Chicago is a two-flat town. From Logan Square to Belmont Gardens, the brick 2-4 unit building is one of the most common homes in the city, and one of the most misunderstood deals to buy or sell. Rents, leases, tenant law and financing all change the math.
Joe and Katherine Tighe, part of the Camille Canales Group at Compass, focus on multi-unit buildings for owner-occupants, investors and sellers. They know how to read a rent roll, how lenders count rental income, and how Chicago's landlord rules affect timing.
Talk to Joe and Katherine about your building. Email [email protected], call Joe at (312) 345-5353, or call Katherine at (708) 847-9913.
Buyers and their lenders price a 2-4 unit largely on income, so a clean rent roll is the most important document you'll produce. For each unit, list:
Add a 12-month operating summary: property taxes, insurance, water/sewer, common-area utilities, scavenger, and repairs. Have copies of every current lease ready. Missing or inconsistent numbers are the fastest way to lose a buyer's confidence or an appraiser's value.
There's no single right answer. It depends on who your buyer is.
Sell occupied when... | Deliver vacant when... |
|---|---|
Your likely buyer is an investor who wants income on day one | Your likely buyer is an owner-occupant who needs a unit to move into |
Current rents are at or near market | Rents are well below market and dragging down value |
Tenants are reliable and leases run past closing | Units need updating that's easier with no one living there |
You want to avoid months of carrying costs with no rent | You can absorb the lost rent during the notice period and marketing |
A common middle path: keep the rental units leased and deliver the owner's unit (or the best unit) vacant, so the building appeals to both buyer types.
Plan the timeline early. Chicago's Fair Notice rules require 60 days' notice to non-renew a tenant who has been there six months to three years, and 120 days for tenants of more than three years. That often means deciding on vacancy four months before you list.
Security deposits (plus any required interest) transfer to the buyer, and the new owner has to notify tenants in writing within 14 days. Getting this right protects both sides; the city's penalties for mishandled deposits are steep.
Living in one unit and renting the others is one of the most effective ways to buy in Chicago. Since late 2023, Fannie Mae has allowed as little as 5% down on owner-occupied 2-4 unit homes, down from 15-25%. FHA allows 3.5% down.
Here's an illustrative $750,000 two-flat:
Owner-occupant, 5% down | Investor, 25% down | |
|---|---|---|
Loan amount | $712,500 | $562,500 |
Rate (illustrative) | 7.32% | ~7.95% |
Principal and interest | $4,894 | $4,108 |
Taxes, insurance, PMI (est.) | $1,600 | $1,250 |
Total monthly payment | $6,494 | $5,358 |
Rent collected (est. $2,400/unit) | $2,400 | $4,800 |
Your net monthly cost | $4,094 | -$558 (before vacancy and repairs) |
Rate from Freddie Mac's 30-year average for Oct. 22, 2026; investor loans typically price higher. Taxes, insurance, PMI and rents are illustrative. Your lender will give exact numbers.
The owner-occupant lives in a $750,000 building for about $4,100 a month, with tenants paying down the mortgage. Lenders can also count most of the expected rent (typically 75%) toward your qualifying income.
Investors need 25% down on a conventional 2-4 unit, so the analysis starts with cash flow, not just appreciation. As the example above shows, at today's rates many Chicago two-flats don't cash-flow with 25% down unless rents are strong or the price is right.
What Joe and Katherine look at with investor clients:
Whether you self-manage or hire help, the basics are the same: keep deposits in a separate account, track lease dates against Fair Notice deadlines, budget for capital repairs, and keep every lease and receipt. Good records today become a higher sale price later.
A one-page checklist for selling, buying and managing a multi-unit building in Chicago.
Download the Chicago 2-4 Unit Checklist (PDF)
They live in a Chicago multi-unit neighborhood, understand how these buildings are financed and leased, and are backed by the Camille Canales Group at Compass.
Talk to Joe and Katherine Tighe. Email [email protected], call Joe at (312) 345-5353, or call Katherine at (708) 847-9913.
Yes, if you live in one unit. Fannie Mae allows 5% down on owner-occupied 2-4 unit homes, and FHA allows 3.5%.
If your likely buyer is an investor and rents are near market, usually yes. If you expect an owner-occupant buyer, delivering at least one unit vacant widens your market.
A unit-by-unit list of rents, lease dates and deposits. Buyers and lenders use it to value the building.
30, 60 or 120 days depending on how long they've lived there.