The Monthly Update - FOR LANDLORDS/INVESTORS

Your Monthly Chicagoland Landlord / Investor Update.

LANDLORD &

INVESTOR

Update

FiveStarRealtyServices.com

January 2023

Welcome to our NEW

Landlord / Investor Update.

It's getting more complicated to be a Landlord in Chicagoland.

What with rules and regulations that cover all of Illinois, rules specific to Chicago, others that apply to Cook County, but only outside of Chicago, and specific rules in various municipalities, who can keep up with all of that.

You've asked for help so we're responding with information that we think you'll find helpful.

Please get in touch with your questions that can address in future editions. Of course call us any time at 773-961-7962 and please feel free to share this newsletter with your friends and colleagues.

Monika Hajkowska SRS, ABR

Managing Broker

773-961-7962

SRS (Seller Representative Specialist)

ABR (Accredited Buyers Representative)

Call us any time if you have questions about anything in this newsletter or if we can help in any other way.

We are a full-service Real Estate Company

In this Newsletter

New in our Blog - Zillow Predictions
New Leases
Rent Increases
New Smoke Detector Rules

New In Our Blog

How will the MidWest do?
Buying with friends and family
Affodability and more...

Zillow's Bold Predictions for 2023

Midwestern markets will heat up, and more friends and family members will pool their money to buy homes together in 2023, as people look for new ways to overcome the housing affordability crisis. However, that crisis will stabilize — if not improve — from its pandemic-era apex. New construction will be focused on rental units, and we should see a jump in homeowners becoming first-time landlords. Those are among a slew of new predictions the Zillow Economic Research team has made for 2023.

Get the full story

1 New Leases

New Leases in Chicago and Cook County

Leases are an important tool in the management of your properties. Overall, having a written apartment lease is important because it helps to ensure that both the landlord and the tenant understand their rights and responsibilities and provides a way to resolve any disputes that may arise during the tenancy.

For the landlord, a lease helps to ensure that the tenant understands the terms of the tenancy and will follow them. It also provides a way for the landlord to hold the tenant accountable if they fail to meet their obligations under the lease. For example, if the tenant does not pay rent on time or damages the property, the landlord can take legal action to enforce the terms of the lease.

For the tenant, a lease provides protection by setting out the terms of the tenancy in writing. This can be especially important if there is a dispute between the landlord and the tenant, as the written lease can serve as evidence in court. A lease also helps to protect the tenant's rights by specifying the terms of the tenancy, including the length of the tenancy, the amount of rent that must be paid, and any rules or restrictions that apply.

City of Chicago

The City of Chicago Residential leases are updated every year. When you are doing a residential lease ensure that you are using the lease for 2023.

Cook County

Cook County instituted their own leases as detailed in the Cook County Tenant Landlord Ordinance.

This lease should not be used in:

Chicago
Evanston
Mount Prospect

Those three municipalities have their own leases.

2 Rent Increases

Increase Your Rent - Legally

It's important to increase your rent to an appropriate level on a regular basis.

Having said that it's also important to do so in a manner that is both fair and legally compliant.

There are a few reasons why landlords should consider increasing the rent on a regular basis:

To keep up with market demand: Landlords may increase the rent to keep up with the demand for rental properties in their area. If there is a high demand for rentals and not enough supply, landlords may be able to increase the rent to reflect this demand.
To cover the cost of inflation: Inflation is the general increase in prices of goods and services over time. Landlords may increase the rent to cover the cost of inflation, as the cost of maintaining and operating the rental property is likely to increase over time due to inflation.
To make a profit: Landlords are in the business of renting out their property to make a profit. They may increase the rent to increase their profit margin and make up for any costs associated with maintaining the property.

It's important to note that landlords are generally only allowed to increase the rent if the lease allows for it, and they must follow any applicable laws and regulations regarding rent increases.

Chicago

30 days notice if the tenant has occupied the apartment for up to six months
60 days notice if the tenant has occupied the apartment for more than six months and up to three years
120 days notice if the tenant has occcupied the apartment for more that 3 years

Cook County

The Cook County Rules apply to Cook County but NOT the following municipalities:

Chicago
Evanston
Mount Prospect

A landlord cannot require a tenant to renew a lease more than 60 days before the lease ends. While not specifically stated tenants should receive 30 days notice.

Housing Vouchers

When a tenant has a housing voucher keep the above guidelines in mind. Before asking tenant for increased rent you must contact the Housing Authority to discuss proposed increases in rent and the Hausing Authority must approve them.

3 Smoke Detectors

Illinois New Smoke Detector Rules

Beginning Jan. 1, 2023 the state's Smoke Detector Act will be changed to state that any smoke detectors must have a "self-contained, non-removable, long term battery."

The change was approved in 2017, but did not take effect until Jan. 1, 2023.

According to the Illinois Fire Safety Alliance, which worked with the General Assembly to pass the change, it applies to "residents that are still using alarms with removable batteries or alarms that are not hardwired."

There are a couple of exceptions, however.

According to the bill, the battery requirements do not apply to fire alarms, smoke detectors, smoke alarms, or other components "electronically connected to specified alarm systems," which use a low-power radio frequency wireless communication signal, Wi-Fi or any other wireless local networking capability.

The change also will not apply to "dwelling units and hotels within municipalities with a population over 1,000,000 inhabitants."

Smoke alarms in homes built after 1988 that have battery-powered detectors can leave them in until they exceed 10 years from their manufacturing date, unless they fail to respond to tests or malfunction, according to officials.

Those in violation of the law after Jan. 1, 2023 will have 90 days to change their smoke detectors or risk being assessed a fine of up to $100, which can be applied every 30 days until the violation if rectified, up to $1,500.

Obviously, you will now need to keep track of when new smoke detectors are installed.

We'd love to hear from you...

Let us know if this newsletter is helpful and/or how we can improve it. We'd love to hear what topics we should cover next month. Feedback to Five Star Realty

The general information that Five Star Realty Services LLC provides about landlord-tenant law is not intended as legal advice. Five Star Realty Services endeavors to provide accurate information, but the law is subject to change, and Five Star Realty Services is not a law firm or provider of legal services and makes no warranty regarding this information’s accuracy, completeness, reliability or usefulness. This information is for informational purposes only. Questions about your particular leasing situation should be directed to a lawyer.