Cleveland vs Columbus vs Toledo. Which one do you invest in?

Ohio Real Estate Q&A Discussion Forum
6yFollow

Cleveland vs Columbus vs Toledo. Which one do you invest in?

Brad M.
Investor · OH · Member since 2019 · 23 posts · 19 votes

1st  Post in BP. Newer resident in Ohio. Was previously investing in SW Florida, where I have 2 rentals. Have taken a hiatus from investing in real estate over the last 5 years to buy and grow a manufacturing business. Now that I have stabilized it and am generating good cash flow, I'm looking to actively invest in the Ohio area. I've mostly been considering Cleveland, Columbus, and Toledo and am interested in which one you would choose and why. I live in a very small town that is pretty close to the same distance from all 3 cities. I have my own opinions on which is best (for me), but I want to see what other people think and why. Would be especially interested to hear from anyone who invests in 2 or all 3 of the cities mentioned above.

Because someone will probably ask, here is some more info on preferences, goals, info. 

  1. I'm not trying to replace my every day business with real estate investing. I just want to diversify income streams.
  2. I play the long game. Very little interested in short term stuff.
  3. When it comes to investing risk, I lean towards being more conservative.
  4. I love a good tax write-off.
  5. Interested in SF or MF, but am more versed in SF. 
  6. Most interested in Class B or A.
  7. I value equity over cash flow, but it still has to cash flow.
  8. Looking at purchasing 2-3 properties a year.
  9. I'm a big fan of passive investing. The more passive the better.
  10. I am interested and actively researching other markets as well. The appeal of these cities to me is the proximity to my business and the ability to hire employees that can manage/operate them once there are enough properties to justify it.
4Reply
164 views

Most Popular Reply

Gaspare U.
Rental Property Investor · Cranford, NJ · Member since 2019 · 245 posts · 148 votes
6y

I too am looking into Columbus for investment opportunities. I was at a crossroad between Columbus, Cincinnati and Cleveland. I chose Columbus for these reasons:

  1. Unemployment is 3.6
  2. City and MSA Population has grown over last 5 years
  3. Well diversified Industry with Education being #1 and less than a quarter of the total. 
  4. JPM 20k, Nationwide 12k, Honda 11k, L Brands 8600, Cardinal Health 5k full time employees
  5. Rents have increased year after year (unfor so has vacancies) 
  6. 5 week eviction process

I have more but I'm not here to do your target market research :) but it's a start. Good luck!

3Reply
See this reply in the discussion

24 Replies

Jump to latestLatest
  • Austin Steed
    Real Estate Agent · Columbus, OH · Member since 2016 · 593 posts · 664 votes
    6y

    @Brad M.

    And from previous post you can see the population and job growth that's happening in Columbus compared to others. 

    Also another variable that makes Columbus stand out is OSU. Cleveland has great academic schools such as Case Western, but the number of students attending schools there don't really compare. 

    Institutions

    SchoolLocation(s)Enrollment
    Cleveland State UniversityCleveland17,730
    Kent State UniversityKent29,477
    Miami UniversityOxford18,620
    Ohio State UniversityColumbus58,322

    Over 40,000 students in OSU undergrad. 10,000 plus seniors are graduating every year. And unlike Miami University we have a City that can offer jobs.

    One other factor to think about is when you visit Columbus you will see cranes all over building large MF properties. 

    Also full disclosure... I am a Buckeye and own 5 units in the Columbus market so there may be some biased here!

    1Reply
  • Gaspare U.
    Rental Property Investor · Cranford, NJ · Member since 2019 · 245 posts · 148 votes
    6y

    I too am looking into Columbus for investment opportunities. I was at a crossroad between Columbus, Cincinnati and Cleveland. I chose Columbus for these reasons:

    1. Unemployment is 3.6
    2. City and MSA Population has grown over last 5 years
    3. Well diversified Industry with Education being #1 and less than a quarter of the total. 
    4. JPM 20k, Nationwide 12k, Honda 11k, L Brands 8600, Cardinal Health 5k full time employees
    5. Rents have increased year after year (unfor so has vacancies) 
    6. 5 week eviction process

    I have more but I'm not here to do your target market research :) but it's a start. Good luck!

    3Reply
  • Tom Ott
    Equity Raiser and Turnkey Provider · Cleveland, OH · Member since 2016 · 4k+ posts · 1k+ votes
    6y
    Originally posted by @Brad M.:

    1st  Post in BP. Newer resident in Ohio. Was previously investing in SW Florida, where I have 2 rentals. Have taken a hiatus from investing in real estate over the last 5 years to buy and grow a manufacturing business. Now that I have stabilized it and am generating good cash flow, I'm looking to actively invest in the Ohio area. I've mostly been considering Cleveland, Columbus, and Toledo and am interested in which one you would choose and why. I live in a very small town that is pretty close to the same distance from all 3 cities. I have my own opinions on which is best (for me), but I want to see what other people think and why. Would be especially interested to hear from anyone who invests in 2 or all 3 of the cities mentioned above.

    Because someone will probably ask, here is some more info on preferences, goals, info. 

    1. I'm not trying to replace my every day business with real estate investing. I just want to diversify income streams.
    2. I play the long game. Very little interested in short term stuff.
    3. When it comes to investing risk, I lean towards being more conservative.
    4. I love a good tax write-off.
    5. Interested in SF or MF, but am more versed in SF. 
    6. Most interested in Class B or A.
    7. I value equity over cash flow, but it still has to cash flow.
    8. Looking at purchasing 2-3 properties a year.
    9. I'm a big fan of passive investing. The more passive the better.
    10. I am interested and actively researching other markets as well. The appeal of these cities to me is the proximity to my business and the ability to hire employees that can manage/operate them once there are enough properties to justify it.

    Columbus is good, but very HOT. You need to be diligent to find a good property. They exist, you just gotta find them. I would look for an agent first. Toledo is nice. It's stable. Not a ton of growth, but you can find good deals. Cleveland is very good. Stable, but seems to be on the upswing. I may be a little bias, but it seems like there is a lot of growth lately. 

    3Reply
  • Brad M.
    OP
    Investor · OH · Member since 2019 · 23 posts · 19 votes
    6y

    Thanks for the input guys. I expected Columbus to be the overwhelming favorite. My thought process is maybe different than most, and admittedly I'm no where near an expert on any of these cities. While I think it would be almost impossible to argue that Columbus doesn't currently have a better market than the other two options, I'm concerned that the craze to buy there has created artificially inflated value. A feeding frenzy if you will. For example, I put in an strong offer (20k+ over asking, but to be fair, asking was low) on a cash only house in Grandview Heights last week that needed 100k in renovations. I was 6th out of 21 offers and it was only on the market for 2 days. I would love to invest in Columbus but I've been having a hard time finding a deal that I see value in up to this point in time. I need to grow my contacts and deal finding methods, which I have just started focusing on. That's why I joined BP. I'd definitely be more excited to invest in Columbus than the other 2, and I have a few contacts there. Ultimately a good deal is a good deal no matter what city it's in, and that's what I'm after.

    1Reply
  • Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    6y

    @Brad M. Columbus because I live here, work here, and play here. I am about to have 16 doors. Can't stop, won't stop

    I would recommend looking into multifamily properties. Sure Grandview will be EXTREMELY competitive but there are other areas that are not as hot AND provide solid cash flow AND appreciation opportunities. Not every deal goes for above asking and if you use the right Realtor, you will have amazing opportunities. All you have to do is find the right team to work with.

    [email protected]614-541-8475Podcast Guest on Show My Job Laid Me Off, So I Replaced My Salary with Rentals
    Reafco512 Reviews
    WebsiteView Page
    2Reply
  • Vince Lucas
    Flipper/Rehabber · Cleveland, OH · Member since 2016 · 133 posts · 69 votes
    6y

    @Brad M.

    The biggest factors is finding a good team in whatever city you choose. If you do not great people helping you it doesn’t matter what city you choose.

    3Reply
  • Account Closed
    Real Estate Broker · Columbus, OH · Member since 2019 · 119 posts · 151 votes
    6y

    I'm a sucker for Columbus. Look at the companies flooding our market...Facebook, Google, CoverMyMeds...and the companies that are already here...Nationwide, THE Ohio State University, Big Lots, Chase, L Brands, Children's Hospital, and the list goes on. Columbus is turning into a little-Chicago. Tons of opportunity in path of progress areas. I look for stable landmarks (companies) and follow the growth. If companies like this are hedging their bets on areas like this, what do they know that we don't? I'll follow the big guys and ride their coattails all day! Best of luck!

    2Reply
  • Stone Jin
    Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
    6y

    If you are already in Ohio, just invest near you.  It would be a good start to your journey.

    1Reply
  • Brad M.
    OP
    Investor · OH · Member since 2019 · 23 posts · 19 votes
    6y

    @Stone Jin

    Small town residential investing is not something I generally get too excited about because the class property here is mostly D with some C, and quality tenants are few and far between. Plus in a small town everybody is in your business. The rental pool is small and they all just got fired or arrested (I know, they work for me). I could go 30 minutes outside my town but its not that much better there. The volume, professional services, and scalability available in the larger cities fits my long term strategy, as I'm not looking to manage most properties myself. I'm basically looking to park my business profits in real estate to create alternative income streams with high appreciation potential. I'm not afraid of long distance investing. My rentals in Florida are 18 hours away, and I've never had any major issue managing them from Ohio.

    I'm not 100% against small town investing. I regularly analyze local deals. I have a mixed use building I'm negotiating right now in my town (12 plex upstairs with 7 commercial spaces downstairs on the major state road) that is very poorly managed and the upstairs needs gutted, but that is a unique situation. I'm also negotiating the purchase of a 40,000 S.F. warehouse for my business that I'm hoping to close by next summer once the current occupants lease is up. I'm interested in those properties mainly because they're good deals and they're 1/2 a mile from my house. 

    1Reply
  • Stone Jin
    Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
    6y

    @Brad M.  :) Well there you go, you will soon be king of your town.  I think it all boils down to asset class and price point.  If you want to invest in B+ A- assets but have C+ budget in mind, then Toledo may for you.  If you have A+ budget and want warzone then any city will do.   

    I like Toledo because I'm grew up there and boots on the ground.  I can still find 1% rentals in nice neighborhoods.  I'm not sure about the other markets but they all are likely more expensive than Toledo for comparable asset class.  However appreciation will differ by market with Toledo trailing the bigger cities.  So it all depends on your goals, strategy and risk tolerance.

    1Reply
  • Brad M.
    OP
    Investor · OH · Member since 2019 · 23 posts · 19 votes
    6y

    @Stone Jin

    No where close to king of anything. Just a sucker for a good deal. 

    If you don't mind me asking, what areas in Toledo do you invest and in what type of properties? I'm least familiar with Toledo of the 3 cities, even though it seems like I'm there all the time. I'm always going to the same places, but usually I'm on a non-real estate related mission. I've been in Maumee and Holland enough and it seems like nicer areas that are growing. I see new residential and commercial construction on the routes I travel. 

    0Reply
  • Stone Jin
    Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
    6y

    @Brad M.

    I try to buy exclusively in Sylvania school district. My contractor lives there and so does my father so I try to make it convenient for them whenever I need their help.

    I’m also considering holland Ottawa hills and old orchard areas.

    0Reply
  • Account Closed
    Rental Property Investor · Brooke Park Drive · Member since 2018 · 1k+ posts · 2k+ votes
    6y

    @Stone Jin Whats the origin of your name?

    0Reply
  • Mark Welp
    Investor/Agent/CPA · Columbus, OH · Member since 2015 · 249 posts · 207 votes
    6y

    @Michael P.

    I live in Columbus and buy in both Columbus and Cleveland. Both are good rental markets.

    Thanks,

    3Reply
  • Stone Jin
    Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
    6y

    @Michael P. Lol. I hail from a long line of stones. My father is Boulder and my son is Pebble.

    Just a nickname.

    3Reply
  • Brad M.
    OP
    Investor · OH · Member since 2019 · 23 posts · 19 votes
    6y

    @Account Closed LOL. Glad we got that cleared up.

    @Mark Welp

    What areas in Columbus and Cleveland do you invest? I see from your profile that you invest in SFH and have multifamily.

    In Cleveland I was looking in Solon, downtown, and Clark-Fulton near the hospital (I hear their about to start an initiative there). In Columbus I was interested in Southern Orchards, the western edge of Olde Town East, and Clintonville. Was told I should look at Worthington too, but hadn't looked into it yet.

    Also, curious if you specialize in any particular area as a CPA? 

    1Reply
  • Account Closed
    Real Estate Broker · Columbus, OH · Member since 2019 · 119 posts · 151 votes
    6y

    @Mark Welp I would take Clintonville off of your list. There are similar areas surrounding Clintonville that have lower buy-in prices with higher rents. Clintonville is a classic staple in the Columbus community and as an investor, I don't see a lot of opportunity in this area. I'm a Clintonville native and sold my inventory there to push it into other markets with higher upside. 

    1Reply
  • Account Closed
    Real Estate Investor · Waldorf, MD · Member since 2014 · 592 posts · 320 votes
    6y

    I've rolled the dice between the 3 C's and we've selected Cincy:

    Low Health insurance

    Affordable Housing

    Top 25 places to live

    Below the national unemployment rating

    High Rent to Price ratio

    We're working with brokers now but can always work with more.  We're looking for an apartment deal.

    1Reply
  • Mark Welp
    Investor/Agent/CPA · Columbus, OH · Member since 2015 · 249 posts · 207 votes
    6y

    @Brad M. In Columbus, mostly invest in SFH on the east side. In Cleveland, once you get past the city POS, I like Maple Heights. Yes, my CPA firm can assist really any size real estate investor on tax planning, compliance, and bookkeeping. Bookkeeping is the key to understanding your tax planning and tax strategy. I use QB online. Thanks!!

    2Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes
    6y
    Originally posted by @Brad M.:

    1st  Post in BP. Newer resident in Ohio. Was previously investing in SW Florida, where I have 2 rentals. Have taken a hiatus from investing in real estate over the last 5 years to buy and grow a manufacturing business. Now that I have stabilized it and am generating good cash flow, I'm looking to actively invest in the Ohio area. I've mostly been considering Cleveland, Columbus, and Toledo and am interested in which one you would choose and why. I live in a very small town that is pretty close to the same distance from all 3 cities. I have my own opinions on which is best (for me), but I want to see what other people think and why. Would be especially interested to hear from anyone who invests in 2 or all 3 of the cities mentioned above.

    Because someone will probably ask, here is some more info on preferences, goals, info. 

    1. I'm not trying to replace my every day business with real estate investing. I just want to diversify income streams.
    2. I play the long game. Very little interested in short term stuff.
    3. When it comes to investing risk, I lean towards being more conservative.
    4. I love a good tax write-off.
    5. Interested in SF or MF, but am more versed in SF. 
    6. Most interested in Class B or A.
    7. I value equity over cash flow, but it still has to cash flow.
    8. Looking at purchasing 2-3 properties a year.
    9. I'm a big fan of passive investing. The more passive the better.
    10. I am interested and actively researching other markets as well. The appeal of these cities to me is the proximity to my business and the ability to hire employees that can manage/operate them once there are enough properties to justify it.

    I don't think any 1 market is "better" it's all about what type of investment you are looking for. Cleveland and Toledo are fairly similar in that they are your "cash flow" type destinations. Columbus on the other hand has a much higher price point and a rising population so it's not all that similar to the other two. If you'd like more info on the Cleveland market you can check out The Ultimate Guide to Grading Cleveland Neighborhoods.

    1Reply
  • Steven Lowe
    Real Estate Agent · Scottsdale, AZ · Member since 2019 · 448 posts · 320 votes
    6y

    My business partners own and operate several properties in Toledo including a 200,000 SF mixed use tower on the Maumee River and an office park.  The returns there are pretty unbelievable.  They have bought vacant Class A office for under $25 /SF.  I recently saw some Class A MF in the teens on cap rate.  Those types of deals in Chicago, where I am based, would have been in the low 7's or upper 6 cap.  Can't say if Cleveland or Columbus would be better but they really like Toledo.  One of the partners just relocated there.  

    1Reply
  • Remington LymanBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2017 · 6k+ posts · 7k+ votes
    6y

    @Brad M. Southern Orchards and Olde Town East are attractive cash flow neighborhoods for out of state investors. I agree with @Account Closed (my broker) about Clintonville. In-state investors like Jimmy (owner of Buckeye Doughnuts) but up duplexes and quads in Clintonville at prices that have negative cash flow.

    For example:

    Purchase price of $280,000

    Rehab of $100,000

    ARV of $440,000

    Rent of $3,000/month

    Most out of state/town investors that are looking to get into Columbus, Ohio will not be using this investment strategy. Having said that, I am hunting for those clients because 3% of $280,000 then 3% of the sale of $440,000 is a great day.

    [email protected]614-541-8475Podcast Guest on Show My Job Laid Me Off, So I Replaced My Salary with Rentals
    Reafco512 Reviews
    WebsiteView Page
    1Reply
  • Rob Gillespie
    Specialist · Cleveland, OH · Member since 2011 · 1k+ posts · 852 votes
    6y

    Hi Brad, 

    I do not do all of the markets, just Cleveland for 22 years. 

    1. HUGE medical base

    2. 3 sports teams

    3. Casino

    4. Tons of tourism stuff to do on the lake. .

    The reason I mention this is because there is a ton of work for tenants and housing is very inexpensive. even in the burbs with A and B class, you can buy far below market value and start out with a ton of equity and cash flow is still there. 

    When the crash hit, we were barely affected in the Cleveland burbs. Inner city is a different story, unless you are in one of the areas of gentrification where there is a HUGE upside. 

    I did about 100 deals in the  Mansfield market and it just did not compare to Cleveland because of the lack of everything I listed above. 

    If you are not far from the area and wanna meet for coffee, I am open .

    Good luck!

    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free