Ultimate Logan County Real Estate Investing Guide for 2024

The term BRRRR is a description of a long-term investment strategy — Buy, Rehab, Rent, Refinance, Repeat. BRRRR is a plan for repeated growth. This plan hinges on your ability to extract cash out when you refinance.

You enhance the value of the investment property above the amount you spent purchasing and renovating the asset. Then you take a cash-out refinance loan that is calculated on the larger value, and you withdraw the balance. You utilize that capital to get an additional house and the process begins again. You add income-producing assets to your portfolio and lease revenue to your cash flow.

If your investment real estate collection is big enough, you can contract out its oversight and collect passive cash flow. Discover one of the best investment property management firms in Logan County OH with a review of our exhaustive list.

Factors to Consider

Population Growth

The growth or deterioration of a community’s population is a valuable benchmark of its long-term appeal for lease property investors. If you see good population growth, you can be confident that the area is drawing likely renters to it. Moving businesses are attracted to rising communities providing job security to families who move there. This equals reliable tenants, higher lease revenue, and a greater number of possible buyers when you want to liquidate the rental.

Property Taxes

Real estate taxes, ongoing maintenance expenditures, and insurance directly affect your bottom line. Investment property situated in high property tax markets will provide less desirable returns. Excessive property taxes may signal an unstable region where costs can continue to increase and must be treated as a red flag.

Price to Rent Ratio

The price to rent ratio (p/r) is a clue to how much rent can be demanded in comparison to the acquisition price of the investment property. The price you can charge in an area will define the amount you are able to pay based on how long it will take to recoup those funds. You need to find a lower p/r to be comfortable that you can price your rents high enough to reach acceptable returns.

Median Gross Rents

Median gross rents are a specific yardstick of the approval of a rental market under examination. You are trying to discover a location with repeating median rent increases. Reducing rental rates are a red flag to long-term rental investors.

Median Population Age

Median population age in a reliable long-term investment market should mirror the typical worker’s age. If people are relocating into the neighborhood, the median age will have no problem remaining at the level of the employment base. If working-age people aren’t entering the area to take over from retiring workers, the median age will increase. A vibrant real estate market can’t be bolstered by retired individuals.

Employment Base Diversity

A diversified number of enterprises in the location will increase your prospects for better income. If your renters are employed by a few significant enterprises, even a slight problem in their business could cost you a lot of renters and increase your exposure substantially.

Unemployment Rate

You will not be able to reap the benefits of a secure rental income stream in a city with high unemployment. Unemployed people can’t be clients of yours and of other businesses, which causes a domino effect throughout the market. The remaining people might find their own incomes marked down. Current renters could fall behind on their rent in these conditions.

Income Rates

Median household and per capita income levels let you know if a sufficient number of qualified renters live in that area. Improving salaries also tell you that rental payments can be hiked throughout the life of the property.

Number of New Jobs Created

An increasing job market produces a constant pool of renters. The people who fill the new jobs will require a place to live. This enables you to acquire additional rental real estate and replenish existing vacant units.

School Ratings

The reputation of school districts has a powerful influence on real estate market worth across the city. Business owners that are thinking about moving require good schools for their employees. Moving businesses relocate and draw prospective tenants. Housing prices rise thanks to additional workers who are purchasing properties. Good schools are a vital component for a reliable real estate investment market.

Property Appreciation Rates

Robust property appreciation rates are a requirement for a viable long-term investment. You want to ensure that the chances of your real estate increasing in price in that area are good. Weak or shrinking property value in an area under evaluation is unacceptable.

A furnished property where renters stay for less than a month is referred to as a short-term rental. Short-term rental businesses charge a higher rate per night than in long-term rental business. With tenants coming and going, short-term rentals have to be repaired and sanitized on a consistent basis.

Usual short-term renters are holidaymakers, home sellers who are relocating, and people traveling on business who want more than a hotel room. Anyone can turn their property into a short-term rental with the tools given by online home-sharing portals like VRBO and AirBnB. A convenient approach to enter real estate investing is to rent a condo or house you currently own for short terms.

The short-term property rental venture requires interaction with occupants more frequently in comparison with yearly lease units. As a result, owners manage difficulties regularly. Think about handling your liability with the support of any of the best law firms for real estate in Logan County OH.

Factors to Consider

Short-Term Rental Income

Initially, determine the amount of rental income you need to meet your estimated profits. A glance at a market’s recent typical short-term rental rates will show you if that is an ideal city for your project.

Median Property Prices

When acquiring real estate for short-term rentals, you need to figure out the amount you can allot. To check whether an area has opportunities for investment, look at the median property prices. You can adjust your location search by looking at the median market worth in specific neighborhoods.

Price Per Square Foot

Price per square foot provides a general idea of property prices when analyzing similar units. If you are looking at the same kinds of real estate, like condominiums or individual single-family homes, the price per square foot is more reliable. Price per sq ft may be a fast way to compare multiple sub-markets or buildings.

Short-Term Rental Occupancy Rate

A closer look at the city’s short-term rental occupancy rate will tell you if there is demand in the region for more short-term rentals. An area that necessitates additional rental housing will have a high occupancy level. Weak occupancy rates denote that there are more than enough short-term rentals in that city.

Short-Term Rental Cash-on-Cash Return

Cash-on-cash return is a way to calculate the profitability of an investment plan. Divide the Net Operating Income (NOI) by the total amount of cash put in. The return is a percentage. The higher the percentage, the faster your investment funds will be recouped and you’ll begin receiving profits. If you take a loan for a fraction of the investment amount and put in less of your cash, you will realize a higher cash-on-cash return.

Average Short-Term Rental Capitalization (Cap) Rates

One measurement indicates the value of a property as a cash flow asset — average short-term rental capitalization (cap) rate. Generally, the less money an investment property costs (or is worth), the higher the cap rate will be. If cap rates are low, you can prepare to spend a higher amount for investment properties in that location. Divide your expected Net Operating Income (NOI) by the property’s market worth or listing price. The answer is the annual return in a percentage.

Local Attractions

Big festivals and entertainment attractions will entice vacationers who will look for short-term rental houses. Vacationers go to specific cities to watch academic and sporting events at colleges and universities, be entertained by competitions, cheer for their kids as they compete in kiddie sports, have fun at yearly festivals, and stop by theme parks. At particular times of the year, locations with outdoor activities in the mountains, at beach locations, or near rivers and lakes will bring in large numbers of people who require short-term housing.

When an investor purchases a property under market value, repairs it so that it becomes more attractive and pricier, and then resells the property for a return, they are referred to as a fix and flip investor. The keys to a profitable fix and flip are to pay less for real estate than its existing value and to precisely compute the cost to make it sellable.

You also have to know the housing market where the house is positioned. The average number of Days On Market (DOM) for properties listed in the community is crucial. As a “house flipper”, you’ll need to sell the renovated home right away in order to avoid maintenance expenses that will lessen your revenue.

To help motivated property sellers find you, list your company in our lists of cash real estate buyers in Logan County OH and property investors in Logan County OH.

Additionally, search for the best real estate bird dogs in Logan County OH. These professionals concentrate on quickly finding lucrative investment prospects before they are listed on the open market.

Factors to Consider

Median Home Price

Median real estate value data is a valuable gauge for assessing a future investment market. Modest median home values are a sign that there should be an inventory of homes that can be purchased for lower than market worth. You want inexpensive homes for a profitable fix and flip.

If you see a sharp weakening in property market values, this may mean that there are possibly homes in the market that will work for a short sale. You will learn about potential opportunities when you partner up with Logan County short sale negotiation companies. Learn more concerning this type of investment explained in our guide How Do You Buy a Short Sale Home?.

Property Appreciation Rate

The movements in real property prices in a city are critical. You want a market where home values are regularly and continuously ascending. Volatile value shifts are not desirable, even if it’s a remarkable and unexpected growth. Acquiring at the wrong period in an unreliable environment can be disastrous.

Average Renovation Costs

A careful study of the area’s building costs will make a huge difference in your location choice. Other costs, such as permits, can shoot up your budget, and time which may also turn into additional disbursement. If you need to present a stamped suite of plans, you will need to include architect’s charges in your budget.

Population Growth

Population growth is a good gauge of the potential or weakness of the city’s housing market. When there are buyers for your renovated real estate, the numbers will illustrate a strong population increase.

Median Population Age

The median population age is a clear indicator of the accessibility of possible homebuyers. The median age in the market must equal the one of the usual worker. Workforce can be the people who are potential homebuyers. The goals of retired people will probably not suit your investment venture plans.

Unemployment Rate

If you run across a region having a low unemployment rate, it’s a good evidence of lucrative investment opportunities. An unemployment rate that is lower than the national average is a good sign. When the local unemployment rate is less than the state average, that is a sign of a preferable economy. Without a robust employment base, a market can’t provide you with enough homebuyers.

Income Rates

Median household and per capita income rates show you whether you will obtain enough buyers in that city for your houses. Most families need to obtain financing to purchase real estate. The borrower’s salary will dictate how much they can afford and whether they can purchase a property. You can see based on the region’s median income if a good supply of people in the community can afford to purchase your homes. Look for locations where the income is improving. Construction costs and home prices go up periodically, and you need to be certain that your target clients’ wages will also get higher.

Number of New Jobs Created

Knowing how many jobs appear every year in the area can add to your confidence in a community’s real estate market. A higher number of citizens buy homes if the community’s financial market is adding new jobs. Fresh jobs also entice employees arriving to the location from elsewhere, which further reinforces the real estate market.

Hard Money Loan Rates

Fix-and-flip investors regularly utilize hard money loans instead of traditional financing. Hard money loans enable these buyers to take advantage of pressing investment projects immediately. Review Logan County hard money companies and analyze financiers’ fees.

If you are inexperienced with this loan product, discover more by studying our informative blog post — Hard Money Loans Guide for Real Estate Investors.

As a real estate wholesaler, you enter a sale and purchase agreement to buy a home that some other real estate investors might be interested in. When an investor who needs the property is found, the purchase contract is assigned to them for a fee. The real estate investor then settles the transaction. The wholesaler does not sell the residential property — they sell the contract to buy it.

This method involves using a title firm that’s knowledgeable about the wholesale purchase and sale agreement assignment operation and is capable and willing to handle double close transactions. Discover title companies that specialize in real estate property investments in Logan County OH on our website.

Read more about how wholesaling works from our definitive guide — Real Estate Wholesaling Explained for Beginners. As you go about your wholesaling activities, insert your name in HouseCashin’s directory of Logan County top property wholesalers. This way your prospective clientele will learn about your location and contact you.

Factors to Consider

Median Home Prices

Median home values in the community will inform you if your preferred price point is possible in that location. Reduced median prices are a solid indication that there are plenty of houses that could be acquired for less than market worth, which real estate investors need to have.

A sudden downturn in housing prices might lead to a considerable selection of ’upside-down’ residential units that short sale investors search for. Short sale wholesalers frequently gain benefits using this method. But it also creates a legal liability. Learn more about wholesaling a short sale property from our comprehensive article. If you want to give it a go, make sure you have one of short sale real estate attorneys in Logan County OH and foreclosure attorneys in Logan County OH to confer with.

Property Appreciation Rate

Property appreciation rate completes the median price stats. Many investors, including buy and hold and long-term rental landlords, particularly need to see that home market values in the city are expanding steadily. Both long- and short-term real estate investors will ignore a city where residential market values are decreasing.

Population Growth

Population growth figures are critical for your potential contract buyers. When they find that the community is expanding, they will conclude that more housing units are needed. There are more individuals who rent and plenty of clients who buy houses. A community that has a shrinking population does not interest the investors you need to buy your purchase contracts.

Median Population Age

A friendly residential real estate market for real estate investors is active in all aspects, notably tenants, who turn into homeowners, who move up into bigger properties. This requires a robust, constant employee pool of people who are optimistic to move up in the residential market. A place with these features will have a median population age that is the same as the employed resident’s age.

Income Rates

The median household and per capita income in a stable real estate investment market need to be improving. Income increment demonstrates an area that can handle rental rate and home purchase price increases. Successful investors stay out of communities with unimpressive population salary growth numbers.

Unemployment Rate

Investors will thoroughly estimate the market’s unemployment rate. Late rent payments and default rates are worse in markets with high unemployment. Long-term investors who rely on uninterrupted lease payments will suffer in these locations. Investors can’t count on renters moving up into their properties if unemployment rates are high. Short-term investors will not risk being cornered with a house they can’t liquidate immediately.

Number of New Jobs Created

The number of fresh jobs being created in the region completes an investor’s review of a prospective investment location. Job generation suggests additional workers who require housing. Long-term investors, like landlords, and short-term investors like flippers, are gravitating to regions with good job creation rates.

Average Renovation Costs

Rehabilitation expenses will be crucial to many investors, as they typically purchase low-cost distressed homes to repair. Short-term investors, like fix and flippers, can’t make a profit when the purchase price and the improvement expenses amount to a higher amount than the After Repair Value (ARV) of the property. The cheaper it is to update a unit, the more attractive the community is for your potential purchase agreement buyers.

Mortgage note investors obtain a loan from lenders if they can buy it below face value. When this happens, the note investor takes the place of the borrower’s lender.

Loans that are being paid as agreed are considered performing loans. Performing loans bring stable income for you. Non-performing mortgage notes can be restructured or you may pick up the collateral for less than face value by completing foreclosure.

One day, you could have many mortgage notes and have a hard time finding more time to manage them on your own. At that time, you may want to utilize our directory of Logan County top home loan servicers and reclassify your notes as passive investments.

Should you want to adopt this investment strategy, you ought to place your project in our directory of the best mortgage note buyers in Logan County OH. This will help you become more noticeable to lenders offering desirable possibilities to note buyers like yourself.

Factors to consider

Foreclosure Rates

Performing note investors prefer communities that have low foreclosure rates. High rates might indicate investment possibilities for non-performing loan note investors, but they have to be careful. But foreclosure rates that are high often indicate an anemic real estate market where liquidating a foreclosed home might be a no easy task.

Foreclosure Laws

Investors are required to understand the state’s regulations regarding foreclosure before buying notes. They’ll know if the law uses mortgages or Deeds of Trust. While using a mortgage, a court will have to allow a foreclosure. You simply need to file a notice and proceed with foreclosure process if you are utilizing a Deed of Trust.

Mortgage Interest Rates

Acquired mortgage loan notes contain an agreed interest rate. That rate will undoubtedly impact your investment returns. No matter the type of note investor you are, the mortgage loan note’s interest rate will be critical for your predictions.

The mortgage loan rates set by conventional lending companies are not the same everywhere. Mortgage loans provided by private lenders are priced differently and may be more expensive than traditional mortgage loans.

Experienced investors regularly review the rates in their region offered by private and traditional mortgage companies.

Demographics

A market’s demographics statistics help note buyers to target their efforts and properly distribute their resources. It’s important to determine whether an adequate number of people in the city will continue to have good paying jobs and wages in the future.
Performing note buyers look for homeowners who will pay without delay, creating a consistent income flow of loan payments.

Note buyers who seek non-performing notes can also make use of growing markets. A resilient regional economy is required if investors are to reach buyers for collateral properties they’ve foreclosed on.

Property Values

Mortgage lenders need to see as much equity in the collateral as possible. If you have to foreclose on a mortgage loan without much equity, the foreclosure sale might not even cover the amount owed. Growing property values help improve the equity in the collateral as the homeowner pays down the balance.

Property Taxes

Normally, mortgage lenders receive the property taxes from the borrower every month. This way, the lender makes sure that the property taxes are submitted when due. If loan payments are not current, the lender will have to choose between paying the property taxes themselves, or they become past due. If a tax lien is filed, it takes first position over the mortgage lender’s loan.

If property taxes keep increasing, the homeowner’s house payments also keep increasing. Past due customers might not have the ability to keep paying rising mortgage loan payments and might interrupt paying altogether.

Real Estate Market Strength

Both performing and non-performing mortgage note investors can work in a strong real estate environment. It is critical to know that if you have to foreclose on a collateral, you won’t have difficulty receiving an appropriate price for the collateral property.

Note investors additionally have a chance to generate mortgage notes directly to homebuyers in sound real estate communities. It is a supplementary stage of a mortgage note investor’s career.

Many real estate investment firms are built as a trust called Real Estate Investment Trusts or REITs. REITs are invented to permit average investors to buy into properties. The average person is able to come up with the money to invest in a REIT.

Investing in a REIT is termed passive investing. The risk that the investors are assuming is diversified within a group of investment properties. Investors can unload their REIT shares whenever they want. However, REIT investors don’t have the ability to select particular assets or markets. The land and buildings that the REIT decides to buy are the ones you invest in.

Real estate investment funds are essentially mutual funds focusing on real estate companies, including REITs. The investment assets aren’t owned by the fund — they’re owned by the companies the fund invests in. Investment funds may be an affordable method to combine real estate properties in your allocation of assets without unnecessary liability. Fund members may not collect ordinary distributions like REIT shareholders do. As with any stock, investment funds’ values increase and decrease with their share market value.

Investors can choose a fund that focuses on particular segments of the real estate industry but not particular markets for each property investment. Your choice as an investor is to pick a fund that you rely on to handle your real estate investments.