All Forum Posts by: Steven Aviram

I work for a company that manages over 100 rentals. In my opinion the picture you paint of the typical Cleveland renter is off base.  Our tenants are renters for a variety of reasons.  Many simply don’t want to deal with the hassles of home ownership.  If a hot water tank, furnace, roof, etc. goes bad, the landlord is responsible for it (if they’re a good landlord), not the tenant. Yes, some are bad with finances, and don’t have great credit. Some lost their homes in the housing crisis and didn’t have the credit to buy. Others have very good paying jobs, but may have to relocate after they finish medical school or residency (lots of med students in Cleveland because of the top ranked hospitals). Others are young people just starting out, who don’t want to commit to buying a house yet.  What I’m saying is, there’s really no way to stereotype renters here. 

While I like Slavic Village and think it's got potentIal, I'd bet on an area like North Collinwood, Asiatown, or St. Clair-Superior over Slavic Village.

It's a better than neighboring Maple Heights, but probably worse than most of Euclid.  The further South you go in the suburb, the better it is.  I agree with Federico that the houses South of 480 are better.  However, the only area I'd definitely stay away from is the area off of E 131st, on the far Northeast side of the city, which is actually in the Cleveland School District.

Every investor has their own niche that they like.  Some like suburbs, which have nicer houses and potentially better tenants, but higher taxes and higher property costs.   Others like lower class or middle class parts of the city, where properties are less expensive, taxes are lower, but there may be higher turn over, and more evictions.  Others like something in between.  What area are you most comfortable with?  IMO, the best areas to invest has demographics that you're familiar and comfortable with.  That will give you the best sense of the market, and your customers (tenants).

As others have noted, all of these things depend on the owner, the property manager, and the area.  I work with a company that owns over 90 rentals in the area.  We try to rehab them to get the highest possible rent in a given area.  Below are the answers to your questions from our perspective.

1. We provide all appliances except washer and dryer.  We believe that providing these appliances helps maximize rent, and gets us a higher quality tenant.

2. With the wrong property manager, we had a lot.  With the right property manager, just a few.  It's really up to you to make sure your tenants are being properly screened.  Make sure they can afford the unit, and that they have a clean eviction history before you rent to them and you'll minimize evictions.

3. We usually receive 2-3 (usually minor) calls in the first month they move in.  Once we fix those, they tend to drop off, and then we may only get 1 or 2 for the rest of the year.

4. I'd say around 5-7 on average.

5. On average, I'd say $1,500, but it could be as low as $500 if it's just carpet cleaning and paint touch up, or as much as $4,000 if they trash the place.

Hey Ryan, I'm also an investor in the N. Collinwood neighborhood.  In fact, I think we might've run into each other at Six Shooter Coffee a while back, if I'm not mistaken?  I own 4 properties in the area (lived in one for awhile) and I love it, especially around Waterloo Rd.  I think it's a bit of an undiscovered secret among investors.  It's a bit rough around the edges, but I think in 5-10 years, if we get enough investors committed to upgrading their properties come in, we'll see it start to gentrify like Ohio City and Tremont.

On the topic of Euclid, I think it's a great market for investors.  The company I work for has about 20 houses in Euclid.  Remodeled 3 bed-1 baths typically rent at $1000.  2 bed-1 baths go around $850-$900.  It's a quality lower-middle class city, that still retains a relatively large tax base, with Lincoln Electric headquarters (a fortune 500 company), among other large manufacturing plants.  The only killer is the property taxes.

I think Millenials, my generation, have a different mind-set when it comes to a lot of things, including investing.  We don't just want to make money; want to make a difference in communities that other generations discarded, in favor of bland, car-centric suburbs.  In the past 5 years, I have rehabbed and rented 5 units in an up and coming area of Cleveland.  I'll tell you a little about my approach.

When I look for an investment, I look for an opportunity to do good while doing well.  I like to find properties that are distressed, in areas that have potential, but have a ways to go.  I like properties that I can convert from neighborhood eyesores, to neighborhood assets.  

You could say I'm an idealist at heart, but I don't let my idealism carry me away from the practical aspects of investing.  I stay away from areas that have excessive violent crime, and areas that aren't close to freeways or employment centers.  I look for areas where others are investing in walkable streets, but the investment hasn't hit such a critical mass that I have a ton of competition for good deals.  Finding areas like this is often hard work.  It requires keeping up on the local area's news, attending council meetings, keeping up on what's happening in the city you want to invest in.  But in the end, it pays off, and allows you to be a part of a neighborhood's renaissance, which is rewarding both financially, and personally.

Are there lenders who will do a drive by appraisal, or one based on broker price opinions that won't cost as much as a full appraisal? We only want to take on a small amount of debt relative to value.

I work for a company based in California that owns about 90 single family rentals in the Greater Cleveland area. They were looking to get debt on the portfolio a while back, but found that local banks were very conservative, and needed appraisals on each property individually, which would have been cost prohibitive for us.  Are there any local or national companies that you would recommend for talking on debt for a portfolio like this?

Hi Nicole,

I work for a real estate investor based in San Diego that has over 150 properties in the Cleveland area. I've been working for the past 3 years overseeing rehabs, and managing maintenance on these properties. I also own 5 units of my own. I'm also a real estate agent. See my answers to your questions below:

1) Others are saying to avoid the suburbs as an out of state investor, and I understand where they're coming from. Properties are cheap in the city, taxes are low, and there's no Point of Sale. That being said, having a Point of Sale isn't necessarily a bad thing, as it means the suburbs are generally less blighted than many parts of the city. If you do want to invest in suburbs, I'd recommend Euclid or Parma. Both have relatively inexpensive properties, moderate taxes, good rents, and decent city services and economy. If you do decide to look in Cleveland proper, I'd look at the areas directly adjacent to Euclid (called N. Collinwood), or adjacent to Parma (called Old Brooklyn). Both of these are like slightly less well off continuations of their neighboring suburbs, and don't have excessive amounts of blight or crime.

2) I'd recommend a single family for your first investment. Duplexes are harder to maintain and harder to manage.

3) See #2

4) Feel free to give me a call. I know the market and needs of out of state investors very well, since I work for one full time.