Understanding A, B and C Class Properties | Investing | Real Estate Investing | Dayton, OH | EP. 16

Hey everybody, welcome back. This is vlog number 16. There you go. Hi, welcome back again. This is supposed to be a day in life series of the Freedom Real Estate Group family of companies. And today we're going to be talking about the class of properties here in this area. Now, this is going to vary from town to town, but we're going to be discussing the classes of properties that we do here in southwest Ohio. And again, I'm here with our director of investments and sales and whatever else that says on his door today. But this is Mark. And so Mark's going to go through this for you to give you an idea of what we do here.

Sure, absolutely. Flip. So primarily here at Freedom Real Estate Group, we are going to be working in B and C class properties. So then I'm going to I guess take us through what are the different classifications and how we may grade those and look at those properties. So starting with an A class property, typically they're going to be a newer property or they've just been redone to look brand new. Hardwood floors, granite, excellent school districts, great appreciation. That is an A class property. A B class property is going to be typically a little bit older than that. Maybe 30 years old or older than that has been redone still in very good school districts. Low crime rates. These are things that we use here at Freedom Real Estate Group in determining these different class levels. And then a C class property is even going to be a little bit older than say the B class property. Still in good school district, but maybe not towards the excellent or the high. But it does have potential for great earnings and cash flow. And I'll jump back into that in a second. And then of course, our D class properties, sometimes you'll hear somebody say war zone or something like that. We do not purchase in that for our investors. So again, like I mentioned, we primarily are going to be in the balance. And C class, they seem to have the highest cash flow and rate of returns for our investors. They're excellent properties, have great appreciation, low maintenance or little to no maintenance for future investors.

Yeah, what we always say is if we don't feel safe walking down the street at 7 o' clock at night, we don't buy in that neighborhood. Right. That's the first thing. The second thing I want to touch on is A class properties. Why we don't do A class properties is because like what Mark was saying, the return on that is much lower because you're spending so much more money for the property. But the rent doesn't equate to that 1% of rent to ARV. So that's one of the other main reasons why we don't purchase any A class properties.

Absolutely. I mean, so the fact that Flip and I are both realtors, we can look for an A class property for our investors. But like you had mentioned, the return on that is purchasing the property and hoping in time that your house gains, not the cash flow over the years.

Yeah. Some people will say in their town or their area that the class of properties depends on the year it was built. We're dealing with properties built anywhere from last year to 1890. So it really doesn't work for us in southwest Ohio to base it upon when the properties were built. And so. And we've had people come here from California and look at our. Look at our C class properties and they couldn't believe it. Then we took them to a D class property. They're like, oh, this is our C class property. So I guess said it varies from town to town, but that's how we do things here in southwest Ohio. Anything else?

No, I think that covers a lot.

Awesome. Well, like, we. We always try to keep these short and sweet. So again, I hope you enjoyed today's vlog and we look forward to seeing you on our next vlog coming up soon. Bye.