William and Jenny admitted they’d been thinking about building a real estate investment business for some time, but something always seemed to throw them off track. They both got promoted at work, the twins were born, then they decided to renovate their Far North home. Now that they finally felt ready to and end the corporate grind and start their careers in real estate investing, they were concerned that the market for flipping houses in Columbus, Ohio had cooled. Frustrated that they were, yet again, going to be thrown off track, they stopped by with the kids to ask for advice. Their timing was perfect; my own son had just been asking when he’d see their kids again.
The Market for Flipping Houses in Columbus, Ohio
William and Jenny’s concerns about the Columbus real estate market aren’t entirely unfounded. It’s not so much that the market has cooled, but that it’s gotten so hot. In more than 20 distinct communities in Central Ohio—including five areas located within Columbus—you could expect to make a good living buying, renovating, and selling houses last year. By April of this year, Realtor.com named Columbus the fourth hottest real estate market in the country, a ranking that’s based on where homes are selling the fastest. So, by all indications, people are lining up—and paying up—to buy houses here. For real estate investors looking to enter the Columbus market, that should be good news, right?
Well, the problem with a real estate market that’s hot, and seemingly growing hotter, is that it can start to look like the most lucrative point of entry for investing has passed. As demand for housing increases, median home sales prices typically spike and inventory usually drops. And, Columbus is no exception to this trend. Median home sales prices have increased by 9.3% since February of 2017 and inventory decreased by more than 20%, reported The Business Journal in March. While this is good news if you bought and rehabbed homes last year and are selling your investment properties this year, finding good deals amongst less inventory today seems less promising.
With an ever-shrinking local inventory, you might be wondering if the opportunity to buy houses to renovate and sell for decent returns has shrunk as well. After all, neighborhoods throughout North, Northwest, and South Columbus, in addition to nearby metro areas like Bexley and Upper Arlington, are all in high demand with buyers—and that demand isn’t showing any sign of slowing down. Coupled with unemployment below the national average at 3.5%, according to the Bureau of Labor Statistics, and wage growth in all of Franklin County currently keeping up with rising home prices, buyers can afford to have their demands met. So, finding and investing in good deals is likely to get that much more challenging.
One of the biggest threats to turning house flipping into a good business is paying too much for a house or its renovation. In markets where there is a kind of feeding frenzy happening among buyers, like Columbus, you risk falling prey to the same enthusiasm—or desperation—and can make one or both of these mistakes. Making good property investment decisions requires that you keep a cool head so that you can stick by the numbers when making offers, even if it means you ultimately miss out on a deal. Otherwise, you jeopardize your potential returns.
That’s why you should be looking for off-market properties owned by individuals and families looking for an easy way to sell fast. If you’ve got a good real estate lead generation system in place, you can find those deals regardless of market climate. Of course, that’s part of what’s rewarding about investing in Columbus real estate. It’s not just that opportunities exist to flip houses if you know where to find them, it’s that, when you do find them, you also have the opportunity to sell your investment property at a rising price point. Getting leads on distressed homes is the crux though, isn’t it?
The Right Team Can Make it the Right Time to Invest in Columbus
As I talked with William and Jenny about gaining entry into our hot real estate market, I was reminded of the time when I first started flipping houses in Columbus. It was long before the housing crash and I worried that my timing was off too. But, by choosing to become an independently owned and operated HomeVestors® franchisee, I quickly learned that the right lead generating strategy can make it the right time to invest anywhere.
The rewards of franchising help mitigate the risks of investing. Not only did I receive all the training I needed to learn how to invest wisely, but I gained access to a variety of proprietary tools and resources. The nationally-known and trusted “We Buy Ugly Houses®” marketing campaign, for instance, helps financially-distressed homeowners find local franchisees, like me. It’s so successful that franchisees have bought over 100,000 houses since 1996.
Call HomeVestors today to see how you can start flipping houses in Columbus with the “We Buy Ugly Houses®” team.
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