Toledo, OH

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Toledo, OH

Shane MillerPro Member
New to Real Estate · Gilbert, AZ · Member since 2014 · 4 posts · 4 votes

We are new to real estate investing and are considering the Toledo, OH market. Does anyone know about how long it takes to rent in this market? We are looking at properties in the 43612 zip.

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Ryan Pyle
Multifamily Investor · Toledo, OH · Member since 2008 · 296 posts · 308 votes
12y

@Shane Miller

Rents should stay strong in this area. The housing stock is in better shape than the current rental-occupied areas because it is still in transition from owner-occ to renter-occ and therefore has not withstood tenant abuse yet.

I would focus on buying rentals in the Washington Local School district. There is very little rental stock there and very high demand. It is the "step-up" district from Toledo Public schools...not as good as the wealthier suburbs, but better than TPS, and taxes are still relatively low. The biggest thing to watch out for in WLS is flood plains. Don't buy anything that requires flood insurance because it will be very difficult to unload in the future.

You will pay more for houses in WLS...probably could be "all-in" for around $50k. A 3 bedroom will rent for at least $850 with tenant paying water (I bump the rent to $925 and I pay water). The tenant will have a good paying job and wages for you to garnish should they not pay. And you will have actual equity in the property, there will always be rental demand in the area, and it is way less likely to decline in price like 43612 will.

I speak from experience. I own about 40 houses in 43608 and 43605 zip codes. When I originally bought those houses I was selling flips in those areas for over $70k. I was all-in in my rentals for around $30k. I thought I had a ton of cushion. Guess what? As those areas turned from owner-occ to rental-occ prices fell quickly. Now those houses are worth $15k on a good day. Again, the same thing is happening in most of 43612.

With all that said, 43612 is OK in the Elmhurst Elementary school area. That should be OK for a while. But you will pay the same if not more that you would in WLS (because the homes are bigger in the Elmhurst hood) and the rents will be slightly lower and you have more risk of price decline down the road. I just don't see why you'd buy there.

Good luck.

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  • Adam A.
    Investor · Toledo, OH · Member since 2015 · 233 posts · 135 votes
    10y

    @Engelo Rumora I was at the hearing yesterday which went on for about 3.5 hours. The council will pass a law no doubt to protect children under 6 who are affected the most by lead poison. A testimony from an expert from the the University of Ohio based on assumption shows that about 3400 African-American children could be affected but not positively tested for lead poison. On the other hand, a city council noted that lest than 0.01% tested positive in Toledo.

    The HUD guidelines is to have less than 20 parts per million or billion (I'm not sure) of lead for children under 6. But CDC recommendation is below 10 and the city is 5 but advocacy groups asking 0.

    There was an article in the Toledo Blade newspaper recently about a case of a child lead poison and when the rental house was tested it was negative. It turned out the his grandparents owner occupant house where the problem existed as the kid was spending most of his time. 

    We all love children and want to shelter them. At the same time, this law is targeting landlords of SFH and duplexes of 1 and 2 units only. However, how about large apartment units and owner occupant homes built before 1978? Don't the children in these buildings count?

    I encourage everyone to attend the city council hearing as they want to our input and implement and adjust the ordinance before a final decision.      

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  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    10y
    Originally posted by @Adam A.:

    @Engelo Rumora I was at the hearing yesterday which went on for about 3.5 hours. The council will pass a law no doubt to protect children under 6 who are affected the most by lead poison. A testimony from an expert from the the University of Ohio based on assumption shows that about 3400 African-American children could be affected but not positively tested for lead poison. On the other hand, a city council noted that lest than 0.01% tested positive in Toledo.

    The HUD guidelines is to have less than 20 parts per million or billion (I'm not sure) of lead for children under 6. But CDC recommendation is below 10 and the city is 5 but advocacy groups asking 0.

    There was an article in the Toledo Blade newspaper recently about a case of a child lead poison and when the rental house was tested it was negative. It turned out the his grandparents owner occupant house where the problem existed as the kid was spending most of his time. 

    We all love children and want to shelter them. At the same time, this law is targeting landlords of SFH and duplexes of 1 and 2 units only. However, how about large apartment units and owner occupant homes built before 1978? Don't the children in these buildings count?

    I encourage everyone to attend the city council hearing as they want to our input and implement and adjust the ordinance before a final decision.      

    Thanks Adam, its a money pinch by the city and they are obviously scared to have the same criteria for anything above 2 units. Why do you think that is? They don't want to piss any of the the players in town with thousands of units as they would come crushing down on all of the decision makers.

    hehe

    All good mate, will just need to start a siding company :)

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  • Rob Badhorn
    Fix & Flip / Buy & Hold / Wholesaler · Toledo, OH · Member since 2016 · 99 posts · 33 votes
    10y

    Agree @Adam A. Seems to be targeting landlords is SFH unfairly. If we enact law it should be for everyone, not just Landlords as well. If we really want to rid the problem let it apply to every home owner, especially in the case of the kid at the grandparents.

    1Reply
  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    10y
    Originally posted by @Rob Badhorn:

    Agree @Adam A. Seems to be targeting landlords is SFH unfairly. If we enact law it should be for everyone, not just Landlords as well. If we really want to rid the problem let it apply to every home owner, especially in the case of the kid at the grandparents.

    They don't want to piss off the big players in town. Most if the guys with really heave pickets and big influence own large multifamily complexes.

    If the piss them off, they would bring some serious heat.

    Money speaks every language

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  • Rob Badhorn
    Fix & Flip / Buy & Hold / Wholesaler · Toledo, OH · Member since 2016 · 99 posts · 33 votes
    10y

    @Engelo Rumora  Agree!  And I agee with your Siding Company comment.  Anyone in?  lol 

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  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    10y
    Originally posted by @Rob Badhorn:

    @Engelo Rumora  Agree!  And I agee with your Siding Company comment.  Anyone in?  lol 

    Just read my comment, some ridiculous typo's haha

    Sorry about that

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  • Rob Badhorn
    Fix & Flip / Buy & Hold / Wholesaler · Toledo, OH · Member since 2016 · 99 posts · 33 votes
    10y

    No Worries!

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  • Adam A.
    Investor · Toledo, OH · Member since 2015 · 233 posts · 135 votes
    10y

    @Engelo Rumora I totally agree. 

    @Rob Badhorn Unfortunately, the advocacy groups and especially the majority of city council look at it as a landlord and racial injustice issue. What a shame that one of the city council had to mention something about it yesterday.

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  • Rob Badhorn
    Fix & Flip / Buy & Hold / Wholesaler · Toledo, OH · Member since 2016 · 99 posts · 33 votes
    10y

    WOW Adam, crazy to think being a landlord is somehow superior to anyone else.  We are just in business trying to make a buck for our family, no matter the race.

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  • Adam A.
    Investor · Toledo, OH · Member since 2015 · 233 posts · 135 votes
    10y

    @Rob Badhorn One of the city councils stated that landlords should know better that it's an investment. This ordinance is just like if the hot water breaks down and the landlord is responsible to fix it. Anna Mills, president of REIA response to his ignorant comment was perfect when shen said that according to HUD guideline disclosure lead base poisoning is also a result of bad house upkeep by the tenant.

     It's really important to attend those hearings and voice out any concerns. City councils don't have a clue except that landlords are harming children and that's how this snowball started in Rochester, NY 10 years ago.     

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  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    10y
    Originally posted by @Adam A.:

    @Rob Badhorn One of the city councils stated that landlords should know better that it's an investment. This ordinance is just like if the hot water breaks down and the landlord is responsible to fix it. Anna Mills, president of REIA response to his ignorant comment was perfect when shen said that according to HUD guideline disclosure lead base poisoning is also a result of bad house upkeep by the tenant.

     It's really important to attend those hearings and voice out any concerns. City councils don't have a clue except that landlords are harming children and that's how this snowball started in Rochester, NY 10 years ago.     

    I lost my A$$ when I first started investing in up state NYC. Particularly Rochester.

    Many inspectors there get paid off or turn a blind eye so they pass the property.

    I'll say it again, money speaks every language and its sometimes a sucky world we live in when such agenda's start popping up.

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  • Ryan Pyle
    Multifamily Investor · Toledo, OH · Member since 2008 · 296 posts · 308 votes
    10y

    Speaking of implementation of this law, I am curious as to how City Council plans to carry out the inspections required. According to cencus.gov, there are 117,785 occupied housing units in Toledo. About 88,520 of those are SFR and duplexes, which are the unit types that will be affected by this law. 87.7% of Toledo's housing stock was built before 1980 (couldn't drill down to 1978, so close enough), which leaves us with 77,632 pre-1980 housing units, of which 45.4%, or 35,245 should be renter-occupied. I would love to know how they plan on inspecting that many units. Let's say they give themselves 3 years. In a typical 247 day work year (let's give them 2 weeks vacation), they would have to inspect 47 units/day every day for 3 years to comply with the law. No way that's going to happen. That means 5 inspectors inspecting 1 unit per hour every work day...with no problems, sick days, no-shows, traffic jams or snow storms ever backing things up.

    3Reply
  • Adam A.
    Investor · Toledo, OH · Member since 2015 · 233 posts · 135 votes
    10y

    @Ryan Pyle I agree with you. They're in the process of hearing and taking in consideration all the obstacles including hiring a 3rd party for inspections. The panel which in favor of this ordinance which includes 2 attorneys at the hearing yesterday were playing adding new jobs to Toledo and economic growth cars!! The estimate is 45,000-55,000 affected rentals before 1979 that's not counting owner occupant.   

    The other alternative is to register all rentals at $45 each a year and have landlords voluntarily certified for free as lead inspectors by Federal grant. Then randomly inspect 10-15% of the rental units.  The problem is if the unit passes visually, 12 dust samples will be collected. If 50% of them failed, then the unit has to be corrected. Lead base dust could be found in the house due to toys made in China or contaminants from another owner occupant house. Exterior soil samples within 3 feet of the house has to be also collected and this could a contamination from emission being close to a highway. One of the issues is still to agree on is at what level lead is safe for children 5 or 0? 

    It's a huge and ugly can of worm that's going to affect the Toledo area economically for several years to come, if the ordinance passes without any compromise.     

    1Reply
  • Adam A.
    Investor · Toledo, OH · Member since 2015 · 233 posts · 135 votes
    10y

    @Engelo Rumora @Rob Badhorn @Fawaz Alkhaleefah @Ryan Phillips @Ryan Pyle 

     ALERT!! Here is the new DRAFT TOLED LEAD BASE LAW

    1Reply
  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    10y
    Originally posted by @Adam A.:

    @Engelo Rumora @Rob Badhorn @Fawaz Alkhaleefah @Ryan Phillips @Ryan Pyle 

     ALERT!! Here is the new DRAFT TOLED LEAD BASE LAW

    Whats this mate?

    I'm not much a reader and long stuff like this makes me cringe hehe

    Thanks

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  • Jim Moody
    SFR Investor · Toledo, OH · Member since 2011 · 33 posts · 17 votes
    10y

    Having attended the hearings yesterday, Anna Mills of the local REIA correctly pointed out to council that once a house is identified a having lead paint hazards, THE FEDERAL GUIDELINES will now become relevant. Want to know what that's like check it out on the web. Here's a quick snapshot of how investors may be affected.

    Wholesaler's...you can no longer sell a house to a investor who intends to rent without being certified lead free.

    Lenders...cannot give mortgages or loans on rental houses not certified lead free

    Rehabs/Flips...also will have negative impacts and those selling without thoughtful and complete disclosure will be sued for sure...starting with ABLE, then a cadre of contingency lawyers and so forth.

    I am available to talk privately to anyone concerned. Just send me a pm. Not doom and gloom predictions...just have to know

    2Reply
  • Phillip WeickertPro Member
    Investor · Cincinnati, OH · Member since 2013 · 23 posts · 12 votes
    10y

    Hey guys! I hope you all are doing well.  I am glad I was able to read this post.  It has been very insightful.  

    I am an investor in Cincinnati and own 7 SFR down here and plan to grow as rapid as possible. That being said I recently got a SFR under contract in Toledo and will close on July 8th with my Partner.

    The reason I invested in Toledo is due to my home town is near Toledo (Fremont).  In the next 5 years I plan to move back up that way and wanted to get a head start on the rental business up there.  

    I am curious is there a bigger pockets meetup in Toledo?  Have any of you attended before if so?  

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  • Adam A.
    Investor · Toledo, OH · Member since 2015 · 233 posts · 135 votes
    10y

    @Phillip Weickert - Hello Philip - I highly recommend the local Toledo REIA which meets the 2nd of Tuesday of Every month. Here is the link for more info: Local Toledo REIA.

    Also, @Engelo Rumora heads a local monthly Meetup for under 40 real estate investors which passed my prime :) ...  

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  • Engelo RumoraBusiness Member
    Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes
    10y
    Originally posted by @Adam A.:

    @Phillip Weickert - Hello Philip - I highly recommend the local Toledo REIA which meets the 2nd of Tuesday of Every month. Here is the link for more info: Local Toledo REIA.

    Also, @Engelo Rumora heads a local monthly Meetup for under 40 real estate investors which passed my prime :) ...  

    haha, We check for ID's at the front so look out.

    Ironic thing is I don't like young folks as they are all mostly spoiled brats :)

    Almost my entire staff is 40+ hehe

    Thanks mate

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  • Fawaz Alkhaleefah
    Qortuba , Kuwait city · Member since 2016 · 23 posts · 4 votes
    10y
    Question guys, usually.. Who's responsible for paying utilities in section 8 program? Landlords or tenants?
    1Reply
  • Eddie T.
    Rental Property Investor · NY · Member since 2013 · 844 posts · 350 votes
    10y

    @Fawaz Alkhaleefah It depends on how you write your lease. In my properties tenants pay all the utilities gas, electric and water. Except for multi family properties since i do not sub meter water their I pay for the water on those. Where are your properties located?

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  • Fawaz Alkhaleefah
    Qortuba , Kuwait city · Member since 2016 · 23 posts · 4 votes
    10y
    Eddie T. Multi family property in Toledo,, if I payed for water . Don't you think tenants might exceed their average?
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  • Eddie T.
    Rental Property Investor · NY · Member since 2013 · 844 posts · 350 votes
    10y

    Yes when the tenants are not responsible for paying the utilities on average yes they will use more. Now the water bill issue is market specific in some markets all tenants even the ones renting single family homes are not used to paying the water bill it may be that in that particular city the landlords do not bill for water and if you tried too you may have trouble filling your units. You have to get to know the market in which you invest to find out what is common practice.

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  • Adam A.
    Investor · Toledo, OH · Member since 2015 · 233 posts · 135 votes
    10y

     @Fawaz Alkhaleefah Personally, I can't even keep up with the local news about what's going in Toledo these days from the water to the lead paint crisis. If you are worried about the tenants over using water, you're in the wrong area of the county to invest my friend.  Toledo water bill might triple coming this September!!  Other towns buying water from Toledo now are studying to have their own water purification plant to lower cost. In this case, Toledo residents water bill will triple!!  In addition, the lead paint crisis will increase the rent - Section 8 will not compensate this huge and sudden jump. So, tighten your seatbelt it's going to be a bumpy ride until the clouds clear out.      

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  • Ryan Pyle
    Multifamily Investor · Toledo, OH · Member since 2008 · 296 posts · 308 votes
    10y

    @Fawaz Alkhaleefah, with Section 8 your lease determines who pays the utilities. HUD has allowances for each utility that you pay that you can build into the rent. The allowances can be found at www.lucasmha.org. For single family houses in Toledo it is typical that the tenant pays gas and electric. Each landlord differs as to how they handle water. I have found it better in the long run for me to pay water and build it into the rent. Sometimes the tenants use more than what I built in, sometimes they use less. But I don't have any issues collecting water bills. Ask most landlords who make tenants pay for water what their #1 headache is and they will most likely tell you, "collecting water bills."

    @Adam A., please point to where you found that Toledo water bills will triple. They have been climbing steadily since 2011, and are scheduled to continue to increase through 2018. However, I haven't seen anywhere that they will triple from where they are now. The last I saw they will go up "in 2016 and 2017 by 13.2 percent each year. In 2018, it is scheduled to jump another 4.5 percent," according to the Toledo Blade.

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