Summary: In this article, find out if Ohio is a good place to invest in real estate right now. Topics include the current state of Ohio’s economy, Ohio’s real estate markets and housing trends, and the best places in Ohio to invest in real estate in 2021. If you’re interested in learning about the Ohio housing market, this article is definitely for you. Enjoy!
Introduction to the Ohio Housing Market
Ohio is located in the Midwestern United States and is the seventh-most populous state in the country. Rated as one of the best states for business, Ohioans enjoy a low cost of living, good schools, and a variety of recreational activities and attractions in cool cities.
Known as the Buckeye State, Ohio is home to the Rock and Roll Hall of Fame, National Museum of the US Air Force, Cedar Point Amusement Park, Hocking Hills State Park, Amish Country, Columbus Zoo and Aquarium, Cincinnati Museum Center, Franklin Park Conservatory and Botanical Gardens.
Seven US Presidents were born in Ohio. The first ambulance service started in Cincinnati in 1865. It’s the first state to pass laws protecting working women. Ohio offers a lot to sports fans. In fact, the first professional baseball team was the Cincinnati Red Stockings. Now, Ohio’s sports teams include the NFLs Cleveland Browns, the NBAs Cleveland Cavaliers and the Ohio State Buckeyes.
Two of the top 10 cities for new college graduates in 2020 are located in Ohio–Cincinnati and Columbus. The largest cities and the surrounding areas are seeing the most population growth. It’s also easy to get around. Ohio has established a good public transportation system in their larger cities around the state.
Ohio has the seventh largest economy in the country. Manufacturing and finance are two of the biggest industries. It produces the largest amount of plastics, rubber and fabricated metal than any state in the US.
Before we get into where to invest, let’s take a quick look at the current state of Ohio’s economy and how it’s been impacted by COVID-19.
The Current State of Ohio’s Economy & the Impact of COVID-19
When the COVID-19 pandemic hit, nearly 900,000 Ohioans lost their jobs. Since then, the state has regained about half of those jobs back. The sectors adding the most jobs are leisure and hospitality, trade, transportation and utilities, and heath and education, respectively.
There is positive momentum for a recovery in Ohio despite COVID-19. Overall, the population is growing–particularly in larger cities. Ohio has a big and diverse job market, coupled with affordable housing and a low cost of living.
The Ohio Real Estate Market in 2021
When considering any housing market, there are three main indicators: is there 1) population growth, 2) lots of jobs, and 3) affordable housing? If a real estate market has these three indicators, it’s likely a good place to invest.
Ohio Housing Market Trends
People Are Moving There
Around 11.8 million people live in Ohio and in the last 10 years, the population has steadily grown at a rate of 1.81%. While this growth is slower than the national average, it’s still solid growth.
A trend worth paying attention to is Ohio’s aging population. In the next five years, more than 1 in 4 Ohio residents will be 60 or older. It will be interesting to see how this will impact Ohio’s housing market in the future.
Regardless, the most growth is happening in cities like Cleveland, Cincinnati and Columbus. These are the places home values could appreciate the most.
The Job Market is Growing
Ohio has one of the biggest economies in the country. It has 25 Fortune 500 companies and 338 colleges and universities. The largest employers in the state include: Wal-Mart, Kroger, and the Cleveland Clinic. The healthcare industry also employs a huge number of people in Ohio. Employers like Mercy Health, University Hospitals, OhioHealth, Cincinnati Children’s Hospital and more.
In 2020, Ohio was ranked #9 as America’s top states for business. It has one of the highest rated infrastructures and a low cost of doing business. A growing job market and economy is always a good sign for a healthy housing market.
Affordable Housing & Cost of Living
Compared to the rest of the U.S., Ohio is very affordable overall. Affordability and a low cost of living are two of the things that attracts people to Ohio most. In fact, the average mortgage payment in Ohio is $765 per month, which is significantly less than the national average of…. About 35% of the population rents and median rents are roughly $600 a month.
All throughout Ohio there’s a shortage of affordable rental housing for low income families. This lack of low income housing is a trend that the rest of the country is seeing as well. This could mean an investment opportunity for Section 8 landlords.
Best Places in Ohio to Invest in Real Estate
The best places to invest in Ohio in 2021 include Cleveland, Cincinnati, Columbus, and Dayton. Each of these markets has a variety of pros and cons for investment. Learn more about each market below.
You may also like: 18 Best Places To Buy Rental Property (In the Entire U.S.)
Investing in the Cleveland, Ohio Real Estate Market 2021
The Cleveland housing market is one of the most popular places to invest in real estate in the nation, and it’s not hard to understand why.
Cleveland has grown a lot since 2000 with Millennials being the largest demographic moving to the city. Located on the banks of Lake Erie, Clevelanders enjoy lakeside views and a number of cultural attractions.
Downtown Cleveland has undergone a $50-million redesign over the last few years. The project includes acres of green space surrounding Public Square, apartment and commercial buildings and other amenities.
The city’s most popular cultural attractions include the Cleveland Museum of Art, MOCA Cleveland (the Museum of Contemporary Art) and the Rock & Roll Hall of Fame.
Cleveland’s job market offers high-paying jobs in industries such as IT, healthcare and manufacturing. In fact, there aren’t enough qualified people to fill these open positions. However, the Coronavirus outbreak hit Cleveland’s job market and economy hard. The most job losses were in service and accommodation, professional and business services, and health care.
A large part of Cleveland’s economy is dependent on the healthcare industry, so when job losses in this sector spiked in April, there were reasons for concern. Since then, jobs in healthcare have increased and continue to gradually do so.
The price of an average home in the Cleveland metropolitan area is about $167,000. Values have gone up 7.9% in the last year and are expected to go up another 5.1% in 2021.
Located just 45 minutes from Cleveland, Akron is known as the “Rubber Capital of the World” due to its long history making tires. The University of Akron has a bit of a college town vibe, has its own zoo, and several unique neighborhoods.
The average home price in Akron is around $80,000. Since last year, home values have gone up 8.6%. And projected values to increase 8.2% over the next year. Certain neighborhoods in Akron present a great opportunity for cash flow and appreciation.
Parma is a large suburb of Cleveland, with median home prices of $140,000. Homes are more expensive in Parma, but they’re still way below the national average. Plus, home values have appreciated 9% over the last 12 months, and are expected go up another 8.2% in the coming year. More people own their homes rather than rent.
A densely populated area, residents of Parma enjoy a mix of bars, coffee shops and parks. It’s also known to have good public schools. Average rents are $850, which makes Parma an extremely affordable place to live.
Located at the mouth of the Black River, Lorain is a suburb about 45 minutes west of Cleveland. It’s located right on the edge of Lake Erie with average home values just over $86,000. In the last year, homes have increased by more than 7% and are projected to go up by more than 8%.
Rents in Lorain are around $650, making it one of the most affordable places to live. This Cleveland suburb is a good place for families to live, with good schools and lots of parks.
To learn more about investing in Cleveland, view our Cleveland real estate market page. To view sample investment properties in Cleveland, become a member of RealWealth. It’s 100% free and only takes 5 minutes.
Investing in the Cincinnati, Ohio Real Estate Market 2021
Cincinnati topped the list as the best city for recent college graduates in 2020 in terms of jobs, affordability and fun. It claimed the #1 spot for the second year in a row and has maintained a relatively low unemployment rate throughout the COVID-19 pandemic.
This time last year, the unemployment rate in the Cincinnati metro area was 3.6%. Nearing the end of 2020, the unemployment rate is 6.9%, compared to 7.7% nationally. On a positive note, the workforce in Cincinnati is projected to increase by more than 6% over the next decade. More jobs means more people.
There’s been an influx of people moving to Cincinnati over the last decade. The population growth isn’t the fastest in the country, but it’s steadily growing. And with a healthy and expanding job market, it’s likely the trend will continue.
The average home value in the Cincinnati metro is $201,822 (as of November 2020). In the last year, the value of homes has increased 7.7% and a rise of 5.9% is expected over the next year. Cincinnati is a super affordable city, especially stacked up against other larger cities around the country.
A big student population drives a strong rental market in Cincinnati. Around 55% of people rent, and the median cost of rent is below the national average. The housing market around the Cincinnati metro area presents a unique opportunity for real estate investors. Cash flow and long-term appreciation is possible in certain neighborhoods throughout Cincinnati.
Investing in the Columbus, Ohio Real Estate Market 2021
Columbus is the capital of Ohio and the most populated city in the state with over 922,000 residents. Number five on the list of top cities for college grads, Columbus offers affordability, a rising Millennial population and wide offering of fun activities for everyone.
The Ohio State University is located in Columbus and one of the largest employers in the area. Prominent industries in the Columbus metropolitan area include health care, government education, IT, Insurance, retail and finance.
Major employers in Columbus are JPMorgan, Nationwide Insurance, Honda of America and American Electric Power. Median household income in the Columbus metro is around $68,000, which is above the national average.
The price of an average home in the Columbus metropolitan area is $223,000. Values have gone up 7.6% since 2019 and are expected to increase 5.8% over the next 12 months.
To learn more about investing in Columbus, view our Columbus real estate market page. As mentioned above, if you’d like to view sample investment properties in Columbus, become a member of RealWealth. It’s free and signing up takes less than 5 minutes!
Investing in the Dayton, Ohio Real Estate Market 2021
Dayton is home to almost 139,756 people and is located between Columbus and Cincinnati. Home values in Dayton are around $68,000. They have gone up an impressive 16.3% since last year and are expected to rise nearly 9% in the next year.
Most residents in Dayton rent their homes. On average people are paying just under $700 per month in rent. Dayton attracts young professionals, offers an active nightlife and tons of diversity. The National Museum of the U.S. Air Force is also located in Dayton.
Canton is about an hour from Cleveland and 30 minutes from Akron. It has a population of 70,000 people and is a good place for families to live. Fun fact: Canton is home to the Pro Football Hall of Fame.
Average homes in Canton have increased almost 8% since 2019 and are currently $117,000. Home values are expected to increase 7.7% in the next year. Rents are under $600 per month on average, which makes Canton another extremely affordable place to live.
So… is Ohio a good place to invest in real estate in 2021 and beyond? Hopefully, this article helped you decide if it’s a good option for you. All in all, there are definitely great opportunities for cash flow and appreciation throughout the state, particularly in areas that are growing in population and jobs. Even in the largest Ohio cities, you can find affordable housing and a relatively low cost of living.
Interested in learning about markets other than Ohio? Check out the top real estate markets around the U.S.