Lima Ohio Investment Property

[Matthew Swearingen]

My ex father in law bought a rental in Lima. Here's some of the info I have:

4 bed 2 bath 1699 sq ft purchased July 2018 $78k and after closing costs $80, 611. As of now the balance is $60,820. 

It rents for $900. Rental management take first months rent then 10%. So rents come out to $810. I'm just doing a rough estimate but a 30 year at 3.9% gives a payment of $378. 

Zip code for this home is 45805 on Hazel Ave.

What are your thoughts on opportunities in this area. Ive looked in Chattanooga, Memphis so far but not sure. Any thought guys and gals.

[David Young]

Matthew,

  I live near Lima and invest in the area. There is a smaller tenant pool than a larger city, but the supply of rental properties is slim compared to the demand. The last rental property I had with a vacancy had a new tenant lined up within a week.

For property management, I would recommend Hartsock Realty Property Management. 

That area of town on Hazel is a C- class neighborhood, so I wouldn't expect you to be able to increase the rent that much over time. Lima is a great market for rentals due to the high percentage of people who rent and low cost to purchase properties. Like any town, there are neighborhoods you want to stay away from due to the high crime/drug/vacancy rate, but the opportunities are there.

Another note, a good strategy in Lima right now is college rentals. University of Northwest Ohio is only a few miles from Hazel. The school has been growing beyond what they can provide in housing, so they frequently send students off campus and provide them with a voucher for housing. You can typically rent by the room and get 300-400 per room, which would be an ideal way to capitalize on a 4 bed house. Students are going to want a house with a garage and parking space, as most of the students go to UNOH for their automotive, diesel, and high performance motorsport technology programs.