The Ohio houses will cash flow. Long Beach will not.
Do you want to deal with 10 tenants who can only afford to live in cheap houses or one or two who can afford to live in expensive houses? Do you want to maintain 10 cheap houses or one expensive house? Do you want to likely earn 100’s of thousands in appreciation on the expensive house or 10k-20k each on the cheap houses?
Wow, Those are really good questions. I think the expensive house is the way to go. I would be worried an empty expensive rental but seems unlikely in longbeach
Years of investing experience. Many people start out with cheap houses because that is all they can afford. I did. many soon find out it is not the way to go when you can afford better property, like I did.
Bit of context here. A duplex in long beach may cost 5x more than a SFR in Ohio but may not attract the best quality tenants. Are you buying in cash? If not can you cash flow the LB duplex? My vote is for Ohio suburbs. I don’t own any rentals in California because the cash flow is poor and tenant laws are strong. Plus, you’ll be a month vacancy or one tough eviction from straining your personal finances. Multiple properties that are cash flow positive insulate you from the normal vacancies and maintenance expenses.
If you can get the same revenue with 90% less work? I think the question answers itself.
I have a client who owned a bunch of cheap strip malls.
He told me that was his biggest mistake as many of those tenants are worst of the worst (some are good tenants of course).
Same here, my biggest mistake by far (PITA, not necessarily financial) was buying a distressed strip mall. Not worth the hassle.
I’m trying for mid tier homes in moderate sized metro areas. So still cheap compared to CA, but not cheap for the area.
Hold on let’s talk about expensive compared to cheap. The Ohio market is totally different and cheap in Ohio compared to California is not apples to apples. A $250k duplex in Ohio is a Castle and in the right location can draw too dollar. A simulate return in Ca could be a 1.5 million property. Also from the posts on other Landlord type subreddits the laws in Ca are crazy in favor of Tenants and how can you even survive dealing with that setting you back. By the way I am biased living in NE Ohio with 4 single family rentals.