HOUSINGNEWS REPORT
STATE SPOTLIGHT
Real estate investor Mike Daggett purchased this Grand River, Ohio, home in the northeastern suburbs of Cleveland as a bank-owned home for $35,000 in July 2013, rehabbed it for $40,000 and sold a year later for $113,000
East Side Avoidance Ford said savvy real estate investors will mostly avoid blighted areas like the east side of Cleveland, but he’s more concerned with less savvy investors who might get in over their heads with highly distressed properties in blighted neighborhoods and end up walking away from the investment. Cantwell said he learned early on in his investing career to invest in markets he was very familiar with and that represented less risk. “We learned pretty much to avoid the east side. We stayed pretty much on the west side and the southwest suburbs,” he said, noting that the foreclosure crisis came early to Cleveland, starting around 2003 as risky mortgages quickly failed. “I knew that the east side was going to be in trouble because there were so many investors coming out of the woodwork,
buying with no money down … a lot of those deals we just walked away from because we knew something was funky.“ In 2011 during a battle with pancreatic cancer, Cantwell closed a privately funded deal in which he outsourced the rehab because he was in the hospital for surgery. That deal gave him an epiphany about his business going forward. “That deal changed my personal investing career forever because I realized I wanted to understand the financing side almost exclusively,” he said. “I realized if I controlled the money, I could control the deal flow. (Now) People come to us all day bringing us incredible deals in Cleveland and all over the country because we have millions and millions of dollars in funding.”
suburb of Grand River, is one of those investors. He’s applying with Cantwell’s Freeland Ventures to get funding to buy more distressed properties to flip. He’s focusing on neighborhoods in the northeastern suburbs that he knows well and holding out for a “screaming deal.” “This is what I focus on, a neighborhood of about $150,000. I try to get those properties for less than 100 grand or not much over,” he said, noting he’s bid on three properties unsuccessfully. “The first someone outbid me. The last two I bid on, they are still on the market, which means I didn’t get outbid, but it’s almost as if the banks are holding out for a certain price. … (If) I’m coming in too low for the banks, just move on.” And Daggett is also staying disciplined about the neighborhoods where he purchases.
Daggett, the investor who flipped a bank- owned property in the northeastern
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