Toledo is the perfect real estate market for investors looking for affordable single-family rental property in a market with sure and steady growth. With an average price per square at less than $90 for a home, it’s easy to understand why Money Crashers ranks Toledo as the 2nd best buyer’s market in the U.S., just behind Cleveland.
Relatively inexpensive housing has always been one of the bright spots in Toledo, with the investment dollar going much further than other Ohio cities such as Cincinnati and Dayton. Despite the low cost of housing in the city, Toledo is very much a rental market, with nearly half of the households renting rather than owning.
Toledo is in northwest Ohio, located along the shores of Lake Erie and less than a one hour drive from Detroit. The economy is powered by the transportation, manufacturing, auto assembly, education and healthcare, and glass manufacturing sectors, earning Toledo the nickname “The Glass City”.
Population and job growth in the Toledo Metro area are slow and steady. Combined with affordable real estate prices and rising rents, it’s no wonder that investors are taking notice of the Toledo real estate market in 2022.
Toledo is seeing a slow-down in long-term population growth, the same as most cities in Ohio.
Key Population Stats:
- City of Toledo is home to about 271,000 residents with nearly 644,000 living in the Toledo metropolitan area.
- Toledo is the 4th most populated city in Ohio and the 79th-largest city in the U.S.
- Toledo MSA comprises Fulton, Wood, and Lucas counties (the county Toledo is located in).
- Toledo has strong economic ties to Detroit, located just 40 miles north of Toledo, and is part of the Great Lakes Megalopolis.
- Population in Metro Toledo has increased by 6.5% year-over-year while the population of the city has declined by 5.7% over the past decade.
Toledo is ranked #1 for new business investment, a sign that economic momentum in Toledo continues to build. According to the City of Toledo, there are currently $2.2 billion worth of development projects underway that should create 3,500 new jobs and over 1,000 new residential housing units.
Key Employment Stats:
- GDP of Toledo MSA is nearly $33.5 billion, according to the Federal Reserve Bank of St. Louis, and has grown by more than 9% over the past 10 years.
- Job growth in Toledo increased by 8.43% last year while unemployment is down to 3.6%.
- Employment sectors showing the most robust growth include construction, manufacturing, and trade and transportation, according to the BLS (April 2022).
- Target industry clusters in Toledo and Lucas County include plastics and automotive components, engineering services, logistics and warehousing, biomedical and advanced manufacturing.
- Fortune 500 and Fortune 1000 companies headquartered in the Toledo metropolitan area are Dana Incorporated, Owens Corning, The Andersons Inc., Owens Illinois, and HCR ManorCare.
- Largest employers in Toledo and Lucas County include ProMedica, Mercy Health, Bowling Green State University, The University of Toledo, The Andersons, GM, HCR ManorCare, First Solar, Welltower real estate investment trust, and Marathon Petroleum Corporation.
- Some of the major colleges and universities in Toledo are The University of Toledo, University of Toledo College of Medicine and Life Sciences, Davis College, and Owens Community College.
- 91% of Toledo residents are high school graduates or greater, while 27.3% hold a bachelor’s degree or advanced degree.
- Interstate highways I-70 and I-80 run through Toledo and put the region within an 8-hour drive of 60% of the U.S. population.
- Toledo is a main hub and artery for freight rail lines Norfolk & Southern and CSX.
- Port of Toledo provides large freight and bulk commodity shipping service throughout the Great Lakes Region.
- Toledo Express Airport (TOL) is served by Allegiant and American Airlines providing non-stop service to Orlando, Tampa, Fort Myers, Charlotte, and Chicago.
Real estate market
The Toledo real estate market is currently a buyer’s market, with the supply of homes greater than the demand for homes. That’s good news for real estate investors who are looking to buy a good rental property at a fair price without getting caught up in a bidding war.
Key Market Stats:
- Zillow Home Value Index (ZHVI) for Toledo is $109,347 through May 2022.
- Home values in Toledo have increased by 16.3% over the last year.
- Over the past five years home values in Toledo have increased by more than 72%.
- Median list price of a single-family home in Toledo is about $119,000, according to Realtor.com (April 2022).
- Median sales price of a single-family home in Toledo is $128,500.
- Days on market (average) for a home is 64.
- Sale-to-list price ratio is 99.1%, which means that homes are selling for a little less than the listing price on average.
- Of the 25 neighborhoods in Toledo, Westgate is the most expensive with a median listing price of $190,000.
- Most affordable neighborhood in Toledo is Northriver where the median listing price of a home for sale is $28,700.
Strong renters’ market
MarketWatch recently named Toledo as one of the 25 cities in the U.S. where a Social Security check will easily cover the rent.
That’s probably one of the reasons why nearly half of the households in Toledo rent rather than own. It may also be why the real estate market in Toledo is strong and steady. According to Realtor.com, home prices in Toledo are projected to increase by 11.0% while sales volume in the market is expected to grow by about 2.4%.
Key Market Stats:
- Median rent in Toledo is $975 per month for a 3-bedroom unit based on the most recent research from Zumper (June 2022).
- Rents in Toledo have increased by 9% year-over-year.
- Over the past 3 years, rent for a 3-bedroom home in Toledo has increased by 226%.
- Renter-occupied housing units account for 45% of the total occupied housing units in Toledo.
- Most affordable neighborhoods in Toledo for renters are Englewood, Warren Sherman, and North Towne where rents run between $495 and $800 per month.
- Most expensive neighborhoods in Toledo for renters are Westgate, DeVeaux, and Reynolds Corners where rents can go as high as $1,400 per month.
Historic price changes & housing affordability
When narrowing down the options of which real estate markets to buy property in, investors usually include data on home price changes and housing affordability in their analysis.
Historic price changes may indicate the potential for future property appreciation. How affordable houses are to buy can help indicate the potential demand for rental property, everything else being equal.
Each month Freddie Mac releases up-to-date data on the change in home prices for all markets across the U.S. The most recent Freddie Mac House Price Index (FMHPI) report for the Toledo MSA reveals:
- April 2017 HPI: 102.3
- April 2022 HPI: 151.9
- 5-year change in home prices: 48.4%
- One-year change in home prices: 12.1%
- Monthly change in home prices: 1.0%
The Housing Affordability Index (HAI) is a report showing how affordable it is to buy a home in every market throughout the U.S.
However, markets where houses are affordable aren’t necessarily bad rental markets. For example, even though homes in Toledo are very affordable to buy relative to other cities in the U.S., nearly 50% of the households rent rather than own.
This may be due to various factors including economic levels, low supply of housing inventory, and lifestyle preferences.
The HAI uses 100 as a baseline affordability index number. The greater a market’s HAI is above 100, the more affordable a market is, everything else being equal. When creating the analysis, researchers look at median family income compared to the median price of an existing single-family home purchased using a conventional mortgage with 20% down.
Based on the latest report from Home Town Locator, the HAI for the Toledo MSA was 162 as of July 2021. This means that the median family has a little more than one and one-half times the income needed to purchase a median priced, single-family resale home in the Toledo metro area.
Quality of Life
Livability.com has long been suggesting that people should take a second look at living and working in Toledo, Ohio. People are friendly, the city is affordable, and there’s plenty of culture and opportunity.
Key Quality of Life Stats:
- Forbes gives Toledo solid rankings as a best place for business and careers, cost of doing business, job growth, and education.
- Cost of living in Toledo is 13% below the national average.
- Niche.com says Toledo is one of the best places to live in Lucas County (where Toledo is located) and gives the city strong ratings for cost of living and nightlife.
- Attractions in Lucas County include the Toledo Museum of Art, Toledo Zoo, Lake Erie and the Maumee River, and a vast network of forests and wetlands.
- Climate in Toledo is humid continental with four distinct seasons, warm and humid summers and cold snowy winters.
- Toledo is home to a variety of companies manufacturing glass windows, bottles, and art, earning the nickname “The Glass City”.
- U.S. News & World Report ranks Toledo among the top cities in the country to live and to retire.
- ProMedica Toledo Hospital and Advanced Specialty Hospital of Toledo are ranked as two of the best healthcare facilities in the city.
- The Automobile Racing Club of America is headquartered in Toledo and the Highland Meadows Golf Club hosts the annual LPGA Marathon Classic.
Get out the map
Where to begin your search? Roofstock created a heat map of Toledo based on our Neighborhood Rating, a dynamic algorithm that enables you to make informed investment decisions by measuring school district quality, home values, employment rates, income levels and other vital investment criteria.
DARK GREEN: 4-5 star neighborhood
LIGHT GREEN: 3.5-4 star neighborhood
YELLOW: 2.5-3 star neighborhood
ORANGE: 2 star neighborhood
RED: 1 star neighborhood
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