Multi-family investing Toledo Ohio

9 Replies

I purchased my first property at the end of last year a single family in the Washington local area, rehabbed it ,refinanced , and now I'm looking to repeat.  Using only this strategy I'm only working with about 50,000 to 60,000 ,and my ultimate goal is to get into larger multifamily units for greater returns for buying hold. I've been considering trying to acquire hard money to go with what I have, or even trying to find schedule 2/or land contract deals to maximize my returns.   Are there any investors in the Toledo area that have used hard money, or have acquired properties through land contract?  If so ,what were some of the obstacles you've had to encounter ?  I would definitely love to hear back from you . Thanks

With with single families it just seems to be such a slow process, unless you buy them dirt cheap,and in not so desirable areas, like the 43605/43609/43608  I've been keeping my searches towards Maumee area, some of West Toledo and Holland , Point Placed even. It just seems if I was able to acquire maybe an 4, 6,or8+units I would be able to grow my portfolio quicker ,and once I got 16 or better, possibly hire a property management company to run it, which would leave me more time to acquire more properties, would love to have it on one parcel.    As far as returns, I am seeing good return on the one that I have ,single family, just seems it's always going to be 4 to 5 month turn around for Rehab. Then when you're dealing with banks that's another month or better.

I see you're a member of Reia, I am also, I became a member last year. I think we might have even met ,I'm not sure. I have atended both meetup groups , the one on West Sylvania by the library the first Tuesday of the month , and the one across from Toledo Clinic on Secor

Originally posted by @Account Closed :

I purchased my first property at the end of last year a single family in the Washington local area, rehabbed it ,refinanced , and now I'm looking to repeat.  Using only this strategy I'm only working with about 50,000 to 60,000 ,and my ultimate goal is to get into larger multifamily units for greater returns for buying hold. I've been considering trying to acquire hard money to go with what I have, or even trying to find schedule 2/or land contract deals to maximize my returns.   Are there any investors in the Toledo area that have used hard money, or have acquired properties through land contract?  If so ,what were some of the obstacles you've had to encounter ?  I would definitely love to hear back from you . Thanks

Hi John,

Well done on your first deal in the Washington Local School District.

It's hard to find any decent multifamily opportunities right now in Toledo.

The "smart money" is sitting on the sidelines and patiently waiting for a few of the big multifamily investors mistakes to come to fruition

I've always preferred the "longer" and "harder" way when it comes to investing

And that is buying with all cash

A method that has served me very well is buy, fix and flip (Maybe it's something that you can consider doing also)

Then, "rinse and repeat" 

I've been doing this ever since I moved to the US and have stopped counting how many deals I've done after #500 lol

Nothing beats hard work

Thanks and much success

I've definitely been considering Fix and Flip as another option to gain access to more capital.  Roughly ,what has your time frame been after the Fix and Flip to get a property under contract and sold?

Hi @Account Closed , I have purchased multifamily with hard money and owner financing. Here are two examples:

1. 2289 Upton Ave, 19 unit apartment building, price $175k. I borrowed $168k from hard money, and put about $14k of my own money into the purchase (the upfront fees were really high). The building was 50% occupied when I bought it. I put another $15k into deferred maintenance and unit prep, and had it fully occupied in 3 months. It re-appraised for $300k (due to increased NOI) and I refinanced it in 6 months. In this situation I had to used hard money because the lending environment was still pretty tight (Feb 2013) so commercial lenders weren't too excited about distressed investment property. But I did have a lender verbally agree to a refinance once the property was stabilized. This deal worked because I was able to purchase the property from a distressed owner for less than market value, as there weren't many buyers out there at the time. Don't worry...this situation will come again. It always does...

2. 1338 Brooke Park Dr, 8 unit apartment building, price $105k. I put $25k down and the owner financed the $80k balance. I agreed to pay her off within 3 years. This building was 50% occupied. The owner was 80 years old and sick of being a landlord, and she was admittedly bad at landlording. I put about $15k into deferred maintenance and unit turns and had the building stabilized in 3 months. It reappraised for $175k and I refinanced her out in 6 months. This was April 2014, so again the market had not yet quite picked up, so there wasn't a lot of competition.

I hope this helps. I tried to give you some real world examples. Please note the moral of the story...these deals worked because I bought way under market and had loads of room to cash the hard money/owner financier out. I was able to buy under market value because there wasn't any competition. In other words...right now probably isn't the time to do these deals, especially hard money as the risk of you getting caught short by a decrease in value before you can refinance is huge. But these deals will probably be available in the not-so-distant future...

thank you for your Insight Ryan! It's been a great help for sure. What is your thoughts on Fix and Flip properties to gain more access to Capital for buy and hold? Have you had any experiences with Lucas County sheriff auction deals? If so, what are some of the pitfalls and things one should watch out for?

@Account Closed

The pitfall of purchasing a property at the sheriff's auction (foreclosure sales) is that it takes up to 2 months from the auction date for the sheriff's office to collect required paperwork and prepare the title.

During this time, the house still technically belongs to the person who foreclosed on the property. Which means that should anything happen to it, 1) you already made a deposit that is not going to be returned, and 2) you have no control over the property for at least a month (of not two, if not even more if it is occupied and you have to file a writ of possession once you make the full payment and receive the deed).

You should also know that banks will buy back the property at the sheriff's auction for the outstanding foreclosure amount, which sometimes is way above appraisal and market.