[Calc Review] Toledo, OH SFR - Analyzed by a Newbie!!!

Investor · Toledo, OH · Member since 2013 · 4k+ posts · 2k+ votes

7y

Originally posted by @Matt Stevi:

*This link comes directly from our calculators, based on information input by the member who posted.

Hey all,

What're your thoughts on this deal? I have never done a deal and have just been learning as much as I can for the past few months so I'm curious to know what other more experienced people think.

The property is a SFR, 2 bed & 1 bath, 855 sq. ft in Toledo, OH (which I've seen there's plenty of people in the forums who invest there, but I didn't do any research into this area in particular, I've just been analyzing a bunch of deals and the numbers associated with them to get more practice).

Location aside, just looking at the numbers (assuming mine are all correct), this is a decent deal, right? $161 cash flow after refinancing isn't as high as I'd like, but the way I have it set up, I got all of my initial investment back and some.

Thanks guys!

Hi Matt,

I love 2 bed, 1 bath homes in Toledo.

The 43612 and 43613 zip codes.

You can buy them cheap and rent out quickly.

Lower long term maintenance due to less sqft.

Buy with cash and don't use leverage.

Before you do that tho, spend 12+ months researching the Toledo market.

I wish you much success

Podcast Guest on Show #89

Oz Realty4.5367 Reviews

Website View Page

0 Reply

Daniel Kramer

Rental Property Investor · Toledo, OH · Member since 2019 · 115 posts · 72 votes

7y

@Matt Stevi I agree with @Engelo Rumora and I'll elaborate a bit. There are pros and cons to small 2br homes in Toledo. I almost pulled the trigger on one the other day. You may have heard Brandon on the podcast push 3br+ but if you know what you're getting, a 2br can be great.

The good: you can buy it cheap. In fact, you should (and might have to) buy cash. It's hard to get loans under 50k and it's really not advantageous to anyways. You can renovate cheap. Only multiply your flooring by 800 sqft, paint, roof, smaller HVAC systems. You have a market for 2br: seniors, recent grads, no kids couples, or eternally single. They all fit the bill and they all can be great tenants. They are good people that just want a garage and maybe a yard for the dog instead of a megaplex apartment.

The bad: Your ARV is limited with a ceiling. So if you plan to cash out refinance to BRRR, you might not get what you want to break even. And again, if it's too cheap in general you might have a hard time getting a loan on it. You might just settle for your cash investment and higher cash flow. And, similarly to the ARV weakness, you might struggle to sell it down the road unless you keep it sparkling and it looks good in pictures. It's not impossible to sell a 2br, but keeping it in good condition will not only be a good business practice but help give it an edge over others and get it off your hands when you want to sell.

Best of luck to you,

Dan

0 Reply

Tim Herman

Member since 2018 · 2k+ posts · 1k+ votes

7y

@Matt Stevi Can I have your lender's name. Most lenders limit the amount of cash out to 70-75% LTV where you are getting 120% LTV. A Small loan like this will more than likely have higher interest rate, plus your expenses may be low. I use 8% vacancy,5% repairs, and 10% capex.

0 Reply

Konstantin Boubev

Rental Property Investor · Howard Beach, NY · Member since 2017 · 52 posts · 28 votes

7y

I had a very hard time finding a decent property manager in Toledo OH. I'm still looking for one, It's been more than one year since I purchased the property. On paper the numbers look good, but unless you self manage, good luck.

0 Reply

Ryan Pyle

Multifamily Investor · Toledo, OH · Member since 2008 · 296 posts · 308 votes

7y

Could you just find one that's already fixed up for $41000? Then you would save the headache and risk of rehab. I speak from experience. I've done loads of rental rehab where costs exceeded expectation and I look back and realize that I could have just bought a house already fixed up and been better off.

0 Reply

Matt Stevi

OP