Cheap Old Apartments

Beating the urban housing market

Years ago during the pandemic I became taken with an instagram page. cheapoldhouses. Much has happened since then, they’ve gone on to produce a tv show, they have a merch shop, a newsletter, a veritable operation. But in 2020 it was an instagram page, sharing interesting old houses for sale, mostly under $100K and some as ludicrously cheap as $10K or $30K, with a community of like minded people. Burnt out on the urban housing crisis the listings gathered on their page were a siren call, an opportunity to imagine a simpler life where one was free from the debt burden of modern financialized housing. People were buying their cheap fixer uppers, often in cash and documenting their journey. Not only that but a lot of the people doing so embraced the quirkiness of their homes. Funny colored bathroom tiles and 60 year old kitchen cabinets became something to be celebrated, not ripped out and replaced. In a world where, according to Harvard’s Joint Center of Housing Studies half of Americans are rent burdened, and home ownership is increasingly often viewed as a fantasy this lifestyle choice seems compelling. How important are central air, the latest finishes and proximity to a big city worth really?

The cheap old houses instagram

All of those I could do without, except the proximity. I’m an urbanite as much as I roll my own eyes at that. I’m a Flaneur (double eye roll), it’s my deepest hobby to walk around and take in the city. The history, the architecture, the oddities. The financial fantasy Cheap Old Houses presented however was compelling however. And when through a series of events (another story) led to me selling the apartment I was living in at the time, I must have subconsciously had that fantasy in the back of my mind. One day when refreshing realtor.com a new listing came up. A grainy single photo of the exterior of an old walk up building, no description and a price. But I’d been past the building on foot many times, it was a classic 1920’s building. A courtyard building. Listed at $110K. Blocks away from where I was living at the time. Nestled between the lakefront and the red line, one of the worlds few 24/7 transit options. I texted my realtor immediately and the next day we were there.

If you’ve seen one of these 1920’s buildings around Chicago you’ve seen hundreds of them

The listing agent was a cool 20 minutes late and mentioned the family was selling their late mothers apartment from out of state. We climbed the stairs and the agent unlocked and opened the door. I was almost immediately swept over by the stench. If you’ve ever had a relative who smoked indoors you now just how permeating that smell can be. After I’d covered my nose with my shirt I took a look around. It was about 900 square feet. One Bedroom one bath. A Living room, a dining room, a sunroom connected to the bedroom and the living room. 5 Closets and a kitchen. Everything was a faded beige, the hardwood floors were scratched and stained, the windows seemed far newer than the building, maybe 20-30 years old but had deep orange water stains between the double pained glass and one appeared to be simply resting in place instead of hanging. The kitchen had just a farmhouse sink, a non functional stove and one wall of cabinets (with matching saloon doors). The bathroom had been updated, in the 70’s, the tile covered in a beige caulk that had been used as a patch over the years. Through the animal urine and cigarette smoke I smelled opportunity.

Note the cigarette tar staining these blings (and walls)

I figured the lack of photos posted online and frankly, nasty shape of the apartment might give me an advantage. One other small detail, this apartment was a co-op not a condo. Which for those not in the know basically means buying is a bit more involved. Rentals are usually restricted and the board has to approve purchasers. Coops were the only way to ‘own’ an apartment until Condo’s were ‘invented’ in the 60’s. Coops are seen as a lower investment grade than a similar condo which turns a lot of would be purchasers off. Not me, I had no interest in leasing the place out. But it was leverage.

$110K. Not a lot, but considering the amount of work needed, deep cleaning, odor remediation, painting, floors refinished, bathroom, kitchen, windows I wasn’t sold. Completely refinished units in the building were asking $150K. I estimated more than $40K of work was needed. So I low balled them. And to sweeten the deal I offered to pay cash, I don’t recommend doing this by the way. But coming off of selling my then current place I had a lot of appreciation equity to throw around (on top of the savings I’d accrued while living there). I started low at $80K and we settled at $95K. It was mine. A paid off (shit hole) apartment.

It was in no condition to move into. Immediately I called a number of professional cleaning services and explained the condition. Odor remediation may seem like a splurge but I was willing to pay the pros. After all it wasn’t like I had a mortgage. I got a number of estimates some as high as $12K before I settled on a team willing to do it for $1.8K. This involved having the walls and ceilings scrubbed with a chemical treatment and a week of running ozone machines throughout the unit. It mostly worked! The next step involved having the floors sanded and refinished while it was still empty. I settled on a coffee tone meant to hide the deeper stains from pet accidents past. In retrospect this may not have been the most historically accurate stain color but I’m a sucker for dark wood tones.

Odor vanquished

I had some painters come in and I was good to move in. The windows, kitchen and bathroom would have to wait for my budget to allow it. Because surprise, dumping all of my equity and savings into buying with cash and then like $7K into some light reno work didn’t leave me with much liquidity left. (Cheap old house reality). What’s a year or two with a not very functional kitchen, windows that are nearly falling out of their frames and a bathroom that looked like it belonged in a neglected summer camp? You get through it and you save. One notable difference between a cheap old house and a cheap old apartment are….your home owners association. Something that is actually really important in a multiunit building! The rules are important when you share common plumbing, electric and walls and ceilings, not just when you’re renovating but in your day to day living. Some of these rules were pretty foundational, such as construction being limited to business hours. Monday - Friday; 8 - 5. Extremely fair, as you don’t want somebody putting floors in at night or shutting the electric off on the weekend. For somebody like me who works a typical white collar job this did mean doing anything myself wasn’t really an option unless I wanted to use PTO for construction (I didn’t want to do that). So I had to hire out (additional $$$).

Lived with a dumpy kitchen for a year and a half and scraped the cash together (easier to do with no mortgage) Paid a little under $18K to get that gutted, have the electric redone new cabinets, counters, new appliances, floors, asbestos removal, the works. Then came the windows. After dealing with an extremely slimy contractor who I went around (another story) I got an estimate to get my 10 failing windows replaced for $12K (including labor, parts, etc.). Done. Finances exhausted, again. Another year of saving and it’s time to do the bathroom. About another $18K (I splurged on the fixtures), down to the studs. The cherry on top was a splurge. Having my 1920’s wood doors removed, stripped and refinished. We’ll round up to $5K on this. Extremely worth it if I’m being honest.

Why was the old paint so chunky

So where does that leave me. All in probably $155K. For an apartment that’s worth that if not an additional $10-15K today. Why are the cheap old houses cheap? Because you will inevitably wind up dumping a ton of money back into them. There’s a reason that they’re cheap! Not everybody is willing to live in a project, and I couldn’t blame them. Would I do it again? Probably. Now that I’m done I get to enjoy the fruits of it all. The circumstances of me being able to buy it the way I did leave me in a situation where my only housing bill is my monthly HOA fee, which includes my heat water and property taxes to the tune of $490/month. That’s a small price to pay for a one bedroom apartment in the third biggest city in the country in a dense transit rich neighborhood. It’s not in a hot neighborhood by any means. But none of the cheap old houses are.