Ohio Cashflow LLC Review, 2018
Hi,
I’ve purchased two properties via Ohio Cashflow ~6 months ago and I would like to share my experience. Before I made my decision, people’s reviews helped a lot so I would like to help future investors make a more informed decision.
Overall, I am very satisfied with the experience. I will comment on what I liked and what were some of the “bumps in the road”.
About me:
I am an academic, I do nerdy things to make a living. I’ve never bought/sold a house before my deal with OCF thus I am inexperienced when it comes to investing. I point this out because I know there are people out there who are looking into investing in turnkey but hesitate because they are inexperienced as well. I am living proof that you can invest in turnkey without a background in real estate investment. My experience so far was very satisfying.
My experience with the company:
+ I've reached out to them. After initial phone talks and we decided that it is a good match, I informed them about my goal: I have Y amount of money and I would like to purchase houses that have 2X% (two times X, not 20+) net cap rate. (An idea about the numbers. 3X (three times X) = a cap rate that you would consider a good deal even for a REI professional living and working in Toledo. As an out-of-state investor I hoped for 2/3 of it, which is roughly the average cap rate OCF delivers.) You know the rumor that turnkey companies exaggerate numbers and you never get what was written on initial proposal, this is not the case for me. If I calculate my actual cap rate after 6 months by using their convention (Subtracting insurance, tax, property management from gross income) numbers match, thus I am getting what was promised on my proposal. In that regard I can say that they deliver what they promise, there is no sugarcoating in the marketing/offer phase.
+ I’ve surveyed the forum a lot about which are the good parts in Toledo to invest (different people’s views on A, B, C class areas etc.) and I can say that my properties are located in good neighborhoods (one is B class, other one is like A-, B+ish). The neighborhoods that company owner Engelo Rumora describes as “rough” in the forum, they don’t sell houses from those neighborhoods as far as I can observe. In that regard their promise of selling solid B class properties was fulfilled for my deals.
+ Formalities can be taken care of very easily, they are using the online system called DocuSign and you can sign everything online. This way paperwork is very easy to deal with.
+ I am very happy with the property management company as well. They are also very responsive. (PM company is managed by OCF)
+ One of my properties was already tenanted. It has been performing very smoothly, zero unexpected expenses + having the rent steadily in my account every month. Thus that property was like the ideal turnkey experience so far.
+ Renovation of my 2nd property took a bit longer than expected. When the renovations ended, it took some time to find a tenant. But in the end when property managers found a tenant, they have signed a 2-year lease which was good news. Also in the property management agreement it is stated that PM company charges you a month’s rent if they find a new tenant for you. However, due to this delay we’ve experienced and the fact that property wasn’t occupied when I bought it, OCF sales team told me that they waive this “new-tenant finding fee” for me for my first tenant thus I was not charged. They are not greedy. You as an investor also shouldn’t be greedy and it’s a perfect match :) (To prevent a misunderstanding: I knew the property was being renovated and unoccupied at the time of purchase, they've informed me during the offer.)
+ In my 2nd property a well pump issue showed up after the renovations have finished. I roughly had to pay a month’s rent for that maintenance issue.
Expenses like these (maintenance, vacancy) are inevitable in RE business so I deliberately mention them here to give you an idea on what to expect. RE is not a magical business that prints money no matter what. OCF is transparent about this. They help you resolve issues that show up, thus my last two bullet points are not negative feedback about the company. They rather are remarks regarding to nature of RE business.
Some remarks:
+ It looks like as OCF becomes more well-known and establishes itself as a more and more trustworthy company, prices are slightly sliding upwards (cap rates slightly decrease) and threshold to make a deal with them (initial price that you have to pay to buy a house) increases. This is my observation, I may be wrong and would appreciate corrections. Anyways, this is understandable. Initial investors who made deals with them got better deals because there were much fewer reviews available to make sure that OCF is trustworthy. Less known OCF, fewer reviews, fewer investor testimonial videos means investors taking a higher risk while investing with them, thus it is natural that those people were having more appealing deals. Today we’re expected to pay a bit more because we know that we are doing business with a well-established, trustworthy company with a huge online presence. We know that we are taking a smaller risk, which naturally means a higher cost. The reason I am mentioning this is, if you are thinking about buying a house from them, it is very likely that the earlier you buy the better deals you’ll get. (I am not confident when it comes to future-telling thus this is just my naïve prediction)
I am happy to help anyone who is interested in learning further about my experience with the company, you can message me. If this sounded like a shilling post (new member, first post etc) I would be happy to provide ID’s and proof of purchase to forum moderators if needed as well. When I feel like I have enough new info about\experience with the company that is worth posting an update, I may post an update.
Thanks OCF team for starting my RE investment journey.
Thanks,
Ahmet