DISCLAIMER: This article is meant for educational purposes only and is not intended to be financial or legal advice. If you are considering flipping houses in Ohio, HomeLight always encourages you to reach out to an advisor regarding your own situation. Flipping houses can be a profitable venture — whether you’re interested in a fun side gig or a full-time job. And according to top agent and real estate expert Heidi Jenkins, Ohio is a great state in which to practice your craft. Not only does Ohio have the seventh-lowest cost of living in the country — the cost of living index considers 100 to be the national average and Ohio sits at 89.4 — but the state’s home values continue to increase. Ohio home prices are up 10.2% over the past year, and population growth is consistent at a rate of 0.67% annually. When considering where to flip houses, a state that has both a growing population and rising home values is generally a good sign. After all, someone needs to buy that house you’ve just renovated, and your chances of a quick sale — at a desirable price — are much higher in a location where people want to live. With the help of Jenkins, who specializes in investment properties, we’re digging into the nuts and bolts of flipping houses in Ohio — so let’s get to it! House flippers buy homes, hold them for a couple of months, and then sell them for a profit (that’s the flip part). Typically, they buy distressed properties — either short sales, foreclosures, or homes that need significant work — fix them up, and sell them for a profit. Sometimes flippers buy and sell homes to wholesalers without making any repairs or updates. The goal is to buy low and sell for a high profit — one that covers both the home’s initial cost and any improvements. In Ohio, “people are still flipping houses, people are still trying to find a deal,” confirms Jenkins. “Some people are in a position where they have to sell, and that’s helping people who are looking to flip get a pretty good deal.” Jenkins also notes that now is a great time to buy and hold a property — as opposed to renovating a house and selling it immediately. “I feel like buying and holding is going to be more common than flipping right now, just because buyers are having to borrow and interest rates are a little higher right now.” Though lots of houses were flipped in 2022 — the most since 2000, actually — profits weren’t as high as sellers may have hoped. That being said, we are on the heels of a pandemic that has changed nearly everything as we know it, including real estate. As any experienced agent will surely advise, Jenkins says that the key to profitably flipping houses in Ohio is “making sure that you’re getting a good price and that the numbers make sense. The biggest mistake is when people don’t know what they’re doing, they don’t have a budget, then they end up with less than they would have liked.” In other words, don’t expect to play it by ear and make a big profit just because you put a few extra dollars into renovations. It’s always difficult to put a concrete number on profits when it comes to real estate — every transaction is different. How much you’ll make flipping houses in Ohio depends on a number of factors, including: According to Attom Data, the nationwide median resale price for flipped homes in the third quarter of 2022 was $310,000, yielding a 25% profit margin. Opportunities for flipping homes can be found throughout Ohio, and Jenkins actually says there is no one particular area she would consider “the best,” because, as she reminds us, “it’s all about the numbers.” That said, here are a few cities in Ohio that, based on growth and/or increases in median home values, could be a smart place to start your search. Cleveland’s median home value is $111,195, up 10.1% from December 2021. The population — currently 351,000 — has been on a decline, but has risen 0.06% in the past year, making this city one to watch for profitable house flipping. With an affordable median home value of $120,407, which is up 12.4% from December 2021, Maple Heights shows real promise for home flippers. The modest population of 24,000 is growing at an annual rate of 0.23%. This Ohio city has seen a steady rise in its median home value — up 8.4% from December 2021 for its current position at $127,286. Population growth is happening as well, with just 5,500 growing at a rate of 0.38% annually. Toledo sits at the western tip of Lake Erie and has a population of 265,969, making it the fourth-largest city in Ohio. It has an attractive, easy-in median home value of $110,753 — up 10.4% from December 2021. Following Toledo, Akron — which spans over 62 miles — is the fifth-largest city in the state with a population of 187,877. Akron’s median home value is $119,145, up 12.3% from December 2021. Unless you’re a licensed contractor, you’ll need a network of professionals to help you flip. Even if you’re handy around the house, evaluate your skills honestly. For some projects, particularly electrical and plumbing, you’ll need an expert. Keep in mind that buyers may be wary of purchasing a flipped home if they can’t verify that permits were pulled, and the work was done by licensed professionals. Put together a network of experienced, licensed professionals before you start scouting houses. In addition to people to perform the remodeling work, you’ll need an agent to find homes, a stager to help sell them, and possibly a lawyer to draw up legal documents. If you’re new to flipping houses, Jenkins encourages you to be realistic when it comes to acknowledging your skill level. It’s better to invest in the work of a professional than to cut corners and scare off potential buyers when the house hits the market. “My husband and I do a lot of the work on our flips. I love doing tile — he’ll cut it and I’ll lay it. I love to paint, he hates it,” says Jenkins. “But we do pay someone to handle plumbing, furnace, carpet; things like that.” A budget that takes into account all repairs, fees, and the unexpected is a key piece to successfully flipping a home. But, how do you account for the unexpected? Since flippers don’t have a crystal ball to see the future, the industry has developed the 70% rule. This rule states that you should never pay more than 70% of the after-repair-value or “ARV” of a property, less any repairs, that you’re flipping. The ARV is your estimate of the home’s worth after all repairs have been done. For example, if the ARV of your flip is $300,000, and it needs $50,000 in repairs, you shouldn’t pay more than $175,000 to acquire the property. If all went well, you’d still have $75,000 in profit to cover other expenses (such as agent and stager fees). Even if something went wrong, you likely wouldn’t end up losing money. Elements of your budget to pay attention to: Jenkins says that it’s especially helpful to understand square footage and how it works for calculating the costs of flooring, for example. “So, when you go in you can say, okay, it’s a 1,000-square-foot home, we’re going to do $1.99 per square foot for carpet, and you’ll know to multiply that by the square footage. That way, if you want to spend $3,000 on carpet, you’ll understand where you may need to make adjustments,” Jenkins explains. Purchasing a home to flip with cash is almost always going to be in your best interest — however, not all investors have that kind of funding. If you need to finance the home with a mortgage, there are a few options you should consider: Disclaimer: As always, there are benefits and drawbacks to each financing option. HomeLight always recommends that you work with a financial advisor to find the best financing option for you. One of the biggest factors that will affect your return on investment will be the market conditions in the area you are looking to flip homes in. Flipping houses requires a delicate balance of availability of homes at discounted prices, making cost-effective renovations, and buyer demand for when you go to sell. Here are some signs that a particular area in Ohio will yield opportunities for profitable house flipping: A strong job market and an increasing population generally translate to increased demand for housing — look into areas with recent influxes in residents as well as low unemployment rates. The cities we mentioned above are all examples of areas with both population growth and increasing home values. More broadly, Ohio as a whole has experienced 1.0% GDP growth over the last five years, ranking it 34th out of the 50 states. The statewide unemployment rate is currently 4.20%. One of the keys to maximizing return on real estate investments is paying attention to home value appreciation in the areas in which you are investing. Steady home price growth over the last few years can help you predict how much your investment might appreciate in value when you go to sell — this can also help inform your strategy. Nationwide, home prices have fallen from their peaks in 2021 and early 2022. However, economists are currently predicting that the market correction we are seeing in the form of falling home prices will be short lived — Wells Fargo’s economists are predicting that prices are going to rebound in 2024 with a 3.3% increase by the end of the year. This is good news for investors currently worried about home prices falling and losing money on their investments. A real estate agent helps with identifying current trends and popular home upgrades. When it’s time to sell your flip, they’ll sell and market it. But they can also help you find houses to flip. Due to the high demand for housing in some markets, and the fact that many sellers list on the open market and sell without repairing or remodeling, it’s become harder for flippers to identify potential homes. An experienced real estate agent will know the cities, neighborhoods, and sometimes even specific houses that are ripe for flipping. Agents who regularly work with flippers understand what makes a particular home a good candidate for this kind of transaction, and their expertise can save you thousands of dollars. “I definitely think it helps to work with somebody who understands numbers and which houses are going to make a good investment,” confirms Jenkins. HomeLight can connect you with the top-performing agents in your desired Massachusetts market. Our free Agent Match tool analyzes over 27 million transactions and thousands of reviews to determine which agent is best for you based on your needs. Once you’ve got an agent keeping an eye out for you, alerts set up on real estate websites, and you are scouring the multiple listing service, it’s time to find a home to flip. It could take several months, and you might have to make several offers on available homes before you’re successful. Be patient! As Jenkins advises, be sure to choose a house that aligns with your budget. If you’re a first-time flipper, now probably isn’t the time to purchase a property that needs to be totally renovated down to the studs. Gain some experience — and hopefully a tidy profit — with your first couple of flips before delving into the major projects. Once you win your bid on the appropriate home, it’s absolutely crucial that you get a home inspection and an appraisal. When you walked through the home, you could probably tell you’d need to remodel the bathroom to sell. But a home inspection will reveal any hidden issues beneath the surface, such as a rotted subfloor in that bathroom, which you might have to replace to safely and successfully flip the home. An appraisal is an estimate of the home’s current market value. If you’re using hard money or a mortgage to finance the flip, the lender will likely require it. The appraisal tells you what the home is worth now — which is valuable information if you’re concerned that you’re paying too much. Line up the contractors, plumbers, electricians, and anyone else you might need to begin work the day after the closing. Check licenses and references before signing any contracts. Once the property is yours, there’s no time to waste! According to the National Association of Realtors remodeling impact report for 2022, high ROI renovations to consider include a bathroom remodel with a 71% return on investment, a kitchen renovation, which has a 75% return on investment, and refinishing hardwood flooring with a whopping 147% return on investment! In Ohio, Jenkins recommends tile work and a nice backsplash, and says that luxury vinyl flooring even holds a big appeal for buyers, who appreciate the durability and long warranty. Once the work is done, flippers have a choice. You can either rent the home and become a landlord, or sell it. If you used hard money to finance your purchase, you’ll have to refinance to hold the property long-term and rent. There are a variety of different ways investors use to determine a monthly rent on their investment properties depending on their financing needs, fair market value, and comps in their market. Here are some methods to consider when getting ready to rent out your property: This is where your top agent can come in handy once again — crafting a listing that highlights the improvements that were made while not being unrealistic on price is a delicate balancing act. Work with your real estate agent to evaluate comps in the area and set a competitive price. List too high and it might sit on the market for too long, too low and you could be leaving money on the table. When a flipped house is ready for the market, your agent will conduct the same process as determining the list price for any other home — by comparing similar homes in the area that have recently sold. Experienced flippers price out home repairs before purchasing a house, and leave themselves a cushion for the unexpected. But not even they could have predicted the 20% increase in construction materials between January 2021 and 2022. Building materials continued to rise in cost by 4.9% in the first four months of 2022, but have since fallen to only about 1.4% higher than they were a year ago. Increases in construction costs could eat away at your flip’s profit, or put you in the red. A delay in getting permits, or having materials delivered, would also decrease profits due to increased holding costs. The longer you own the house before flipping it, the tighter the profit margin. Whether you’re flipping a house in Ohio or anywhere else, keeping a close eye on your time and financial resources is key to coming out ahead — or even just breaking even. If you’re interested in flipping houses, Ohio has great potential. Thanks to economic growth and rising home prices throughout the state, conditions are favorable for savvy house flippers who are willing to be patient and work within their numbers. Be mindful of your budget, skill level, and timeframe when looking for a house to flip — and definitely make sure you have a great agent on your side to help you find, assess, and purchase the right house.What is house flipping?
Is house flipping profitable in Ohio?
How much do Ohio flippers make?
Best places in Ohio to flip a house
Cleveland
Maple Heights
Toronto
Toledo
Akron
I definitely think it helps to work with somebody who understands numbers and which houses are going to make a good investment.
Step-by-step guide to flipping houses in Ohio
Create your network and evaluate your skills
Develop your budget
Financing your flip in Ohio
Research your market
Economic growth
Steady home value appreciation
Partner with a top real estate agent in Ohio
Find a home to flip
Renovation time
Rent or sell
How much should the home rent for?
Setting a list price
What can go wrong with a house flip in Ohio?
Key takeaways
