Jocelyn,I would look over off electric,north of schrock area,you have affordable homes,where your rents could be met,and the schools are close etc,Good hunting to you.If its a condo,make sure you can rent in their by-laws.

Regards;

TJ

In the simplest explanation... Where would you want to live? Have your kids go to school? or work? The best areas to buy rentals for long term investments, will be areas that are the most desirable to purchase as well. These areas will then produce tenants quickly, allowing you to get top dollar... Supply and Demand. Personally I buy mine in Westerville. Good luck in your search...

Also, make sure the cap rate is greater than or equal to the interest rate for the financing; the greater the spread, the better off you'll be. This is called positive leverage.

On the other hand, if the cap rate is less than the interest rate, then you'll lose money--no matter how high the cap rate is. This is called negative leverage. Negative leverage isn't necessarily a bad thing--especially if you intend to invest long-term. As your equity continues to build up (via your mortgage payments and appreciation), that negative leverage will eventually transform into positive leverage.

Nevertheless, IMHO it's always better purchase investment property using positive leverage.

Jocelyn:

This is a difficult question to answer without additional information. How much are you looking to invest? There are various levels of the market for homes that are used as rentals. There is a nice market for the $600-800.00/month rentals in Clintonville, Campus and the Grandview area. You could purchase a duplex and rent each side in this range.

There is a market for single family home rentals in the $1,000-$1,500 range in the suburbs.

Have your Investment Realtor compare the rentals vs purchase prices in several areas you might be interested in. You will see "CAP RATES." This capitalization rate is figure on NET income. The higher, the better, of course, except that risk might also increase with high rates; while the lower cap rate might give you greater appreciation. After learning about this, you can apply more detail to specific properties.

In any event, this investment path is one of the best now (Ask anyone about their mutual funds that their broker touted as safe.) . Columbus is also one of the best areas now for higher Cap Rates and STABILITY -very important in highly leveraged investing.

Before purchasing a rental, you need to do some research.

First, you need to determine what kind of return on investment (ROI) you'd like to receive. Stated another way, you need to take a moment to think about how much you'd like to earn from the rental (aka the cashflow). Basically, cashflow is to real estate as a dividends are to stocks. Professional investors use the ROI (and other metrics) to compare the performance of multiple investment products (stocks, bonds, forex, real estate, etc), and to determine whether the yield (the cashflow or dividend) is worth the effort to acquire that investment product.

Second, you need to consider how involved you'd like to be with the rental. Do you intend to manage the property and handle the repairs by yourself? Don't make a rash decision simply to scrimp. You may find you'll save more money, effort, and time by hiring professionals to do the work. For example, if you intend to acquire multiple properties, and if you like to travel, then it might make a lot of sense for you hire those professionals: the goal here is hassle-free ownership. On the other hand, if you don't intend to acquire lots of properties, and if you enjoy doing the repairs and interacting directly with your tenants, then it makes more sense for you to become the professional (and to not hire them).

Third, after having determined your desired ROI and level of involvement, you need to collect some data: the median sales price (for single-family homes in the area you plan to acquire the rental), the absorption rate, the days on market, the vacancy rate, and median income. You can use this data to help to (dis)qualify a particular location. Ultimately, you'll need to evaluate each potential purchase with an income analysis to determine whether your rental is in a location with sufficient demand and ample resources to satisfy your bottom-line (ie your desired ROI and level of involvement).

Jocelyn,depending on the property location,and mainly the price you can buy for,the #'s have to cover your mortgage,etc...I'd be glad to work with you.

Thx,

TJ