Investor · Northwest, PA · Member since 2013 · 107 posts · 24 votes
Im looking at Cleveland Heights area for multifamily investing. Looks like a good area. Close to a few colleges, medical facilities, etc. Thoughts on the area?
Most of the buildings are older, brick building but rents seem to be relatively high.
Huntsville, AL · Member since 2015 · 17 posts · 19 votes
11y
I am from Cleveland Heights and I live in University Heights. Location is Key! If you want I can tell you if the street is good or a dog. Houses and units will sit if you don't update the kitchen and or the bath. FYI the high costs and standards of the city have been in place since I was a kid. It is not a symptom of the city trying to gain control. Shaker Hts, University Heights and Cleveland Heights were known for the beauty of the tree filled streets and stately homes. Cleveland Heights is THE rental city. If you get the right street you will do fine. And make sure your leases follow the school year or your house will sit empty. Hope that helps. Oh yeah and if you need information about demographics for subsections within the city, Just let me know. I can help. Good Luck
Investor · Avon Lake, OH · Member since 2014 · 21 posts · 14 votes
11y
Craig,
My advice would be to do thorough research before venturing into Cleveland Heights. My father (Cleveland area GC) is in the process of helping an investor liquidate 20+ SFRs in Cleveland Heights. The homes did not perform well, eve after being purchased at a deep discount during the recession. Lots of tenant issues. Much of this can be attributed to poor management, however Cleveland Heights is a diverse area that needs to be thoroughly vetted.
I have closed several deals in Cleveland Heights in the past few months with investors.
A few things to note:
1. Taxes are high. Rents are higher, but not always proportionally higher. If you do buy you will probably want to look into having the tax value lowered if it hasn't been already.
2. POS-Cleveland Heights has a stringent Point of Sale and require 125% of the POS estimate amount to be put in escrow with the title company if the work isn't completed before closing. I normally negotiate so the seller is responsible for the POS.
3. They require a yearly rental occupancy permit Fee is normally 200-300 per year for non owner occupied properties. And they inspect them every three years. They can give you a list of work needing to be done at that time.
4. Homes do tend to be older so make sure your taking that into account with your maintenance costs.
All that said, there are good values in Cleveland Heights, just have to be aware of higher costs and make sure you are careful where you buy in the city. As @Alex Janesz mentioned a good PM is very important as well.
On my website via my profile there is a video that talks about SF vs. MF in the Cleveland area. If you have never owned any multi's here it may have some useful information for you.
I see you are from PA though. The PA market is pretty similar to the Cleveland market. Personally I do not think it makes sense for someone to invest out of state if the prices close to home are similar. Generally the closer to home you are the cheaper operating the property becomes.
Investor · Northwest, PA · Member since 2013 · 107 posts · 24 votes
11y
@James Wise
Not sure if the @ thing worked...
Thanks James for the link....
I realize operating costs will be more but there are no mid size apartment buildings in my market...looking to possibly buy around the Pburgh area. Plus I don't want to self manage.
I currently manage 16 SFH that we have in our hometown. I want to go the midsize apartment route within the next 2 to 3 years.
Developer · Cleveland / Akron, OH · Member since 2008 · 922 posts · 399 votes
11y
@Craig Montesano Cleveland Heights is very diverse, predominately due to its location. It borders many different areas. You will find large differences between the taylor area up the hill from east cleveland vs Coventry. The variation in crime and the people willing to live there will be night and day. Purchase through someone who knows this 'burb well, it could be the difference between profit and loss.
Huntsville, AL · Member since 2015 · 17 posts · 19 votes
11y
I am from Cleveland Heights and I live in University Heights. Location is Key! If you want I can tell you if the street is good or a dog. Houses and units will sit if you don't update the kitchen and or the bath. FYI the high costs and standards of the city have been in place since I was a kid. It is not a symptom of the city trying to gain control. Shaker Hts, University Heights and Cleveland Heights were known for the beauty of the tree filled streets and stately homes. Cleveland Heights is THE rental city. If you get the right street you will do fine. And make sure your leases follow the school year or your house will sit empty. Hope that helps. Oh yeah and if you need information about demographics for subsections within the city, Just let me know. I can help. Good Luck
Real Estate Agent · Wauconda, IL · Member since 2016 · 208 posts · 99 votes
9y
@Denise Ford I am interested in an apartment building on Superior Road between Cleveland Heights and University Circle. It would get a full rehab, can you give me any insight into this area please? Thanks!
Rental Property Investor · Toronto, Ontario · Member since 2012 · 538 posts · 298 votes
9y
Hi Martin,
Assuming you mean one of the buildings right on Superior and north of Mayfield Road, it is a mixed area. As you get closer to Superior, I would say C+ / B-, more interior from the main road more of a B- / B.
Also, be aware that the property may be in the City of East Cleveland proper which if you read on BP a bit (or just Google it) has issues and does not have the best prospects. Having said that, in the Coventry Road, Superior Road, Mayfield Road triangle, because it has the cemetery on one side and the Forest Hill park on the other, it is somewhat isolated from East Cleveland and more influenced by Cleveland Heights. Also as a plus, close enough to CWU / CC / UC to attract people that go there.
Real Estate Agent · Wauconda, IL · Member since 2016 · 208 posts · 99 votes
9y
@Oren K., thanks so much! Yes, it is in that triangle you mentioned, on Superior Rd. Do you have any information on average rental rates in that area would be? We did some research on Rent-o-meter but would love hard data.
Rental Property Investor · Toronto, Ontario · Member since 2012 · 538 posts · 298 votes
9y
Martin,
I've probably walked the building.
Unfortunately can't be of real help regarding the actual rental rates. Using Rentometer, Craigslist and Showmetherent (and other aggregators), you get a fairly good idea but there is nothing like 'shopping' in person. Remember it is not just the price but also what you get; has the unit been remodeled in the past 10 (or more) years, is the property being maintained, etc.
Also, depends on what kind of tenant you want to attract; the CW Students, Cleveland Clinic Staff, Voucher. IF you are being more selective and screening tightly, you may need to offer a lower price but you may end up with better tenant profile.
Investor · Layton, UT · Member since 2016 · 48 posts · 41 votes
9y
@Martin Vehlow I have a two family on Eddington in that triangle. It has 4/1 up and 2/1 down. Current rents are $750 up and $705 down. These units were completely renovated with new kitchens and baths 8 years ago and the upper unit had a complete paint and carpet done before the current tenant. Even with the POS, city inspections, and high taxes, it's been a steady money maker for me. We had a messy drawn out eviction a year ago that wiped out a lot of profit, though. We used to own a similar two family configuration in Shaker Heights. The rents in Shaker Heights were higher than this one in Cleveland Heights and rented a little quicker. As far as I know, I haven't had students or Cleveland clinic staff as tenants, but not vouchers either. Mostly we have had had working class people live there. I've been happy owning it.
@Denise Ford I am interested in an apartment building on Superior Road between Cleveland Heights and University Circle. It would get a full rehab, can you give me any insight into this area please? Thanks!
Cleveland Heights is a great city to invest in. I always suggest to make sure the address is NOT in East Cleveland if only due to lack of city services.
University Circle is great as well. The rents in Cleveland Heights can go around $1,100 for a SFR depending on the property and its rehab.
Cincinnati, OH · Member since 2013 · 1k+ posts · 1k+ votes
9y
Born and raised in Cleveland Heights and still go by this area every time I'm home. I actually lived on Hillcrest, just off Superior for about 5 years. This was a long time ago, but it doesn't look like it has changed much. As far as investing there, make sure the property is in CH and not EC. Huge difference.
For what it's worth, my father still lives in CH and complains all the time about the neighborhood changing for the worse. He lives off of Mayfield near Warrensville Center Rd.
@Denise Ford I am interested in an apartment building on Superior Road between Cleveland Heights and University Circle. It would get a full rehab, can you give me any insight into this area please? Thanks!
The rental demand is high. Seeing as you need to rehab the building it sounds as though you will be putting out a nice modern product. Doing that you will have high rents from a solid tenant base.
Real Estate Agent · Wauconda, IL · Member since 2016 · 208 posts · 99 votes
9y
@James Wise, thank you that is very encouraging information, very helpful since I am out of state. We have done a lot of research and compiled our cash flow analysis spreadsheet, and are moving forward investigating funding options...
Huntsville, AL · Member since 2015 · 17 posts · 19 votes
9y
@Martin Vehlow Hi, looks like you have some good insights given so far. I would have to say no go on those buildings though. Its too close to East Cleveland and too far from Shopping and I can go on and on. I'm over there at the rec center every Saturday, its very deceiving. If you are looking for what's hot shoot for the John Carroll students. Houses near Cedar Center will rent much better. North of Taylor Rd and South of Cedar Rd is safe bets. Also East of Warrensville Center Rd in both north and south directions as long as you don't go south of the Walmart. Rents range between 1050 and 1650 for sf and mf 750-900. Stay away from carpet and you will rent faster. Original kitchens and baths go for much less and sit longer. Fenced yards and finished basements get higher rents too. Your design need not be fancy just not builder grade if you want the higher rents. Hope this helps.
Depends on where in Cleveland Heights you're looking. Most of the city is suitable for investment for those looking for sold inner ring suburban rental properties. However, it's a large and very diverse city pockets that range all across the A - F letter grade spectrum. It's not as pronounced as if you were to go within City of Cleveland, but you really want to this particular city on a street by street basis.
@Martin Vehlow Hi, looks like you have some good insights given so far. I would have to say no go on those buildings though. Its too close to East Cleveland and too far from Shopping and I can go on and on. I'm over there at the rec center every Saturday, its very deceiving. If you are looking for what's hot shoot for the John Carroll students. Houses near Cedar Center will rent much better. North of Taylor Rd and South of Cedar Rd is safe bets. Also East of Warrensville Center Rd in both north and south directions as long as you don't go south of the Walmart. Rents range between 1050 and 1650 for sf and mf 750-900. Stay away from carpet and you will rent faster. Original kitchens and baths go for much less and sit longer. Fenced yards and finished basements get higher rents too. Your design need not be fancy just not builder grade if you want the higher rents. Hope this helps.
Hello! Can you clarify the suggestion about not to go south of the Walmart? The Walmart i keep seeing addressed in South Euclid is on the West side of Warrensville Center, but the advice is to stay east of Warrensville Center. Also both Cedar Center and John Carroll are South of this Walmart. Is there a different Walmart you are referring to? Or did I get my directions mixed up :)?
Investor · Dallas TX · Member since 2017 · 75 posts · 33 votes
7y
@Craig Montesano i have been investing cleveland area from california. Only thing that really annoying in this area is city POS and violations. City can put citation for weird reasons and you are constantly have to be careful also POS violations when you buy property needs to be fixed before renting it out. City involves too much.
@Isaac Rowe nailed it right. Cleveland heights property taxes are ridiculous for some properties, you have to be careful on that one. Thats the only 2 downsides i would like to warn you about. Having said all these i love the area, good renting potential, numbers will work great as long as you are conscious about the above items.