Best markets for 2-4plexes with mid - high ROI

Multi-Family and Apartment Investing
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Best markets for 2-4plexes with mid - high ROI

Obehi Moore
Rental Property Investor · Bay Area, CA · Member since 2022 · 10 posts · 8 votes

Hello, I am looking to invest in duplex - fourplexes. Florida has been my preferred state up until now but I'm having a hard time finding good investments at a decent price point that yield mid to high ROI cashflow-wise. Can anyone recommend state/city/neighborhoods. Targeted price point is preferable under $500k. Thank you!

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Scott AllenBusiness Member
Real Estate Agent · Columbus, OH · Member since 2020 · 449 posts · 471 votes
4y

@Obehi Moore You can definitely find a good multi-family investment in Columbus, OH under that price point. Feel free to connect if you'd like to learn more!


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  • Obehi Moore
    OP
    Rental Property Investor · Bay Area, CA · Member since 2022 · 10 posts · 8 votes
    4y

    I'm very interested in the Midwest and would love to connect with people in those spaces (NC, OH, TN, TX). 

    1Reply
  • Matthew Tregoning
    Real Estate Consultant · Melbourne, FL · Member since 2019 · 205 posts · 113 votes
    4y

    Hey Obehi!

    I'm seeing massive success with my duplex as a mid-term rental in the Space Coast. Have you considered marketing towards travel nurses?

    2Reply
  • Scott AllenBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2020 · 449 posts · 471 votes
    4y

    @Obehi Moore You can definitely find a good multi-family investment in Columbus, OH under that price point. Feel free to connect if you'd like to learn more!


    [email protected]614-698-1227
    Reafco - Columbus, OH
    WebsiteView Page
    3Reply
  • Muhammad Amawi
    Investor · Cleveland · Member since 2022 · 131 posts · 115 votes
    4y

    Hey Obehi,

    Cleveland is an amazing market for multifamily properties that are almost all going to be under your price point with great cash flow opportunity. I typically recommend the westside of Cleveland; Ohio city, Tremont, west park, Lakewood, Edgewater and Brooklyn are all great places to start your search.

    I'm very well connected to local real estate agents, title and pmc here that would all make it a great smooth sailing process for yourself.

    Looking forward to connecting with you!

    3Reply
  • Patrick DruryBusiness Member
    Real Estate Agent · Columbus, OH & Cleveland OH · Member since 2021 · 1k+ posts · 2k+ votes
    4y

    @Obehi Moore
    Columbus OH has a good amount of Small multi-family under 500k. 

    [email protected]614-412-4565
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    2Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    4y
    Quote from @Obehi Moore:

    Hello, I am looking to invest in duplex - fourplexes. Florida has been my preferred state up until now but I'm having a hard time finding good investments at a decent price point that yield mid to high ROI cashflow-wise. Can anyone recommend state/city/neighborhoods. Targeted price point is preferable under $500k. Thank you!


     You can get small multi under $500k in most of the USA. What type of price point are you looking for? For example in Cleveland you only need about $120k to get a solid duplex. Are you aiming for that low or do you want to be much closer to the $500k price point?

    0Reply
  • Obehi Moore
    OP
    Rental Property Investor · Bay Area, CA · Member since 2022 · 10 posts · 8 votes
    4y
    Quote from @James Wise:
    Quote from @Obehi Moore:

    Hello, I am looking to invest in duplex - fourplexes. Florida has been my preferred state up until now but I'm having a hard time finding good investments at a decent price point that yield mid to high ROI cashflow-wise. Can anyone recommend state/city/neighborhoods. Targeted price point is preferable under $500k. Thank you!


     You can get small multi under $500k in most of the USA. What type of price point are you looking for? For example in Cleveland you only need about $120k to get a solid duplex. Are you aiming for that low or do you want to be much closer to the $500k price point?


     @James wise, I'm looking to get 2-3 properties for that price. So $120k would be ideal for what my goal is! 

    0Reply
  • Obehi Moore
    OP
    Rental Property Investor · Bay Area, CA · Member since 2022 · 10 posts · 8 votes
    4y
    Quote from @Muhammad Amawi:

    Hey Obehi,

    Cleveland is an amazing market for multifamily properties that are almost all going to be under your price point with great cash flow opportunity. I typically recommend the westside of Cleveland; Ohio city, Tremont, west park, Lakewood, Edgewater and Brooklyn are all great places to start your search.

    I'm very well connected to local real estate agents, title and pmc here that would all make it a great smooth sailing process for yourself.

    Looking forward to connecting with you!


     Thanks Mohammad! That's very insightful. I would love to know more about these areas you mentioned. I don't know anything about Ohio rental market. 

    1Reply
  • Obehi Moore
    OP
    Rental Property Investor · Bay Area, CA · Member since 2022 · 10 posts · 8 votes
    4y
    Quote from @Matthew Tregoning:

    Hey Obehi!

    I'm seeing massive success with my duplex as a mid-term rental in the Space Coast. Have you considered marketing towards travel nurses?


     Hi Mathew,  I hadn't ventured that far. My focus had been the gulf (Tampa, St. Pete, Bradenton, Clearwater  etc) and SFL. Would like to learn more about the coast. 

    0Reply
  • Bob S.
    Real Estate Consultant · Cleveland · Member since 2020 · 6k+ posts · 3k+ votes
    4y

    Florida is NOT where you are going to make a ROI on your rental. Cleveland is and has been the number one rental market for 10 years or so. 10% net caps are to be had ( bases on cash purchases ) 100% hands off . Its all about your team and knowledge,

    BTW  I have seen 10 units for under 500k with about 55k NET income,,, 

    good luck 

    0Reply
  • Obehi Moore
    OP
    Rental Property Investor · Bay Area, CA · Member since 2022 · 10 posts · 8 votes
    4y
    Quote from @Obehi Moore:

    I'm very interested in the Midwest and would love to connect with people in those spaces (NC, OH, TN, TX). 


     And Detroit, MI. 

    0Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    4y
    Quote from @Obehi Moore:
    Quote from @James Wise:
    Quote from @Obehi Moore:

    Hello, I am looking to invest in duplex - fourplexes. Florida has been my preferred state up until now but I'm having a hard time finding good investments at a decent price point that yield mid to high ROI cashflow-wise. Can anyone recommend state/city/neighborhoods. Targeted price point is preferable under $500k. Thank you!


     You can get small multi under $500k in most of the USA. What type of price point are you looking for? For example in Cleveland you only need about $120k to get a solid duplex. Are you aiming for that low or do you want to be much closer to the $500k price point?


     @James wise, I'm looking to get 2-3 properties for that price. So $120k would be ideal for what my goal is! 


     Well if you decide to dive further into properties like these you'll want to read The Ultimate Guide to Grading Cleveland Neighborhoods. Not every $120k duplex in the Cleveland area is the same. Very important you know what's what. It's a very tricky market.

    0Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    4y

    @Obehi Moore

    We think the Midwest is a GREAT place for OOS investors to consider!

    YES, we may be a little biased, but check out our blog here on BP comparing Detroit to other cities and Deep Dives on Metro Detroit cities & neighborhoods: https://www.biggerpockets.com/...

    Your biggest question shouldn't be WHERE to invest, but HOW you will invest!

    Many OOS investors set themselves up for failure because they don't truly take the time to understand:

    1) The Class of the NEIGHBORHOOD they are buying in - which is relative to the overall area.

    2) The Class of the PROPERTY they are buying - which is relative to the overall area.

    3) The Class of the TENANT POOL the Neighborhood & Property will attract - which is relative to the overall area.

    4) The Class of the CONTRACTORS that will work on their Property, given the Neighborhood location - which is relative to the overall area.

    5) The Class of the PROPERTY MANAGEMENT COMPANIES (PMC) that will manage their Property, given the Neighborhood location and the Tenants it will attract - which is relative to the overall area.

    6) That a Class X NEIGHBORHOOD will have mostly Class X PROPERTIES, which will only attract Class X TENANTS, CONTRACTORS AND PMCs and deliver Class X RESULTS.

    7) That OOS property Class rankings are often different than the Class ranking of the local market they live.

    8) Class A is relatively easy to manage, can even be DIY remote managed from another state. Can usually allot 5-10% vacancy factor and same for maintenance.

    9) Class B usually also okay, but needs more attention from owner and/or PMC. Vacancy and maintenance factors should be higher than for Class A as homes will be older, have more deferred maintenance and tenants will be harder on them.

    10) Class C can be relatively successful with a great PMC (do NOT hire the cheapest!), but very difficult to DIY remote manage. Vacancy and maintenance factors should be higher than for Class A or B. Homes will have even more deferred maintenance and tenants will be even harder on them.

    11) Class D pretty much requires an OWNER to be on location and at the property 3-4 times/week. Most quality PMCs will not manage these properties as they understand most owners won’t pay them enough for the time required and even then it’s too difficult successfully manage them.
    ***Only exception is if an owner has plan & funds to reposition Class D to Class C or higher.

    https://www.biggerpockets.com/forums/776/topics/960183-what-they-dont-tell-you-about-cheap-rental-properties?highlight_post=5562799&page=3#p5562799

    Also, SERIOUSLY consider - do you really have the time to be a DIY landlord or should you hire a PMC?

    [email protected]248-209-6824
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    0Reply
  • Joe HammelBusiness Member
    Real Estate Agent · Metro Detroit, MI · Member since 2018 · 612 posts · 666 votes
    4y

    @Obehi Moore

    Metro Detroit

    Price: $125-$350k

    Deals beat the 1% rule and solid location and run about 10-14% ROI - just depends

    B, C+ Markets

    [email protected]248-422-1685
    FIRE Realty Team - Keller Williams5377 Reviews
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    1Reply
  • Nicholas DeCespedes
    Real Estate Agent · Orlando FL, USA · Member since 2019 · 29 posts · 28 votes
    4y

    I am in the Orlando Area. I will be on the lookout for you and see what is available in my area.

    1Reply
  • Tyler GibsonBusiness Member
    Real Estate Agent · Orlando, FL · Member since 2017 · 1k+ posts · 2k+ votes
    4y
    Quote from @Obehi Moore:

    Hello, I am looking to invest in duplex - fourplexes. Florida has been my preferred state up until now but I'm having a hard time finding good investments at a decent price point that yield mid to high ROI cashflow-wise. Can anyone recommend state/city/neighborhoods. Targeted price point is preferable under $500k. Thank you!


    What is your ROI Target range? Stating mid to high is still left up to interpretation and I don't like guessing.

    [email protected]407-590-9858
    GPG Team 596 Reviews
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    1Reply
  • Obehi Moore
    OP
    Rental Property Investor · Bay Area, CA · Member since 2022 · 10 posts · 8 votes
    4y
    Quote from @Joe Hammel:

    @Obehi Moore

    Metro Detroit

    Price: $125-$350k

    Deals beat the 1% rule and solid location and run about 10-14% ROI - just depends

    B, C+ Markets


    Hi Joe, this is great intel, thank you! I'm definitely interested in B Markets considering the ROI in looking at (your range is precisely my target).

    1Reply
  • Obehi Moore
    OP
    Rental Property Investor · Bay Area, CA · Member since 2022 · 10 posts · 8 votes
    4y
    Quote from @Tyler Gibson:
    Quote from @Obehi Moore:

    Hello, I am looking to invest in duplex - fourplexes. Florida has been my preferred state up until now but I'm having a hard time finding good investments at a decent price point that yield mid to high ROI cashflow-wise. Can anyone recommend state/city/neighborhoods. Targeted price point is preferable under $500k. Thank you!


    What is your ROI Target range? Stating mid to high is still left up to interpretation and I don't like guessing.


     10-15% minimum. Hope that helps

    0Reply
  • Tyler GibsonBusiness Member
    Real Estate Agent · Orlando, FL · Member since 2017 · 1k+ posts · 2k+ votes
    4y
    Quote from @Obehi Moore:
    Quote from @Tyler Gibson:
    Quote from @Obehi Moore:

    Hello, I am looking to invest in duplex - fourplexes. Florida has been my preferred state up until now but I'm having a hard time finding good investments at a decent price point that yield mid to high ROI cashflow-wise. Can anyone recommend state/city/neighborhoods. Targeted price point is preferable under $500k. Thank you!


    What is your ROI Target range? Stating mid to high is still left up to interpretation and I don't like guessing.


     10-15% minimum. Hope that helps


    You will probably only find that in Florida if you are doing direct marketing. It is still a hot market here and there are many investors that have MLS access and scoop up anything close to 10%. I think you will have better luck in Mid-America markets if you are chasing those kinds of returns on small multi.

    [email protected]407-590-9858
    GPG Team 596 Reviews
    WebsiteView Page
    1Reply
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