Brooklyn, NY · Member since 2016 · 21 posts · 5 votes
Good evening all. I'm looking to purchase my 1st rental property, preferably in Cleveland even though I live out of state. I'm not necessarily looking for steady growth in equity, my focus is to buy, hold and build a strong base of residual rental income. I figured multi-family properties would make more sense because in the event of a vacancy the other unit/s could prevent me from coming out pocket monthly. As you can imagine, with this being my 1st purchase I'm trying to make the smartest decision possible so ALL FEEDBACK AND EXPERTISE is welcomed. Thanks in advance.
What neighborhoods are ideal for multi-family renting?
What neighborhoods should I avoid?
Are there any area banks that will finance sub 50k properties?
If not can you recommend any other funding sources?
Can you recommend any property mgmt companies and contractors?
Is it realistic to try to oversee a potential rehab long distance?
The cool thing about investing in CLE is that the Indians are on their way to the world series and the Cavs won the title this past fall. You can be a legit fan if you own property here.
The Cleveland market is broad - so you'll need to focus on specific areas that make sense for what kind of investing you're looking to do.
Here is a link to get you more information on the area, schools, crime, etc. Some zip codes to check out would be 44135, 44144, 44111, 44105, 44102, 44126, 44129, 44134, & 44107. Those tend to be the most popular with investors.
There are lenders that will do sub 50k loans, like @Jerry Padilla, but honestly, unless you're looking at single families in Cleveland, you won't be happy with what you can get for under 50k.
For property management, the company I'm with, Keller Williams has a strong property management division. We manage about 600 units.
@James Wise at Holton-Wise Property Group also manages a large portfolio of properties in the 500-600 unit range. Additionally, @Bob Collett manages in the area and all three come highly recommended by their respective clients.
For contractors, I like @Neal Mahoney at Cloverleaf Drywall and Construction. They do excellent work and are very responsive. Neal has done a number of projects for me recently and I highly recommend him.
Lastly, most PM's will be your project manager for your rehabs if you choose to do something long-distance. Most will not want to take on huge projects, but if you buy something that needs some cosmetic upgrades and updates, this isn't a big deal.
The cool thing about investing in CLE is that the Indians are on their way to the world series and the Cavs won the title this past fall. You can be a legit fan if you own property here.
The Cleveland market is broad - so you'll need to focus on specific areas that make sense for what kind of investing you're looking to do.
Here is a link to get you more information on the area, schools, crime, etc. Some zip codes to check out would be 44135, 44144, 44111, 44105, 44102, 44126, 44129, 44134, & 44107. Those tend to be the most popular with investors.
There are lenders that will do sub 50k loans, like @Jerry Padilla, but honestly, unless you're looking at single families in Cleveland, you won't be happy with what you can get for under 50k.
For property management, the company I'm with, Keller Williams has a strong property management division. We manage about 600 units.
@James Wise at Holton-Wise Property Group also manages a large portfolio of properties in the 500-600 unit range. Additionally, @Bob Collett manages in the area and all three come highly recommended by their respective clients.
For contractors, I like @Neal Mahoney at Cloverleaf Drywall and Construction. They do excellent work and are very responsive. Neal has done a number of projects for me recently and I highly recommend him.
Lastly, most PM's will be your project manager for your rehabs if you choose to do something long-distance. Most will not want to take on huge projects, but if you buy something that needs some cosmetic upgrades and updates, this isn't a big deal.
Thanks Matt that was very informative. In regards to tour statement about what i can get for under 50 in the multi family market. What would you say makes the properties a turn off for you? Area? Cost of rehab?
the multi families you can get for under 50k are either going to need a ton of work or they are going to be in a war zone. If you find something cheap in the zip codes I suggested, it's probably bombed out and you'll need a major rehab to bring it up to rentable shape.
yeah my man, there are a few really good inspectors in the area. As for appraisers, lenders take care of that. If you buy cash, a good agent can do a CMA or BPO for you.
A great appraiser I refer a lot to for legal work is Pete Mizeres from Detailed Home Inspections. If you'd like, I'll let him know you'll call @Chris Sean.
Most sub 50k property deals are for locals. They're more management intensive and generate less monthly rents (and thus less management fees) so it's very hard to find a good PM for that asset class. When investing remotely I recommend thoroughly vetting and hiring a good local management company as most that try to self manage remotely run into serious problems sooner or later. Find your managers first.
the multi families you can get for under 50k are either going to need a ton of work or they are going to be in a war zone. If you find something cheap in the zip codes I suggested, it's probably bombed out and you'll need a major rehab to bring it up to rentable shape.
Not necessarily true that properties of under 50k need ton of work. I would say about 80% ton of work and 20% little work to cosmetic which can be rare. The only way to know for sure is to gain access to the property and do a cost estimate to determind repair cost if reasonable. I will agree that zip code should be a primary focus when buying a property.
@Chris Sean Have you already decided on the zip codes you will focus on? I have begun to look at investing in Cleveland as well as NYC is way too expensive; I am glad that you asked these questions. Thank you everyone for such insightful answers!
I will definitely be reaching out to some of the contacts mentioned in this forum in the coming months.