Out of State investor interested in Ohio

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Out of State investor interested in Ohio

Alaina Redfern
Rental Property Investor · Fairbanks, AK · Member since 2020 · 13 posts · 14 votes

Hey everyone, real estate investor from Alaska here. I’m interested in the buy and hold strategy, I own a couple rental properties here in state but I’ve been interested in Midwest due to low property costs. I’ve been doing my research and I’ve narrowed down my sights to Ohio, leaning towards Dayton or Cleveland areas (if there’s another, please throw it out there!). I do not have boots on the ground there and I’m interested in picking anyone’s brain about neighborhoods to avoid, along with rental rates as cash flow is the driver for me.

Any insight is greatly appreciated, thank you!

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Jeffrey Allen
Rental Property Investor · Cambridge, MA · Member since 2020 · 32 posts · 45 votes
5y

I invest in Columbus.  Columbus is the thriving growing city in Ohio.  The other major cities in Ohio are seeing population stagnation or decline.  Columbus, you can go after cash and appreciation.  You will certainly have to actively dig up good deals.  If you're looking for appreciation plays, in a number of areas you can throw a tennis ball from the street and hit a solid appreciation play (obviously appreciation is only a projection).

I think Cincinnati is a good market.  Recognize that there are some major industry declines happening.  Macy's and GE both are going through a very rough period and doing major layoffs.  Kroger which is also headquartered in Cincinnati will have to restructure as well with more online and delivery.  There is certainly money to be made there.

Dayton, make sure you get paid for the risk you're taking. There are some surrounding neighborhoods to the south of Dayton but kind of outside the greater Cincinnati ring that are solid.

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  • Marc RiceBusiness Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
    5y

    @Alaina Redfern

    Hi Alaina, glad you’ve focused on the midwest. Ohio is a great growing state with a strong economy that has some good markets. Whichever one you choose you’ll want to find a good core 4 - agent, lender, contractor, property manager.

    I personally invest in Columbus and am an agent here. The population and job growth has been great leading to a lot of rising rents and home values. There are a lot of good cash flow neighborhoods here that ALSO appreciate. Dayton, Cleveland, and Cincinnati tend to not appreciate anywhere near to Columbus because it’s decreasing population.

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  • Alaina Redfern
    OP
    Rental Property Investor · Fairbanks, AK · Member since 2020 · 13 posts · 14 votes
    5y

    @Marc Rice

    Thank you for throwing Columbus out there! I’ve also done some house hunting there as well, I wasn’t turned off of it by any means I just forgot to mention it in my post.

    As far as rentals, in your experience do you think you get a better cash return for a single family vs a duplex? I’ve noticed that most duplexes do not rent for the price of the single family (this is going off of realtor.com prices and rental rates so unsure of how accurate this statement is)

    1Reply
  • Michael Orlando
    Investor · Cleveland, OH · Member since 2019 · 147 posts · 156 votes
    5y

    @Alaina Redfern Hey Alaina! I'm in Cleveland and invest here currently with my partner. We buy 20+ unit apartment buildings. I'm happy to answer any questions you may have about Cleveland and share contacts as well in regards to realtors, contractors, inspectors, etc... Let me know what I can do to help and I'm happy to jump on a short call. We're always look to connect and work with Cleveland investors! 

    4Reply
  • Alaina Redfern
    OP
    Rental Property Investor · Fairbanks, AK · Member since 2020 · 13 posts · 14 votes
    5y

    @Michael Orlando

    That’s awesome, I hope to one day be on that level! I’m very interested in what knowledge you have to offer, I’m sending you a connection request. Thank you!

    1Reply
  • Andrew Weiner
    Property Manager · Cleveland, OH · Member since 2020 · 268 posts · 315 votes
    5y

    Although I am admittedly biased I like Cleveland over Dayton.  Dayton is (I believe) a secondary market, it will tend to be less resilient to economic uncertainty.  It does have a large Air Force base that might be an area to capitalize on.  
    In Cleveland there are some very good suburban rental areas.  I like to focus on the better school districts, I feel that they are a draw for better qualified tenants and will hopefully keep tenants in place longer.  The real money to be made or saved is when you buy.  I am seeing a lot of out of state investors buying properties that have good cash flow on paper but significant deferred maintenance.  Reading between the lines of a home inspection is super important since you aren’t on site to get the feel like when you buy locally.  I try to verbally ask my home inspector what his feeling is, he won’t write it down but he sees so many properties and usually has a gut feeling that I think is valuable.  

    5Reply
  • Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    5y
    Originally posted by @Alaina Redfern:

    Hey everyone, real estate investor from Alaska here. I’m interested in the buy and hold strategy, I own a couple rental properties here in state but I’ve been interested in Midwest due to low property costs. I’ve been doing my research and I’ve narrowed down my sights to Ohio, leaning towards Dayton or Cleveland areas (if there’s another, please throw it out there!). I do not have boots on the ground there and I’m interested in picking anyone’s brain about neighborhoods to avoid, along with rental rates as cash flow is the driver for me.

    Any insight is greatly appreciated, thank you!

     Definitely check out Columbus, Ohio. We have experienced  a rapid growth in jobs and population.

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  • Steven Foster Wilson
    Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes
    5y

    @Alaina Redfern Im just going to put this chart here and let you make the conclusion about where to invest in Ohio.

    1Reply
  • Brianne Leichliter
    Rental Property Investor · Cincinnati, OH · Member since 2019 · 59 posts · 77 votes
    5y

    @Alaina Redfern yay for Ohio!  I started out as an out of state investor myself and ultimately decided on Ohio.  You've selected some good potential cities within Ohio.  I personally invest in Cincinnati.  There's a lot of opportunity in Cincinnati and it's so close to both Kentucky and Indiana, so the options are limitless.

    I'd love to discuss my experience in Cincinnati more with you if you're interested!

    3Reply
  • Stephen Brown
    Real Estate Broker · Huntsville, AL · Member since 2019 · 1k+ posts · 872 votes
    5y

    Hello Alaina,

    I recommend you check out the Toledo market before you make your final decision on where to invest. We have a unique market in regards to jobs, schools, and most importantly our tenants. I've met people who've had the same tenant for... get this... 20 years. So it is very possible to do well in our market. Message me for more details.

    Thanks and good luck. I hope to visit your state of Alaska one day by the way. Looks Beautiful!

    2Reply
  • Zachary Elliott
    Real Estate Agent · Burlington, KY · Member since 2018 · 207 posts · 232 votes
    5y

    I wholeheartedly agree with @Brianne Leichliter. Greater Cincinnati is a fantastic market as well.

    2Reply
  • Rob Bergeron
    Real Estate Agent · Louisville, KY · Member since 2017 · 1k+ posts · 1k+ votes
    5y

    Tim Settles is an investor/agent that serves Dayton, Cinci, and Northern Kentucky. Would be a great  resource.

    1Reply
  • Shane Cloutier
    New to Real Estate · Dalton, NH · Member since 2020 · 116 posts · 64 votes
    5y

    Thank you everyone for all the great information and contacts for Ohio investing.  My wife and I are also long distance investing in Ohio and this is greatly appreciated. 

    1Reply
  • Jeffrey Allen
    Rental Property Investor · Cambridge, MA · Member since 2020 · 32 posts · 45 votes
    5y

    I invest in Columbus.  Columbus is the thriving growing city in Ohio.  The other major cities in Ohio are seeing population stagnation or decline.  Columbus, you can go after cash and appreciation.  You will certainly have to actively dig up good deals.  If you're looking for appreciation plays, in a number of areas you can throw a tennis ball from the street and hit a solid appreciation play (obviously appreciation is only a projection).

    I think Cincinnati is a good market.  Recognize that there are some major industry declines happening.  Macy's and GE both are going through a very rough period and doing major layoffs.  Kroger which is also headquartered in Cincinnati will have to restructure as well with more online and delivery.  There is certainly money to be made there.

    Dayton, make sure you get paid for the risk you're taking. There are some surrounding neighborhoods to the south of Dayton but kind of outside the greater Cincinnati ring that are solid.

    5Reply
  • Marlen Weber
    Specialist · Plano, TX · Member since 2020 · 2k+ posts · 861 votes
    5y

    Hi @Alaina Redfern. Welcome to BiggerPockets. Best of luck on your future buy and hold investments. 

    2Reply
  • Alaina Redfern
    OP
    Rental Property Investor · Fairbanks, AK · Member since 2020 · 13 posts · 14 votes
    5y

    @Andrew Weiner

    That’s great advise! And makes complete sense about Cleveland vs Dayton. I’m not from Ohio nor am I familiar with the area but I keep hearing the same thing about avoiding Dayton. Thank you for your insight

    0Reply
  • Alaina Redfern
    OP
    Rental Property Investor · Fairbanks, AK · Member since 2020 · 13 posts · 14 votes
    5y

    @Brianne Leichliter

    I’m not dead set on an area and would love to discuss Cincinnati, thank you!

    2Reply
  • Alaina Redfern
    OP
    Rental Property Investor · Fairbanks, AK · Member since 2020 · 13 posts · 14 votes
    5y

    @Stephen Brown

    Hey Stephen, thank you for pointing out Toledo. That’s very interesting and intriguing about having the same tenant for so long. That’s similar to how the rental market is in Alaska.

    If you come visit make sure it’s in the summer unless you just really want to experience some cold weather :)

    3Reply
  • Alaina Redfern
    OP
    Rental Property Investor · Fairbanks, AK · Member since 2020 · 13 posts · 14 votes
    5y

    @Jeffrey Allen

    I appreciate your insights! I’m not sure how I left Columbus off of my list but at this point it’s definitely on and I think I’ve heard enough negative about Dayton to scratch that one off. Thank you for taking the time to respond, much appreciated!

    0Reply
  • Brandon SturgillBusiness Member
    Real Estate Broker · Columbus, OH · Member since 2013 · 3k+ posts · 1k+ votes
    5y

    @Alaina Redfern I've seen a lot of folks in your position...you can find great deals anywhere in Ohio...you can find great deals anywhere in the country...but if you do decide on Ohio, it has to be a location you are comfortable with. The 3-C's (Cleveland, Columbus, and Cincinnati) all have amazing opportunity. If you stick to any of these metro markets you can find killer agents and property managers with a bit of homework.

    That said, I vote for Dayton...it is a true underdog of a city we are all pulling for ;) 

    Best of luck in your search.

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  • Uri Gofman
    Member since 2018 · 150 posts · 200 votes
    5y

    We've been successfuly investing in Cleveland since 1995.  Cleveland is a great market for cash flow.  As is the case everywhere, there are better and worse neighborhoods for investment.  I always advise all of our clients / partners to not look at potential cash flow in a vacuum.  Remember that projected income and actual income can be very different.  If your cash flow is a function of your tenant's job security and they have life cirumstances that prevent them from maintaining constant employment, you will likely not get paid.  This can happen in month 1, month 6, or month 12 of their tenancy.  While it's difficult to predict as to exactly when their problems will spill over into becoming your problem, it's fairly easy to predict that it will occur.  Focusing on working class neighborhoods with, ideally, multiple income families (2 working spouses / roommates / etc) is one way to mitigate this concern.  The good news is that the Cleveland market has many great investment areas that can satisfy that requirement.  The bad news is that those areas are not going to be the lowest priced areas within the market.  

    4Reply
  • Ari Hadar
    Investor · Member since 2020 · 401 posts · 86 votes
    5y
    Originally posted by @Brandon Sturgill:

    @Alaina Redfern I've seen a lot of folks in your position...you can find great deals anywhere in Ohio...you can find great deals anywhere in the country...but if you do decide on Ohio, it has to be a location you are comfortable with. The 3-C's (Cleveland, Columbus, and Cincinnati) all have amazing opportunity. If you stick to any of these metro markets you can find killer agents and property managers with a bit of homework.

    That said, I vote for Dayton...it is a true underdog of a city we are all pulling for ;) 

    Best of luck in your search.

     I actually find it hard to find fixer upper in Cleveland according to the 70% for brrr with 65% 6% refinance loan

    0Reply
  • Account Closed
    New York NY/Columbia County, NY · Member since 2020 · 19 posts · 5 votes
    5y

    @Marc Rice Hi Mark, I’m also interested in remote properties to brrrr. Am looking for a cash buy for first one, with a reliable lender and appraiser, property managers, rehabber, etc. Would be interested in any ideas you have. I’m in NY.

    0Reply
  • Marc RiceBusiness Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
    5y

    @Alaina Redfern

    If you need any help learning about Columbus or getting connected local I’m happy to help.

    In regards to cash flow, it depends. You’ll have less capex/vacancy per a property with a duplex but single families can rent a little bit of a surcharge. I think you can find instances of each frankly - except in A/B class neighborhoods I believe that multi family will cash flow better. I personally like multi family and invest in that myself.

    [email protected]614-363-2787
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  • Marc RiceBusiness Member
    Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
    5y

    @Paul Paleologos

    Happy to connect you with local resources in Columbus and help you better understand the market. Columbus is great for cash flow and appreciation. I personally like small multi family here and that’s what I’m currently investing in. Shoot me a message if you ever want to connect.

    [email protected]614-363-2787
    Marc Rice | Investor Friendly Agent at Reafco Tailwind Team574 Reviews
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  • Jennifer Escobar
    Member since 2021 · 20 posts · 19 votes
    5y

    I know you mentioned Ohio but San Antonio, TX is a great place to buy right now. Cheaper than Austin and homes definitely appreciating. I lived in Anchorage for 3 years and know AK can get pricey!

    2Reply
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