Investor · Bronx, NY · Member since 2015 · 52 posts · 22 votes
I recieved a line of credit for 80 k looking to pick up a rental in Cleveland Ohio. Searching for a multi family in the price range of 15k to 35k. While putting the Brrr system to work on properties with only cosmetic rehab needed. Will be taking a trip down there on the 25th of June for two weeks. I'm in need of references to any realtors, electricians, plumbers, carpenters and property managers that may have already been vetted by the Bigger Pockets community.
I recieved a line of credit for 80 k looking to pick up a rental in Cleveland Ohio. Searching for a multi family in the price range of 15k to 35k. While putting the Brrr system to work on properties with only cosmetic rehab needed. Will be taking a trip down there on the 25th of June for two weeks. I'm in need of references to any realtors, electricians, plumbers, carpenters and property managers that may have already been vetted by the Bigger Pockets community.
Anything in that price range will require a considerable amount of rehab and be in a C more than likely D area.
In my opinion you would be better suited to purchase a property closer to that $80k price point. With where the market is now going under $35k for a Cleveland multi you are really just picking up unwanted scraps.
I recieved a line of credit for 80 k looking to pick up a rental in Cleveland Ohio. Searching for a multi family in the price range of 15k to 35k. While putting the Brrr system to work on properties with only cosmetic rehab needed. Will be taking a trip down there on the 25th of June for two weeks. I'm in need of references to any realtors, electricians, plumbers, carpenters and property managers that may have already been vetted by the Bigger Pockets community.
Anything in that price range will require a considerable amount of rehab and be in a C more than likely D area.
In my opinion you would be better suited to purchase a property closer to that $80k price point. With where the market is now going under $35k for a Cleveland multi you are really just picking up unwanted scraps.
I was told all this by a colleague and was curious if you could provide any insight on the topic. I was told some of the "multifamily" properties in the mid-west in general, are not actually multi's. They were SFH that have been converted in a sense to be a mock multifamily property (blocked off stairwells, added entry points, separated down the middle essentially). Is this true and do you come across these often? How do they get around the zoning laws? I assume its best to avoid these types of properties, if this is true.
Is there any other local info similar to this that an out of state investor should know?
I was told all this by a colleague and was curious if you could provide any insight on the topic. I was told some of the "multifamily" properties in the mid-west in general, are not actually multi's. They were SFH that have been converted in a sense to be a mock multifamily property (blocked off stairwells, added entry points, separated down the middle essentially). Is this true and do you come across these often? How do they get around the zoning laws? I assume its best to avoid these types of properties, if this is true.
Is there any other local info similar to this that an out of state investor should know?
Yes there are some properties that were once single homes that have been converted to duplexes long ago. We have many of them in our portfolio here at Holton-Wise.
Below is an example of a some of them.
The majority of these properties are actually zoned and recognized as multi family homes as they were converted back when the building and zoning codes were different. Conversions like the two above would not be allowed today.
The vast majority of the multi family homes in the Cleveland area were built to be multi family. They will look like this
Generally speaking the downstairs units of both types of homes will rent for the same amount but the upstairs units on the converted properties are all much smaller than the "true" duplexes and often times they do not have direct access to the basement which makes doing laundry less convenient for the upstairs tenant than an upstairs tenant in a "true" duplex.
Investor · Bronx, NY · Member since 2015 · 52 posts · 22 votes
9y
I can't help but think that you are coming from a brokers bias point of view here. Like how loan officers tell you too buy the most expensive property you can afford so as to cut them the biggest commission.
Investor · Bronx, NY · Member since 2015 · 52 posts · 22 votes
9y
Took a trip to Ohio, saw some properties in the Lorain, Ohio area with a realtor. Just met up with several contractors as well. Still need to link up with several property managers.
Specialist · Indianapolis, IN · Member since 2014 · 670 posts · 352 votes
9y
@Mandela Muhammad I can guarantee you that @James Wise is giving you solid advice, and I have nothing to gain from that remark. Buying any property in the midwest for $15K is going to put you in an undesirable asset class which are not appropriate investments for out of state investors. Those will be long term nightmares.
Investor · Bronx, NY · Member since 2015 · 52 posts · 22 votes
9y
@JeffWallenius yeah, Wise was right, I put my foot in my mouth, but 25 to 35k seems to be work for the multifamily duplexes. The main idea for me personally is to not pay 70k for a property that brings in 600 per month.
@James Wise
Is there still a good market or both cash flow and appreciation in the Cleveland market? Also, how are landlord/tenant laws in Ohio?
Yes, the market has one of the better rent to price ratio's in the nation.
As for appreciation if you look at those true duplexes I posted above they would sell for around $100k-$120k pre crash. The crash hit & we would scoup them up for $30k for awhile, then it hovered around the $50k's. Now those will run someone $75k-$80k. I believe they will probably get back to the $100k price point in the next year or so but that is an educated guess at best.
The Cleveland court system is pretty landlord friendly compared to extremely liberal pro tenant areas of the U.S. like California and Massachusetts. However the since the recent death of housing court Judge Raymond Pianka & the addition of interior rental inspections in the city of Cleveland it feels as though things are starting to turn a little left in the city of Cleveland. The suburbs are extremely landlord friendly though. Parma, Garfield, Lakewood etc....None of those areas give landlords a hard time.
New York, NY · Member since 2017 · 57 posts · 11 votes
9y
Mandela Muhammad hi I see you said your first out of state investment, so does that mean you have an investment in NYC. If so could I pick your brain about a few things?
@JeffWallenius yeah, Wise was right, I put my foot in my mouth, but 25 to 35k seems to be work for the multifamily duplexes. The main idea for me personally is to not pay 70k for a property that brings in 600 per month.
Usually am. Might be why my name is on hundreds of buildings here in #TheLand ; )
@James Wise those multifamily deals might be something I'm interested in.
Glad to see you have some interest in Cleveland Multi Family Chris. As this is not the marketplace forum let's just keep this conversation to information and strategy sharing only. If you have an interest in pursuing deals i'm sure you know how to find me.
At those price points, you're going to be in D or F caliber neighborhoods. There's nothing necessarily wrong with that, and some investors focus specifically on those markets, but they aren't for everyone. Feel free to send me a PM if you have questions about the Cleveland, Ohio area.
Investor · Bronx, NY · Member since 2015 · 52 posts · 22 votes
9y
So I ended up taking a trip down there the following weekend after we had the discussions here and ended up meeting with a realtor in the Lorain area. I made several offers and one got accepted; for an up down 2 family duplex. The asking price was 26,500 I through in my offer at 18k do to back taxes, and a broken sub pump that let water leak into the basement after it recently rained. I was countered at 22k, with the seller fixing back taxes and all little projects around the house. I accepted. Closing date is on the 26th of July. The unit is fully rented and brings in 450 from the top tenant and 550 from the bottom tenant whom has access to the basement for a total of 1000 a month. Of course in that 1100 we minus property management fee, property insurance, taxes, lawn care, etc. The address for the property is 1525 Reid Avenue, Lorain, OH 44052
Investor · Bronx, NY · Member since 2015 · 52 posts · 22 votes
9y
@Raina B. No I went to Jersey for my first investment property, found something within 30 minutes driving distance from my Bronx NY residence. I guess I really meant far out of state investment since I have no means to personally manage this one on my own. I would love to have you pick my brain.
Investor · Bronx, NY · Member since 2015 · 52 posts · 22 votes
9y
Yes @ShauneFaust on the flight back to NYC now. Closed on the 30th of August. I found a PM company, handy plumbers, carpenters and electricians. The seller evicted the tenants. This month I have scheduled appointments to replace carpet, water heater, add a gas meter. I plan to have second floor rented by end of September, 1st floor needs more work with finishes. Should be stabilized by October with 2 tenants, applications have already begun to come in.