Need help to chose area to invest in Cleveland

13 Replies

Hey all,

I need the best area to invest for rent in Clevelnad.

Any agents or someone who invest there?

TNX

Originally posted by @Roy Ben :

Hey all,

I need the best area to invest for rent in Clevelnad.

Any agents or someone who invest there?

TNX

What are you looking for? "Best" can depend on the person and the strategy. Are you looking for flips, buy and holds, etc? You can find some very low-cost properties to flip all over, but they may end up being in bad neighborhoods that will give you a difficult time finding a good tenant or for resale. If you are looking for a buy and hold, I would recommend looking more into the suburbs like Euclid, Bedford, Cleveland Heights, Lakewood, Parma Heights, Willowick, Eastlake, Wickliffe, and Mentor. 

If you are feeling risky and are trying to be dangerous with "up and coming" area, maybe look into Ohio City and University Circle. 

Feel free to send me a PM, I would be happy to help. Good luck to you!

Originally posted by @Tom Ott :
Originally posted by @Roy Ben:

Hey all,

I need the best area to invest for rent in Clevelnad.

Any agents or someone who invest there?

TNX

What are you looking for? "Best" can depend on the person and the strategy. Are you looking for flips, buy and holds, etc? You can find some very low-cost properties to flip all over, but they may end up being in bad neighborhoods that will give you a difficult time finding a good tenant or for resale. If you are looking for a buy and hold, I would recommend looking more into the suburbs like Euclid, Bedford, Cleveland Heights, Lakewood, Parma Heights, Willowick, Eastlake, Wickliffe, and Mentor. 

If you are feeling risky and are trying to be dangerous with "up and coming" area, maybe look into Ohio City and University Circle. 

Feel free to send me a PM, I would be happy to help. Good luck to you!

 
I'm looking for buy & hold,

Sent you private message.
TNX

Every investor has their own niche that they like.  Some like suburbs, which have nicer houses and potentially better tenants, but higher taxes and higher property costs.   Others like lower class or middle class parts of the city, where properties are less expensive, taxes are lower, but there may be higher turn over, and more evictions.  Others like something in between.  What area are you most comfortable with?  IMO, the best areas to invest has demographics that you're familiar and comfortable with.  That will give you the best sense of the market, and your customers (tenants).

@Roy Ben Welcome to BP! and Maybe welcome to Cleveland!

I invest there, that is a very open ended question. 

there is good and bad about every area. 

I do some burbs, and some inner city. 

Its all good with the right buy!

I know my answer was weak, but  best I can do without knowing your goals. 

Hope to see ya in my town soon!

@Tom Ott I'm interested in investing in the Cleveland area, too. I read your post. Jumped on realtor, Wikipedia and street view. Can't really call that research, I know. One thing I realized within the past half an hour, is that the first few neighborhoods you mentioned appear to be some low income, lower class c/ f areas that have been declining for years. Cheap houses, high poverty, higher crime. On the other hand the neighborhoods you mentioned towards the end of your post appear as if they would be of interest to an investor looking for minimum problems. My point? None, really. Just wanted to throw it out there for everybody to see how easy it is to get a general idea about a few neighborhoods just by looking at some numbers and statistics. It's good when experienced investors like you post specific neighborhoods here. It gives us, the new guys who don't know the area at all, the starting point.
Originally posted by @Jake Recz :
@Tom Ott I'm interested in investing in the Cleveland area, too. I read your post. Jumped on realtor, Wikipedia and street view. Can't really call that research, I know. One thing I realized within the past half an hour, is that the first few neighborhoods you mentioned appear to be some low income, lower class c/ f areas that have been declining for years. Cheap houses, high poverty, higher crime. On the other hand the neighborhoods you mentioned towards the end of your post appear as if they would be of interest to an investor looking for minimum problems. My point? None, really. Just wanted to throw it out there for everybody to see how easy it is to get a general idea about a few neighborhoods just by looking at some numbers and statistics. It's good when experienced investors like you post specific neighborhoods here. It gives us, the new guys who don't know the area at all, the starting point.

 Well, it's easy to get an idea just by looking at numbers and statistics, but I'm not sure it's the most accurate idea. C/F areas? That's a pretty big difference... and I wouldn't put Euclid, Bedford or Cleveland Heights anywhere near F. You're making them sound like war zones. :)

I'm working with a few out of state investors right now and we were recently going over an MLS listing for a multifamily property right near the big Cleveland Clinic campus by University Circle. 4 units listed for under $100k, but not by much. One of the investors pointed out the "nearby sold properties" on the bottom of the page, and asked why they were so cheap - 10k, 14k, 8k. Because they're nearby, but they're in a warzone. That zip code covers the revitalizing area we were looking at, part of the East Cleveland warzone, and one of the richest neighborhoods in Cleveland, Bratenahl. If you're looking at data which is breaking things down by town or zip code, you're going to struggle to get that kind of granularity.

Also keep in mind that the last time the Google truck was through here was 2014. I use streetview all the time too, but you really want to drive those streets yourself. I recently went by one in Garfield Heights (which varies hugely from block to block) which looked great on Streetview, but I decided not to get out of the car for photos when I was actually there.

Come on out to visit, get yourself some boots on the ground, or both. :)

Thanks all for your answers.
I'm looking to buy & hold for rent

my budget is around 50k

And I'm still confused about what is the best area for me.

Originally posted by @Roy Ben :

Hey all,

I need the best area to invest for rent in Clevelnad.

Any agents or someone who invest there?

TNX

 Best can be a loaded question. How do you define best? I think that will vary by person & strategy. Personally I think B neighborhoods & up are where you want to be. Many investors (especially here on BP gravitate towards the C neighborhoods due to the perception that they will receive more cash flow.

My opinion on a B neighborhood vs a C neighborhood is that in a C neighborhood you will have periods of time where you do make much more cash flow on your C neighborhood properties then you do with your B neighborhood properties but there will also be more times where you need to put money back into your C neighborhood properties than your B neighborhood properties. B-Class cash flow is more of a consistent slow rolling hill. C-Class is more peaks and valleys.

@Roy Ben

It depends on your risk tolerance and your goals. Different approaches can work. Aside from price range, what sort of neighborhood or asset class are you looking to invest in? 

Originally posted by @Timothy Murphy III :

@Roy Ben

It depends on your risk tolerance and your goals. Different approaches can work. Aside from price range, what sort of neighborhood or asset class are you looking to invest in? 

 I'm new in investing so I still don't know the differences between classes.
What I do know is that I don't want rough neighborhood.

Price range: around 50K

I'm looking to invest in single family house, buy & hold

Most investors use a letter grade rating scale from A-F to describe various areas and neighborhoods. Keep in mind these are subjective, so they're meaningless without calibrating your scale.

A fairly typical letter grading scale for the NE Ohio area would be something like this.

A - Higher end and expensive areas. Mostly owner occupied homes and those that do rent are typically higher income earning professionals.

B - Stable suburban areas. Working class to upper middle type tenants.

C - Better areas within city limits or lower end parts of inner ring suburbs. Mostly working class.

D - Inner city areas. Tenant base tends to be low income. Lots of public assistance, social Security and disability income.

F - Warzones.

The higher on the scale you go, the less risky your investment will be, but the cash flow lower returns. Higher end areas tend to do better for appreciation as well. Lower end areas have additional risks and challenges but also have the potential for much higher cash flow, as the acquisition prices are dramatically cheaper but the monthly rents aren't proportionally cheaper. In my experience, most investors tend to target B or C caliber areas in effort to strike a decent balance between risk, cash flow, and potential future appreciation, but there are investors that operate in each of these asset classes.

I live in Wickliffe. Our city is struggling with keeping business in the city. We just lost ABB and the company will be leaving the city shortly. That leaves only one major business in the city, Lubrizol. The city is considering raising city tax to cover, however, this tax discussion did not include folks from Lubrizol and so now the fear is Lubrizol might leave the city if and when the raise of city tax goes into effect.  We currently have 3 schools, elementary, middle, and high school but the elementary school will be closed next year and the students will be divided between the middle and high schools. The reason being, that there just isn't enough money to repair the school building. We have two "hotels" in the city that host the borderline homeless/drug activity which "feels" like it has been increasing. You'll have to do your own research. We have an election coming up with new folks that have plans to help change the way things are heading....but time will tell. 

I have a rental in Mentor and I would invest in that city again. Every store/business imaginable seems to exist in Mentor. The city appears to be strong and vibrant. There are plenty of activities and events going on all the time. It is personally where I am considering moving to once my Junior in high school graduates from Wickliffe. 

My personal preference would be to start looking in this order:  Mentor, Eastlake, Willowick, Lakewood, Wickliffe, Euclid.....The other cities I don't know so I can't rank. 

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