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Understanding the Chicago Residential Tenant and the Cook County Tenant Landlord Ordinances


In Chicago, a multi-unit property owner must remain compliant with the proper notice given to tenants when they wish to terminate a lease.


These timelines are mandated by the Chicago Residential Tenant Ordinance and Cook County Tenant Landlord Ordinance. The laws protect tenants from being evicted without enough notice to find a new home.


However, when selling or buying multi-unit properties, these ordinances can impact new owners who plan to terminate leases to use their property in the manner they desire.

Therefore, brokers should understand these ordinances to ensure they don’t interfere with their client's plans.


How Timing is Determined


Based on the Chicago Fair Housing Ordinance, the timelines to either move to terminate a lease or raise rent are based on how long the tenant has lived in the unit:

  • For a tenancy of under 6 months, notice must be at least 30 days before the end of the term of the tenancy.

  • For a tenancy of 6 months to 3 years, notice must be 60 days before the end of the term. Failure to give proper notice allows the tenant to remain 90 days.

  • 120 days are required for those living in the rental units for more than three years. Failure to give property notice allows the tenant to stay at the rent amount at the time of notice for an additional 120 days.

These rules apply to both written year-long leases and informal month-to-month leases. They not only apply to timing to terminate a lease or raise rent but also to any changes to the terms of a lease. If a tenancy changes from an annual term to a month-to-month tenancy, the count to determine the amount of days for which they are entitled to notice starts with the original lease date.


Why Brokers Should Understand Timing Ordinances


Brokers should understand the terms for each unit when helping their clients buy multi-unit properties.


The terms of a lease can change the value of the property because the leases can vary from unit to unit. For example, there could be a new tenant paying $2,500 per month, while someone who has lived there for 30 years is only paying $750 because they’ve been grandfathered in.


Also, because it can take months to make changes to existing leases, and sales tend to occur within 30 to 45 days, the buyer could be out-of-pocket for as long as three months. Therefore, in the case where there are multiple tenants, the buyer needs to know how the notice times impact their rental income. They could have all tenants living there over three years which means they are looking at 120 days before they can make changes on whether they want to terminate leases or raise the rent.


Other Tenant Factors to Consider


Your client also wants to know they can charge a reasonable rent that will both cover their costs and attract tenants.


Often the ideal scenario for a new landlord is to simply take over the role without having to make too many changes to the leases, levels of rent, renovations, etc. Finding a multi-unit property with good tenants paying a fair rent is a far easier prospect than buying a property with either empty units, units with long-term tenants requiring three months’ notice for termination, or with low rental rates in an area where far higher rents could be charged.

It seems that the only constant is change as ordinances affecting real estate in Chicagoland go. Understanding their machinations helps both parties.



The Minchella & Associates Difference


With over 40 years of experience in Illinois real estate law, Erica Minchella has represented thousands of home sellers and buyers, landlords and commercial and investment property owners. For more information, schedule a consultation today.

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