[bacon]

I rent out an apartment I own so here are a few considerations as you run the numbers. Firstly, you will pay 5 percent or more of the sale value when you buy and sell it. You will have tenants leave the place, this will require cleanups (repainting walls, deep clean floors). When your apartment is vacant, which will happen unless you get a tenant who never moves out, you won't get income but will still have reoccurring expenses during that period. You will need to factor in scheduled maintenance for ac/heating units unless your HOA covers that, also general repairs inside the unit of broken appliances. Do you want to manage it yourself? If you want it to be purely passive you will have to pay a company to manage the property for you (this makes collecting rent, dealing with maintenance and finding tenants easy for you) but you gotta pay them their fees which can be hundreds of dollars a month. What happens if in a liberal city like Chicago they decide to drastically raise property taxes after you buy it, how would that eat into your revenue?

Personally, unless you are buying near a bottom of a market or you have professional experience in the real estate market that helps you get good deals on property its a tough call to know what you can expect in property appreciation. Right now, you don't really have much of an edge as a regular guy buying into a US housing market that has already grown substantially in the last few years.

One option might be to buy a quality REIT that has a good yield, and you could even diversify by buying half a dozen quality ones. Also, you could buy a REIT ETF which gives you immense diversification by holding dozens of REITs within the ETF and it would also have a decent yield. Most REITS have been down slightly for the year so this is not a overvalued area of the stock market.