All Forum Posts by: Michael S.

@Gaston Chavarin

I would skip that one. My experience with Toledo small multifamily has taught me a few things. Be very focused on the criteria you set out for these properties. The right neighborhoods, the right zip codes, separate meters, property conditions, existing leases, rent readiness, etc. Here’s an example of what I set for 2-4 unit criteria in Toledo:

• 2-4 Units Criteria – Rent Ready ~ $20,000 - $25,000 per unit. Target rents $585+ per month per unit. May consider right value-add opportunity with creative financing / owner financing. Separate meters: Gas, Water, Electric. If we must pay water, or gas, price must reflect discount to meet $200 door free cash flow. Account for utilities. For utilities back out a 14 CAP impact on premium value; Gas $1344 annually / 0.14 = $9600 down adjustment for offer price. Neighborhoods: Deveaux, Franklin Park, West Gate, Elmhurst Elementary, and Washington Local School District. Deal must pass analysis looking for $200-$300 per door free cash flow.

I personally think the right SFR is the way to go in Toledo. There is plenty of opportunity and value in Toledo.

@Jibril Walker find out who the wholesalers are in Toledo. Identify them and figure out how to add value for them. Build the relationship, add value, and learn from a successful wholesalers in Toledo. Call the Bandit Sign Numbers, Look at the "We Buy Houses" Craigslist Ads, Check the BP Marketplace and see who has houses up in Toledo. Identify your potential mentors and get the knowledge from them. Keep the $300 and keep stacking. @Paul Parker do you have any advice on this subject?

@Nina Sachdev the process was interesting. I studied and analyzed for a year and a half. I was certainly in analysis paralysis mode. One day I just started taking action. The decision was made and it was just time to take action. The fear was still there. The unknown still existed. It could all blow up in my face. All I knew was that it was time. Through all the study, and all the metrics, I picked a market (Toledo OH) that the data would've dissuaded me from. The numbers worked and I picked a duplex and went for it. Then a single family came up and I went for that (the ink barely dried on the duplex closing). Then it was off to the races to 23 doors across 7 properties. Looking back, the duplex wasn't the best deal (paid gas and water). There are plenty of things I've learned along the way. The most important thing I learned was to take action. Also, focus on your Why and avoid shiny object syndrome. Decide what you want to be and master that approach (buy and hold, flipper, wholesaler, multifamily, commercial, etc.). 

@Mike Dami we invest in Toledo and so far we've seen good results. I have the pleasure of owning: SFR, Duplex, 4 Plex, and two 6 units. Each category has it's nuances and potential pitfalls. Sure, we look at all the typical market metrics: employment growth, population growth, wages, unemployment, etc. In the end we selected Toledo because we have a good team on the ground and we expect the city to finish turning around with the investments and revitalization efforts. They still have a ways to go to reverse population growth trends. Oh yeah, and CASH FLOW! I could write a dissertation on what we've learned so far. We're out of state investors and will continue to build out our portfolio in Toledo for at least 20 more doors. Feel free to reach out or PM me for any additional info.

@Jacob Morris I second @Sam B.'s recommendation for @Andrew Fidler. He's done great work for myself, my brother, and a close friend of mine. He's knows the market and how to navigate the nuances. AS for lenders, you should be able to get 20% down and 30 years. PM me and I can put you in touch with who we use. Feel free to reach out if you think I can be of value.

@Andrea Tavake from a distance, flipping in Toledo might not get you the returns you're looking for. This is in my experience and opinion only. We've found that Toledo is a market better suited for buy and hold with a cash flow focus. We are targeting 3/1 SFRs in the $40k-$50k range with rents between $700-$800. It is a long-term strategy to build income streams and not worry about appreciation. Any appreciation is gravy of course. Toledo is a linear market for the most part. It will likely get consistent minor appreciation numbers over the long-term. We did a couple "flips" and figured out that the profit wasn't worth the aggravation. Of course, this is from my perspective and situation. You can accomplish what you set out to. You have to build out the right team on the ground and get great deals in neighborhoods with owner occupier/retail buyer demand. You also have to time this out so you are not selling in the middle of winter. If I was going focus on flipping in Toledo, I'd focus on Franklin Park and Washington Local Schools. I'd also look at the longer term hold plays around the revitalization efforts of downtown and the Marina District.

@Andrea Tavake I live in San Jose and own several properties in Toledo. @Daniel Kramer has given some good insights. I'm focused in on 43612, 43613, Washington Local Schools. In the future I will add in some 43623 and Franklin Park. @Karla Parker good to see a few folks from the Bay investing in Toledo.

@Eriko Yoshimaru yes, @Andrew Fidler and his team manage properties for us in Toledo. They do excellent work and helped educate us about a lot of the idiosyncrasies of the market. They made the difference in my market selection to start. There's plenty of cash flow potential in the right neighborhoods with the right property types (at the right price). We are looking to add about 20 more doors in Toledo working with Andrew and team. That will put us at 40 doors in the market.

@Drew A Roque I'd pay off the debt. This is coming from a guy who doesn't consider student loan debt as bad debt. I see it like this, if you keep the debt you have a liability you need to account for each month. Knock it out and keep that money in your pocket to invest with more velocity down the road. If you bought a property now, would it's cash flow be consumed to cover the debt? Spend the 4 months, Study and learn, then go and crush it!

@Bryce M. my first investment was a duplex with Sec 8 downstairs and traditional tenant upstairs. From day one upstairs was a pain. Each month was a new story about my rent being late or short or something. Downstairs Sec 8, no problem whatsoever.

There are good tenants on Sec 8 and bad tenants on Sec 8. There are good traditional tenants and there are bad traditional tenants. Try not to let the urban legends, stereotypes, and hasty generalizations cloud your decision-making.

I have several Sec 8 tenants. Not once have I heard a sob story about why my rent is late. I insure my properties are up to standards, and I have a mandatory inspection every year. I see these as good things. There’s extra upfront work, and the bureaucracy can be irritating. However, my outcomes have been stabilized units with a predictable direct deposit on the 1st of every month.