Out of State Real Estate Investing in Dayton Ohio

10 Replies

Hello Fellow Investors! I was a Realtor in Philadelphia, Pa so I am aware of the Real Estate Market here and how the prices of Real Estate are absolutely ridiculous.  I have a couple of Questions about doing out of state Real Estate investing out of state in Dayton Ohio. I live in Philadelphia PA, and investment properties prices are through the roof. If you were to buy a duplex in a C class area it would run you no less than 165,000$, thats if you got lucky in Philadelphia. So if you wouldn’t mind, I would really appreciate it if anyone can answer a few questions I have. 

So I want to know from experianced out of state investors, how hard is it to own property out of state, and how good is the property management company you use, when it comes down to it being a headache, after all you are paying them every month so that you don’t have that headache. 

Also for investors who invest in the Dayton Ohio Area, what neighborhoods are good to invest in, because I've heard that there are some neighborhoods that I should stay away from. Also what are the ROI in the properties you own? And the average price of the Property you own?

I am looking to purchase my First Investment property in the next 12- 16 months, so I am trying to get as much information as possible, so that I can determine of I should buy Real Estate in The Dayton area/out of state or not. 

THANK YOU IN ADVANCE! 

Hi  @Moe Daoud ,

I know this may not answer your question, but I think you may be looking at the wrong areas in Philadelphia. Are you only looking at Turnkey investment. 165k seems really high for duplexes in most of the city.  Our triplex was 165k all in.  It's in Germantown. 

Philly has so man properties zoned RM1 that can converted to duplexes and triplexes without a zoning variance. What are you considering a C class area?  I see great deals in Wynnefield, Overbrook, Sharwswood, Germantown, Parkside ect. Not to mention great opportunities on the fringes of gentrifying areas that you can get dirt cheap. 

Originally posted by @Moe Daoud :

Hello Fellow Investors! I was a Realtor in Philadelphia, Pa so I am aware of the Real Estate Market here and how the prices of Real Estate are absolutely ridiculous.  I have a couple of Questions about doing out of state Real Estate investing out of state in Dayton Ohio. I live in Philadelphia PA, and investment properties prices are through the roof. If you were to buy a duplex in a C class area it would run you no less than 165,000$, thats if you got lucky in Philadelphia. So if you wouldn’t mind, I would really appreciate it if anyone can answer a few questions I have. 

So I want to know from experianced out of state investors, how hard is it to own property out of state, and how good is the property management company you use, when it comes down to it being a headache, after all you are paying them every month so that you don’t have that headache. 

Also for investors who invest in the Dayton Ohio Area, what neighborhoods are good to invest in, because I've heard that there are some neighborhoods that I should stay away from. Also what are the ROI in the properties you own? And the average price of the Property you own?

I am looking to purchase my First Investment property in the next 12- 16 months, so I am trying to get as much information as possible, so that I can determine of I should buy Real Estate in The Dayton area/out of state or not. 

THANK YOU IN ADVANCE! 

 I do not know much about Dayton. I have not really heard of many investing there. Is there even a demand? I do not know much going on there aside from the airforce base. Ohio itself has been doing very well though. Have you looked into some of the bigger markets? Might get you a better return for the same housing price.

@Moe Daoud and @Tom Ott , there is a lot of demand in Dayton for good rental properties.

Every city has neighborhoods you should stay away from unless you are comfortable taking a higher risk for a potential higher return. Prices and boarded up houses are good indicators for areas that are distressed.

@Amina Jackson, 

Thank you for your reply. I am aware of those areas, im just not interested in investing in high crime areas. If I were to invest  In Philadelphia it would be in Northeast Philadelphia. 

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wow.... I didn't realize we were having to sling mud to try and influence other investors.

@Moe Daoud as @Darrin Carey mentioned (and MANY MANY others on this sight both local and OOS) Dayton is a great place to invest.  I'm a local investor who is not originally from Dayton but stay and invest here because of the awesome opportunity that the area presents.  We have a very good network of professional investors here locally, the cashflow is tremendous, prices are cheap, and IMO on the upswing.

p.s.

Do a keyword search and see for yourself how many people are investing here.

p.p.s.

I know and work personally on RE for a BIG investor out of Kansas City that is buying things in Dayton as fast as they can

The rental demand is partly due to the enormous air force base, its many specialty manufacturers and military contracts, its two big universities and the slow resurrection of the auto industry which was devastated by the shuttering of GM at the crash time (I think it was 2007).

The north side of town has the best housing stock in my view. And the west side has the highest murder rate. Look at North Riverdale, grafton hill (C), or kettering (B) for the best housing stock for low money. How low? In North Riverdale (C) last year I bought a duplex for $14,000 including closing costs. Added about another 15k and some significant sweat and she now rents for $1,600 plus utilities.

Keep this in mind if you buy government repos (HUD, Fanny, Freddie, city, county) in Dayton - when they go through the sheriff's sale, the county foreclosure process does some of the best title work anywhere.

Hi Moe,

Thank you for interest in our area. Like any city, Dayton has nice areas and not so nice areas. Here are my own considerations for investing in the area:

- Wright-Patterson Air Force Base is the biggest employer not only in the area, but the entire state (or so I'm told). I even work there for my 9-5. Approximately 20,000 of the 30,000+ there are government civilians, most of which are either Dayton natives or plan on staying here long term. What does this mean for investors? Stable employment, good salaries, and not much risk of losing employees due to layoffs or relocation.

- While the Air Force is not the only employer, other large companies in the area offer no guarantees. A couple of the largest employers in the area have left Dayton in the last 10 years or less, which has not helped with growth.

- Dayton does not see a lot of rent or property value fluctuation. Just steady, slow appreciation over the long term. I doubt we'll see west coast property value swings though.

- I personally avoid the area directly west of I-75/the Miami River. You can find extremely cheap properties (less than $20k) in some of those areas and with good reason in my opinion. I have heard of out of state investors buying these properties only to sell them once they realize that it's a D neighborhood. There are good people in all neighborhoods, but if investing out of state you'll set yourself up for a very high chance of having tenant issues.

- South of the city is generally good especially right around I-675. Beavercreek, Yellow Springs, Bellbrook, Centerville, Kettering, Oakwood, Springboro, all are B or A areas. My preference is finding properties here because very high ranked school districts drive demand in Dayton.

- I can't speak too much about the north city of the city demand-wise. It seems hit or miss by neighborhood.

- Dayton is currently a nation-leading city in the heroin/fentanyl epidemic. Because of this, I would suggest putting systems in place to vet possible addicts/traffickers.

Let me know if you have any other questions.

- Ryan

what’s everyone’s thoughts on Fairborn? It’s right outside the base.

@Ryan Provost wrote: I can't speak too much about the north of the city demand-wise. It seems hit or miss by neighborhood.

You are quite right it is hit or miss on the north side. At the low end is Santa Clara, a blighted area which is basically the skid row of Dayton, Ohio. At the high end are places like grafton hill where the houses are too high end for rentals in my view or some parts of Shiloh where mid-century modern mansions are up on the hilltops. The best areas for investors are those that have a lot of really nice smaller houses and a mix of B- and C or C+ grade neighborhoods. The northern part of zip 45405 is like that, north of hillcrest. Here is a map of an area. It has stabilized in recent years and rents and prices are taking off this spring. I circled a couple of turnkey SF sales that went for a little over 50$/square foot in nice shape. This spring, the rental demand and purchase prices are on an absolute tear since the sf prices started going above 50k. Its a key breakout point because above 50, most banks will do mortgages. I would describe the C areas (most of Dayton proper) as highly deleveraged at this point in time and prices are poised to skyrocket as values rise above 50k.

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