautiful skyline. When buying a home, you should familiarize yourself with not only the types of home ownership but also the property types available in Chicago. Fee Simple and Condo are some ownership terms that you might encounter as you explore different properties. There are also many different property types (e.g., single family homes, condos, lofts, etc.) available in the Chicagoland area, all of which are described below. Each property type offers a very different style of living, which is why it is important to consider them all and narrow down what you are looking for to make your search process run more smoothly.
Home Ownership
Fee Simple can be defined as having an unqualified ownership interest in a property or other real estate. In most cases, people who own a home in Fee Simple not only own the home’s interior and exterior, but they also own the land beneath, and in front and back of the property, as well as having some rights to the air space above the property. In contrast, people who own property with a condo ownership, only own the inside of the unit itself. The land below the property, the air space above the property, the front and back yards (if any), the exterior of the unit, the stairs and grass areas outside of the unit (if any), are all owned collectively by all the unit owners within the development. This type of ownership gives the owners the right to use the common areas. Each unit has its own tax bill, deed, mortgage and ownership rights but shares in the maintenance of the common areas.
Property Types
Single-Family Homes (SFH):
The single-family home is loosely defined as a free standing residential structure. In most cases buying a SFH involves buying a parcel of land as well. However, sometimes a SFH is used to describe a row-house or coachhouse, in which case these property types are usually not fee simple (described above). Chicago has many options for buyers interested in single-family homes with many attractive properties at a wide range of price points.
Condos:
From posh penthouses to contemporary studios, condominium buildings offer many advantages to prospective buyers. Condos are individual units within a large multi-dwelling unit. They often offer certain amenities that a single-family home cannot provide such as pools, gyms, business centers, movie rooms, concierge services, doormen and much more. Condo owners share the costs of maintaining the structure and land external to the units, typically referred to as assessments. Many buildings that look like apartment complexes are actually individually-owned condos in Chicago.
Lofts:
In the early 1900's, Chicago was a large industrial city with many factories in the meat, printing and distribution industries. In recent years, many of these old factories have been converted into unique, livable units called lofts. A big allure to many lofts is the building's character and history, not to mention they can typically accommodate almost any style due to the raw and industrial nature of the property. The timber lofts of River North and concrete lofts of the South and West loop are just a few of these unique spaces that have become highly sought after properties. Lofts typically have some, if not all, of the following features: large windows, high ceilings, exposed concrete and/or brick, antique flooring and sometimes, if you're lucky, large stained glass windows with an exorbitant amount of natural light.
Two- and Three-Flats:
Two-and Three-Flats are very common in the Chicagoland area. These properties look similar to a single-family home (SFH) but are made up of two or three individual units, either apartments or condos. As a buyer you would be buying the whole building and could look to rent/sell the individual units, live in one of the duplexes (2 story units) or simplexes (1 story unit) and rent out the other to help with the mortgage or convert the entire building to a traditional SFH.
Townhomes/Row-Homes:
Townhomes/Row-homes generally have two or more stories and are attached to a series of similar residential units. They may or may not share common walls. Townhomes can be an attractive option for buyers in Chicago that are interested in some areas so densely built that detached single-family houses are uncommon or almost nonexistent.
Investment Properties:
An investment property is typically purchased to generate rental income. Buyers interested in investment properties can consider all of the property types discussed above as well as parking lots, apartment buildings, store fronts and even strip malls. A buyer's intention with this type of purchase is to typically be cash flow positive or to offset a portion of the mortgage and create capital gains through appreciation. Contact us for additional information about this subject if you are interested in buying investment properties.
Sustainable Living Properties:
In recent years there has been increasing interest in sustainable living to help the environment and decrease living expenses. Builders and developers have been working to find solutions to achieve a more sustainable way of living since just using recycled materials isn't good enough and buyers are interested in saving energy and reducing costs. The Leadership in Energy and Environmental Design (LEED®) has established a set of standards and a certification that provides independent, third-party verification that a building project meets the highest green building and performance measures. Since the certification is a relatively new development across the nation, the number of certified properties is not as prevalent as properties that meet the historical building standards, but these building types are becoming more common every day. John is member of the USGBC® and can provide you with additional information on sustainable living in the Chicagoland area if you are interested.
