How He House Hacked His Way to 7 Chicago Rental Units

Luke Helliker (00:00)
so my properties in Chicago have they’ve appreciated quite a bit in value, which is awesome. Right. It’s great to see what similar buildings are selling for. That’s not the same thing as cash in my pocket, though. You know, that’s that’s the long term wealth.

building that for kind of like a 401k, like I don’t plan on touching it for for many years. and my current thesis of how I would like to experience you know both appreciation and cash flow is that you know these purchases I’ve made in Chicago really kind of suit that appreciation play.

But not cash flow.

Michelle Kesil (02:21)
Hey everybody, welcome to the Real Estate Pros Podcast. I’m your host, Michelle Kesil. Today I’m joined by someone I’m looking forward to chatting with, Luke Helliker who is a real estate investor in the Chicago area. So excited to have you here today, Luke.

Luke Helliker (02:39)
Thanks, excited to be here.

Michelle Kesil (02:40)
Great, let’s dive in. First off, for those new to your work, can you share what your main focus is these days?

Luke Helliker (02:47)
Yeah, my main focus these days is operating the units that I own. So my wife and I own seven units in Chicago across two buildings that we manage and operate. And then simultaneously looking for our next investment in a small multifamily property. and we’re looking in Chicago

proper as well as some of the suburbs more affordable suburbs of chicago such as Joliet so right now I have kind of two off market lead generation tactics going for for both Joliet which is a suburb of Chicago and Chicago.

Michelle Kesil (03:35)
Great, and how did you get into real estate investing?

Luke Helliker (03:38)
it was a complete accident, really. I you know, I had some savings and my now wife, her father is a real estate broker. and you know, he suggested that we look at buying a property where we could live in one unit and you know rent the the others out to you know offset the mortgage payments.

And this was back in like right after COVID times, like 2021. and I I wish we had done that done it much sooner than we did. of course, you know, it’s like the time is always now to buy real estate. But in twenty twenty two, my wife saw a building in a neighborhood that we loved and

You know, a few months later we had closed on it. And that is a it at the time was a two-unit building plus a non-conforming unit. So three units, one that is was not recognized by the city of Chicago as a unit, but rented out nonetheless. and we we moved in a few months later and

so began, you know, my career and life as a real estate investor and and property manager. and yeah, it was literally just because of the way the building looked, like at this point we neither of us considered the financials, like how much rent we were getting versus the mortgage payment we were going to be responsible for. So

I a lot has changed since then, and how I look at at deals.

Michelle Kesil (06:19)
What do you feel have been the main keys that allowed your business to grow and run successfully?

Luke Helliker (06:26)
so again, kind of got into this without knowing anything about f honestly like finances at all. and we because of this non conforming unit we had in the building that I mentioned, we were a bit wary, a little bit freaked out about the the state of the unit, like

it we had shared utilities between so this the non conforming unit was in our basement we’re on the first floor and you know we we shared the ductwork so you’re like smelling all of the the tenants cooking and they used like their furnace closet as kind of a storage closet it it just was there was a lot of unsafe

things about the unit. And my father-in-law suggested we look into going through what’s called a accessory dwelling unit program to turn what was this kind of unru this space that was not recognized as a unit into a a legal unit. So this was a pretty massive undertaking. Like, you know, we had to get

a architect to get permits from the city and I you know had no experience with any of this and I started attending real estate meetups in Chicago a few different ones like there’s EUBA it’s Edgewater Uptown Builders Association Chicago Multifamily Club if you’re in the Chicago area all great meetups where

You’re able to meet people who have extensive experience with these kinds of things, or are new, you know, like I was at the time, and can kind of you can can kind of share, you know, horror stories about your experience. But that project it took about a year and we had to do massive renovations to the whole building.

to legalize the unit. And I think that was really kind of the catalyst of getting informed on you know both the Chicago specific real estate requirements in terms of you know having a unit be recognized by the city as a a conforming unit. but also it was like the first time looking at construction costs and

seeing the way that you know basically a a unit could be gut rehabbed and you know different the order in which all of the systems have to be put in place. So that yeah that was definitely the start of going from all right we’re living in a building and you know paying to to live here to okay

This is how you can own and operate a multifamily building. and just seeing the way that adding that unit ended up increasing the property’s value, you know, also the the great wealth building tool that real estate is.

Michelle Kesil (10:30)
Definitely. What is the biggest obstacle or challenge that you’ve overcome in your real estate journey?

Luke Helliker (10:36)
Well no, that’s that’s a great question. I think so I will say in terms of just new things being difficult, that project, the ADU project in our basement was was a big obstacle for sure. it was kind of the first time that I experienced construction happening where I lived.

let alone where my tenants lived. so that was kind of a great like rip the band-aid off moment because all of us that own properties know you know, some level of repair, maintenance, unfortunately, like, you know, disruption to folks’ living situation, you know, whether it’s just like fixing a leak or something more serious.

it’s it’s just part of the it’s part of ownership, right? It’s part of of property management as well. so that that was definitely challenging and and scary, but I think at the end of that I kind of realized like, you know, all this stuff happens and the end product is, you know, a beautiful updated space.

So I think that initially felt like the most challenging obstacle. But fast forward to my most recent acquisition, August of of twenty twenty-five, I bought a building with a really nice lady, but I I am afraid I have to say she was kind of a hoarder. like the her unit was

You know, the the windows had like carpet over them. And I didn’t realize when the carpet came off, it was like, man, like you can’t walk a foot in this place without running into some some junk. and you know, unfortunately, about two months after purchasing the property, this lady passed away. God rest her soul. and it ri

This was once again in in the realm of just new stuff is hard. I was like completely floored by one, just the realization that this has to be a super common occurrence for real estate investors, right? Of dealing with you you deal with every part of life, right? Like, which is kind of a beautiful thing, but it’s also sad in this scenario and kind of scary.

And then, you know, I I found out that she had a partner. I don’t know if this was because she was a hoarder. I didn’t know this person was even living in the unit. They were hidden behind the junk, I guess, or something. But they had someone else living there that it wanted to stay without paying rent. So I kind of had to start

The eviction process, which in Chicago is about a six-month process. fortunately, it didn’t go anywhere near that amount of time. but this was it was a v a massive turnover on this unit. I’d say more of a unplanned rehab, you know, not a gut rehab, but really every inch of livable space had to be

updated, you know, whether painted, cleaned, like deep, deep cleaned. And at the same time, my wife gave birth to our first child. So I was like going from my my house where I I was leaving my newborn child to go to this woman’s unit who had just passed away and just kind of do grunt work.

yeah, you know, it was it was challenging to just kinda put the pieces together on on what was completely an unexpected project. So

Michelle Kesil (15:18)
Yeah, I can imagine those unexpected challenges can be difficult to navigate.

What are you most focused on solving or scaling to next?

Luke Helliker (15:29)
So

It’s something something I think about quite a lot. is kind of this

so my properties in Chicago have they’ve appreciated quite a bit in value, which is awesome. Right. It’s great to see what similar buildings are selling for. That’s not the same thing as cash in my pocket, though. You know, that’s that’s the long term wealth.

building that for kind of like a 401k, like I don’t plan on touching it for for many years. and my current thesis of how I would like to experience you know both appreciation and cash flow is that you know these purchases I’ve made in Chicago really kind of suit that appreciation play.

But not cash flow.

And I would like to increase my cash flow by going out to other markets, more affordable markets, where the appreciation is likely not as great. Hopefully you get some appreciation. but you do end up, you know, with with some cash in your pocket. and of course, you know, after having a healthy reserve for

for any capex items or or maintenance items. and I guess, you know, I I call that out because I think I think in Chicago you probably can accomplish both appreciation and cash flow. but it seems to me that you can kind of split these up and invest in different markets for different purposes. so I

I’m gonna look towards other markets to try to increase that cash flow. and yeah, at the moment I’m looking at a suburb of Chicago called Joliet, looking at small multifamily. I’m I’ve got a routine for reaching out to off market sellers, I guess potential sellers, off market property owners.

Where I’ll send a few letters over a period of about a month and a half or two months. and then if I don’t hear back, you know, reach out with a phone call and then you know call it dead if I if I don’t get any response. And all of this is new. My first two properties I bought on market. so I’d say, you know, what I am I’m trying to accomplish is I’m trying to really build

deal flow to where rather than my first two properties from twenty twenty two to twenty twenty five, you know took three years to get that second one. So I’m really just trying to get in the rhythm of closing on a property once a year. And a lot of you know that’s part of the reason I’m looking outside of Chicago is

I don’t think for me personally I could keep up buying a a property a year in such a competitive market. so so yeah, I guess all that’s to say, just kind of increasing my deal flow.

Michelle Kesil (18:53)
Amazing. Thank you so much for sharing all of that. So before we begin to wrap up here, if someone wants to reach out, connect, learn more, where can people find you?

Luke Helliker (19:03)
Yeah, for sure. So you can reach me on Instagram @lukechicago773. seven seven three is my area code. So it’s and email, it’s just [email protected]. but Instagram is probably probably best, you know, happy to share my phone number as well if you reach out on on Instagram.

And I I love talking to other people. especially I I mean everybody, whether you’re just getting started like like I am. I mean, I feel like I’m just getting started. Or if you’re a seasoned investor. I don’t know if you’re a seasoned investor why you’d want to talk to me, but I’d love to talk to you.

Michelle Kesil (19:48)
Okay, great. Well appreciate your time and your story. Thank you for being here.

Luke Helliker (19:52)
Sure, thank you.

Michelle Kesil (19:53)
And for the listeners tuning in, if you got you, make sure you’ve subscribed. We’ve got more content operators like Luke