Hi Everyone,I have had my eye on Ohio for the last year in a half. I’ve been reading real estate books and listing to countless hours of audio books as well. I have made an agreement with my wife to buy our first duplex out of state in Lakewood Ohio, 6 months from now. We live in Oceanside CA but really like the cash flow that Ohio properties provide in rent. Here’s a little bit about me and my plan below...
I have made it my goal yesterday to buy my first multi family home in or around Lakewood Ohio! I’ve been reading and studying real estate books and pod casts for about 1 year and a half now. I’ve been saving up and trying to hit my other goal of a 20 percent of a down payment for the property. Which should be complete in the next 6 months from now. I’ll put my plan below and I’m more then open to any suggestions or corrections you may have for me. •My wife and I will be looking around Lakewood Ohio for a multi unit property to rent out. Our goal is to save up as much as we can in six months and our down payment at that time should be around $14,000-20,000 dollars. I know 20-25 percent must be put down in order to qualify for a loan that would allow us to buy an investment property. I’ll provide you with the list of the areas I have kept my eye on and am interested in below... -Lakewood: 2,3Bd/1Bth rents are ($700-1,000) per unit. -Eastlake: 2,3Bd/1Bth rents are ($875-995) per unit -Madison: 2,3Bd/1Bth rents are ($700-1,150) per unit -Willoughby: 2,3Bd/1Bth rents are ($750-900) per unit •Here’s the business/investment plan we have in mined. We are looking into putting in plenty of offers for duplex’s/triplexes/quad plex and even 5 until building. Property’s with 2bed and 1 or more bath on each side of the unit would be what we are looking for, but if the property only has 1 room in each unit. There would need to be attic space or something like that, where I could have a contractor add an additional room or 2. The property would need to be in rent ready conditions or at least close to it. I am looking for motivated sellers or a seller who is willing to sell for a lower price. The strategy that we would like to use is, making offers on property’s at 30 percent off the asking price. The reason for that is to have at least 30 percent Equity in the property as soon as we close on it. Our budget level is $95,000 or lower on the property. After purchasing the property with a 30 percent discount on the asking price. After about a year of owning the property I would like to refinance the 30 year fix loan, for a 15 year fix. Then pull out my equity of the property except for 25 percent and use some of that money to fix up the current property, but using the rest of the money to buy another multi family property. Then eventually repeat the process until we hit our goal of 5 multi family homes that all cash flow over the mortgage rate. At that point I’ll pay off as many as possible and then continue the strategy with nicer property’s or Adventure my way to commercial apartment type of properties with six units or more. •Another part of the strategy, I would implement is to have a property management company set in place, since I live out of state. It would make it easier to manage. •By any chance would you happen to know of a real estate attorneys that could creat an LLC for me, Loan Officer, property manager, general contractor, home designers that you would recommend in the area? If you have somthing that I could help with, I’d be more then happy to help you with what little resources I have so far :)
Good luck on getting ready to take the plunge! Sounds like a more or less doable strategy. Not sure if you're looking for input, but I'd say don't get too attached to your 30% figure. Lakewood is pretty hot and a set discount off an asking price is pretty arbitrary. Someone will pay what the property is worth, and that's different for everyone. I'd focus more on whether or not you can make it work for whatever your cash flow number is.
Greetings! I'm located in the Oceanside area as well! Im currently going through the same process trying to figure out where and how to do it. Let me know if you want to meet up!
Thanks @Ryan Evans ,
I'm not too attached to the 30% lucky, but i would like to negosiate up from thirty and land a deal that holds some equity. The cash flow does look realy good even if I were to recieve a 0% discount because the mortgage payment is so low. Im planning on it being a 2 part stratagy in theory, but I'm sure things will changes a bit after I jump in.
Do you invest in Lakewood by any chance?
Hi @Jeremy Leech ,
Yeah we should get a coffee some time.
Yeah, that's the thing about properties out there. You don't even need to buy at a discount to get better cashflow than the rest of the country! I actually would have paid 10k more than I did for my last property, but the market isn't as hot. But no, I'm not in Lakewood. Wouldn't be against it though as it still fits my criteria.
Create Lasting Wealth Through Real Estate
Join the millions of people achieving financial freedom through the power of real estate investing