Cincinnati is an attractive city for real estate investment, with its diversified economy, skilled workforce, and affordable housing prices. As an investment property buyer in Cincinnati, it’s important to understand the local property market conditions, ROI projections, property taxes, and the best areas and property types to invest in. This article provides an in-depth guide for investors looking to purchase investment properties in Cincinnati.
Cincinnati’s strong economic fundamentals support property investment
Cincinnati has a diverse economy spanning healthcare, finance, manufacturing, consumer goods, and logistics. Major employers like Procter & Gamble, Kroger, Fifth Third Bank provide a stable corporate presence. The metro area unemployment rate is low at 3.1% as of Dec 2022. Population and job growth are forecast to be positive over the next decade. All these factors contribute to healthy demand for both rental and owner-occupied housing in Cincinnati.
Look for solid cash flow and appreciation potential
Cincinnati investment property buyers should target at least 8-10% annual cash-on-cash return. Check historical property appreciation too – the metro area saw over 8% home price growth in 2022. Opt for properties near major employers, amenities, and public transit for better tenant demand. Leverage Cincinnati’s relatively affordable home prices to secure properties with positive cash flow.
Understand Cincinnati property taxes
Cincinnati has an effective property tax rate of 1.38%, lower than the Ohio average of 1.6%. Taxes are assessed based on 35% of a property’s appraised value. Investors must budget for annual tax payments on their investment property purchases in Cincinnati.
Focus on multi-family and suburban properties
The most attractive investment properties in Cincinnati are multi-family buildings with 8+ units. These deliver stable rental income with lower per-unit management costs. Newer buildings near suburbs like Mason and West Chester are preferable for their amenities and school districts. Avoid poorer neighborhoods with higher vacancy and property crime.
Cincinnati real estate offers income investors stable cash flow and appreciation upside. Research the market carefully and partner with a local property manager to make the most of your investment.