I started spending a lot of time researching new rental markets for myself and recently came across Parma, OH. In this post I'll share some insights based on my findings and some data to showcase why this market is a great opportunity.
About This Market: Parma, Ohio boasts a stable population driven by affordable housing prices relative to national averages. The local economy is supported by several diverse sectors including healthcare, manufacturing, and retail, which sustains employment levels and underpins rental demand. Additionally, Parma's proximity to Cleveland enhances its appeal, offering easy access to urban amenities and employment opportunities without the higher living costs associated with larger cities. This combination of affordability, economic stability, and location makes Parma compelling in my research.
Taking a deeper dive into the rental market here, I thought this could be a unique investment opportunity because despite a seemingly low occupancy rate of 23.90%, the rising rental rates highlight a robust demand for single-family homes (SFH), presenting a lucrative avenue for investors like us.
The Key Growth Indicator: A significant uptick in SFH building permits during 2022 and 2023 screams a burgeoning market ripe for investment.
Property Highlight: Zooming into the zipcode of 44134, let's take a look at a promising investment in a SFH I found.
3104 Liggett Dr, Parma, OH 44134
On this property, I calculate an ARV estimated between $107,000 and $115,000.
If you make a strategic offer of $70,000, complemented rough $30,000 renovation investment, you position this property as a prime rental candidate and can command rents between $1,100 and $1,200 monthly.
This scenario forecasts a potential 9.85% cash-on-cash return for an all-cash investment.
Additionally, with a more extensive renovation, the property's resale value could surge above $200,000.
This is just one example but the above data showcases its potential as an excellent market for single-family home investments. As I've peeled back the layers through data-driven insights on more homes, the opportunities for substantial returns are clear.
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