Columbus or Cincinnati for cash flow ?

Question

Hi all! For those investing in OH, if you're primary goal is cash flow, looking at small multi-family, would you invest in Columbus or Cincinnati ? Pros / Cons of each ? I see both are started to get oversaturated with investors. Thank you!

Remington Lyman · Answer

I don't see much difference between Columbus and Cincinnati. I recommend choosing the market where you can assemble the strongest team of four, which should include a realtor, a property manager, a lender, and a contractor.

Patrick Drury · Answer

@Tarek BelalIf your primary goal is cash flow and you want a larger market in Ohio, I think Cleveland is a better opportunity then the other 2 markets from a cash flow perspective. Columbus is a great market, but you are only looking at getting deals to the 1% rule they don't typically go beyond that. In Cleveland, you can find more cash flow, and the price point of entry is lower. The downsides are that there are some D/f locations as well as POS (point of sale) inspections in certain areas.

Nicholas L. · Answer

@Tarek Belal

I'll make it easy for you - there is no cash flow anywhere right now on LTRs.

Drago Stanimirovic · Answer

Hey Tarek , solid question, and both markets have their strengths. If your main goal is cash flow, Cincinnati tends to edge out Columbus with slightly lower purchase prices and higher cap rates, especially in C-class neighborhoods. There's still solid rental demand, and the lower cost of entry helps boost returns.

Columbus, on the other hand, has stronger population and job growth, which can translate into better long-term appreciation and stability , but that often means tighter margins up front.

Both markets are seeing more investor activity, so smart deal selection and local knowledge matter more than ever. If cash flow is the priority, Cincinnati is worth a hard look , just be selective on location and tenant quality.

Let me know if you want help analyzing a deal in either market. Best,

Kristen L Garner · Answer

Hi Tarek! I’ve worked with several investors actively buying in both markets. Here are some of my takeaways. (I do not personally invest here - I invest in Indiana.  This is just what I have noticed working with other investors)

Columbus Pros:

• Strong population growth due to OSU, tech sector, and Intel expansion
• Generally more stable appreciation and tenant demand
• Easier to find newer small multis in decent shape
• Good resale liquidity

Columbus Cons:

• Investor saturation, especially near campus and downtown
• Cap rates are compressing quickly
• City is tightening code enforcement and landlord compliance

Cincinnati Pros:

• Still pockets of undervalued small multis with strong cash flow potential
• More neighborhood diversity means more strategies (BRRRR, Section 8, etc.)
• Slightly easier entry points price-wise
• Strong local tenant base and healthcare job market

Cincinnati Cons:

• Some areas still have lower appreciation and/or weak comps
• More deferred maintenance in older multis
• Need knowledge for PM nuances between neighborhoods

From a purely lending perspective, on DSCR loans - Cincinnati has been having stronger DSCR ratios.

If you’re comparing specific deals and want help running the numbers to compare - feel free to reach out.

Sam McCormack · Answer

Agreed with @Patrick Drury here. I'm not super educated about Columbus or Cleveland, but I do know that Cleveland is better for cash flow. But it normally balances out one way or another.

I'm going to shoot you a message to talk more about this!

Nicholas L. · Answer

@James Hamling

agree, i was oversimplifying to make a point.  i think the key difference is whether it's possible (yes) and whether it's likely (no.)

and, buying a random property thousands of miles away solely because that market has a median lower than yours is not going to get you there.

the days of Brandon Turner pulling up a random duplex in Alaska on Zillow and finding $400 a month in cash flow are long gone.  new investors continue to buy money pits just to "do a deal" and get crushed.

crushed:

Issues with Moldalso crushed:

Sell at a loss or rent at a losscrushed over several years:

Experience of OOS investing in Cleveland after 1.5 years.

crushed at turnover:

$12,000 Turnover!! Is this normal for less than 3 year tenant.crushed from across the entire country:

Baltimore - a path to never-ending pain

Alex Olson · Answer

Yes I agree about Kansas City. Strong cash flow and landlord friendly states and localities.

James Hamling · Answer

I get where your coming from Nicholas but I'm gonna have to differ because I am doing it, and been doing it.

It's not easy, not by a long stretch.

And it's not crazy epic cash-flow day 1. But yeah, 1% deals do still exist, I know because I've done and am doing em.

Now those 1% deals, they sure ain't pretty. Your not getting AAA on those, heck no. Were talking solid D's. But it is what it is. If your with tunnel vision of cash-flow, your playing near the bottom of the barrel that's just how it is.

My A's, we never enter assuming cash-flow from the get-go but man-o-man I have gotten luck a whole lot of times and we've been hitting that mark consistently.

It's small yr1, very small, but a positive is a positive.

And our acquisition's from 3yrs ago people called "dumb"..... Yeah, nobody is calling em dumb anymore. There now doing very nice. Decent reasonable cash-flows and nice little pile of equity built up.

I actually had 1 client just this month on one we acquired just over 36mnths ago asking on Pyramiding because LTV is now about 50%.     Remember how many people 3yrs ago were saying there's no deals to be had n just sit the sidelines?

The best day to buy is always yesterday. The second best is TODAY.

Personally I'd say it's a fools errand to hunt for some mythical cash-flow market. Energy is best spent picking the smart market for the long haul, and then find the deal in that market that works. Divorce, Estate, Retiring Landlord, Relocating for work, Exhausted Landlord, Failed Flip...... The opportunities are endless you just gotta get out there and DIG. They don't throw themselves on a silver platter and beg a person to take em.

Here, I will give out one of my "Secret Recipes" for FREE:

Pick your market of interest. Get property tax records, this varies area to area but I like to use a GIS top down map. I literally go house by house in an organized grid fashion street by street checking owner record of every property.

If it's an LLC, or where owners address for property tax is different than the subject property, I jot it down.

Make a list of the streets your doing, and make your list of "finds".

Next I go to "Professor Google". you'd be surprised how often contact info can be found that easily.

Or, there is a slew of cheap software out there to skip-trace. It can be cents per. Hey, it's not called investing for nothing, so yes, invest in your success, $100 will go a long way.

Then I call em. Yes, I cold call people. Yes, you will have to get comfortable striking up cold conversations if you want to succeed in this business. It's work, remember that, that's why we make $$$$ for doing it.

My pitch, it's really complex: "Hey, I'm so n so and I was just curious about the property _____, I came across it and that's a rental, right? (pause for an answer) Yeah, so I was just wondering, HOWS IT GOING? (pause and let them speak)

"What do you mean how's it going?"

Well, like I said I am a full time real estate professional, I specialize in investment property, I solve investment property problems. So I was just curious how it's going. Maybe life is great and you got the tiger by the tail, I hope so, but if not, I'd love to hear what you got going on. So how's it going????

And you let em talk. And 7:10 times, they will.

And you do this weird thing called have a human conversation with em.

No BS, no sly anything, just be real, be honest, give a dang about them and what they got going on, hear em out, me a shoulder to cry on because heck yeah your gonna get a bunch of "oh that fkn place, oh let me tell you about that dang ______".

And if you have a possible solution, something that may help solve there issues, tell em, ask if they'd be open to exploring if theres a way you could help em out.

No, don't try to "close" them, be a normal human being who solves problems for profit.

People aren't so dumb, if your genuine they will pick that up. If your disingenuous there gonna pick that up too. Just be real.

I guarantee if you talk to just 10 people a day 6 days a week you will get opportunities at deals every week. I did significant $$$$ from exactly this strategy. I still do, when I have time. I've made so many of these calls that now I get so many calls too me I don't have near the time I once did to do these outbound calls.

And they call me because they remember I was the rare genuine guy. I pushed nothing, I was honest, I always try to help even if the help is something I don't make a nickel from.

Because that's legitimately what I do, I help people. My job as a real estate professional is to help people, full-stop.

The more I help, the better I help, the better I make. Focus on what truly matters, the work, not the $$$$. That's my secret to making $, ignore the $, focus on the work and being awesome at it. The $ will follow. Call it financial karma.

This stands true if your trying to be a Real Estate Pro like me, or wholesale, or arbitrage, or just find your own deals because while you may think developing those relationships and helping people doesn't matter, you'd be wrong, who you are matters and building that reputation matters a whole lot. Get known and you'll be known. Deals will then find you.

Drago Stanimirovic · Answer

For strong cash flow over the next 2–3 years, I'd keep an eye on Indianapolis, Cleveland, Birmingham, Augusta, and Kansas City. All are landlord-friendly, have below-average prices, solid rent-to-price ratios, and stable population/wage growth. Let me know if you need help with financing your next project. Happy to help!

Columbus or Cincinnati for cash flow ?

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