Cost Segregation in Columbus, OH

Ohio's capital and fastest-growing metro combines Ohio State University's 65,000 students, Intel's $20B chip fab, and a booming tech scene — all with full bonus depreciation conformity and entry prices under $300K.

Population
2.1M
Median Home
$290K
Rent (3BR)
$1,700
Property Tax
1.56%
Annual Job Growth
25K+
Ranking
#1 in Ohio
Overview

Value Props for Investors

Intel Effect
Intel $20B Chip Fab Transforming the Region

Intel's New Albany megafab is creating 3,000+ direct jobs, 10,000 construction jobs, and attracting dozens of supplier companies. This is the largest private-sector investment in Ohio history, driving housing demand across the metro.

Guaranteed Demand
Ohio State: 65K Students, Endless Tenant Pool

The nation's largest university campus ensures consistent rental demand year-round. Faculty, staff, medical residents, and graduate students provide high-quality, reliable tenants in the campus corridor.

Full Conformity
OH Full Bonus Depreciation + Sub-$300K Prices

Ohio's full IRC conformity means both federal and state tax savings in Year 1. At $290K median prices, your cost seg ROI per dollar invested is among the highest in the country — 626% return on study cost.

Tax Strategy

Cost Segregation & Tax Rules in Columbus, OH

Understanding how federal and Ohio state tax rules interact is critical to maximizing your cost segregation benefits in Columbus.

Cost Seg Overview
State vs. Federal Rules
Tax Landscape
Typical Purchase
$290,000
Building Value
80%
20% land / 80% building
Cost Seg Range
25-38%
of building reclassified
Home Age
28 yrs
Built ~1996
What Gets Reclassified

A cost segregation study identifies building components that can be depreciated over 5, 7, or 15 years instead of the standard 27.5 or 39 years. In Columbus, typical reclassification rates are 25-38% of building value.

Purchase Price Breakdown
Building 80%$232,000
Land 20%$58,000
Building Value Reallocation (with Cost Seg)
5-Year Property18%
$41,760
15-Year Property12%
$27,840
27.5 / 39-Year (Remaining)70%
$162,400

5 & 15-year components ($69,600 = 30% of building) are eligible for bonus depreciation in Year 1.

Overline Study Cost & ROI
Overline Study Cost
$499 - $2,000
Avg. ROI
10-40x

The math: A $290,000 property with 80% building value and 30% reclassification yields ~$25,752 in Year 1 federal tax savings at the 37% bracket — significantly more ROI than traditional studies costing $5,000-$10,000+.

Housing Stock Advantage

With a median build year of 1996, Columbus's housing stock has identifiable components (HVAC, electrical, plumbing, landscaping) that are strong candidates for accelerated depreciation.

Full Conformity
Ohio Bonus Depreciation Conformity

Ohio conforms to federal bonus depreciation under IRC Section 168(k). While OH uses a graduated income tax (currently 0-3.50%), cost seg reclassifications qualify for 100% first-year expensing on both federal and state returns, with the state benefit scaling with your income bracket.

What This Means for Columbus Investors: Full conformity means cost seg benefits are maximized in Ohio. Federal AND state deductions apply in Year 1. Combined with Ohio's affordable property prices, the ROI per dollar invested is among the highest in the country.

Federal vs. OH Depreciation Timeline
PeriodFederal TreatmentOH State Treatment
Year 1100% bonus depreciation100% bonus depreciation (full conformity)
Years 2+Standard MACRS schedulesSame as federal
Section 179 Expensing
State ConformityConforms

Ohio conforms to federal Section 179 expensing. For investors in Columbus's new-construction market (driven by the Intel megafab), Section 179 captures qualifying personal property that accelerates beyond standard cost seg timelines.

Key Takeaway

A $215K property with a $183K depreciable basis and 28% cost seg reclassification yields ~$18,933 in federal tax savings PLUS ~$1,791 in OH state tax savings in Year 1 — a total of ~$20,724 on a very affordable property.

Bottom Line

Ohio is a full-conformity state. Every dollar of federal bonus depreciation flows through to your OH state return with no addback or modification. The low property prices amplify your effective ROI on every cost seg study.

Local Property Tax
1.56%
Columbus effective rate
Transfer Tax
$1 per $1,000 of sale price (conveyance fee)
State Income Tax
3.50%
Top Rate (Graduated)
Property Tax Details

Franklin County effective rate of ~1.56% is slightly above the state average. Reappraisal every 3 years. Property taxes are the main cost headwind in Columbus.

Assessment Methodology
MethodMarket value at 35% assessment ratio
Reassessment CycleEvery 6 years (with triennial updates)
Assessment BodyCounty Auditor
Appeal WindowJanuary 1 – March 31 of the year following the tax year
Appeal Success Likelihood
Good
LowModerateGoodVery High

Ohio's 6-year cycle with triennial interim adjustments creates a unique appeal cadence. The Board of Revision (BOR) handles county-level appeals at no cost. Ohio law allows recent sale prices as strong evidence. High effective rates in Cuyahoga County (Cleveland) and Franklin County (Columbus) make appeals particularly impactful.

Work with Overline — Our team helps Columbus investors identify over-assessed properties and file tax appeals. A successful appeal can save thousands annually and compounds your cost seg savings.

Illustrative Example

Cost Seg Example for Columbus, OH

This example assumes a purchase eligible for 100% bonus depreciation. All factors below are based on averages from our historical cost segregation studies for OH properties. To see your exact savings, run a property-specific cost seg analysis below.

Typical Columbus, OH Property Details
$
50%95%
5%35%
2%25%
Total Reclassified30% of building
10%37%
Estimated Year 1 Tax Savings
Building Value$232,000
$290,000 x 80%
Normal Annual Depreciation$8,436
$232,000 ÷ 27.5 yr (residential)
5-Year Reclassified$41,760
15-Year Reclassified$27,840
Total Accelerated$69,600
30% of $232,000 building value
Federal Tax Savings (Year 1)$25,752
$69,600 x 37% bracket
OH State Tax Savings (Year 1)$2,436
Total Year 1 Tax Savings$28,188
8.3x normal annual deduction captured in Year 1

OH State Tax: OH has full bonus depreciation conformity — both federal and state savings hit your pocket in Year 1.

Insurance & Risk

Insurance Landscape in Columbus

Insurance costs directly impact your cash flow. Understanding Columbus's risk profile helps you budget accurately and avoid coverage gaps.

Avg. Annual Premium
$1,200
Columbus average
State Average
$1,200
48% below average
National Average
$2,300
for comparison
Key Risk Drivers
1
Severe thunderstorms and wind
2
Hail damage
3
Winter ice storms
Coverage Recommendations
Standard homeowner's policy with replacement cost coverage
Wind/hail deductible awareness (typically 1% of dwelling coverage)
Sewer/drain backup coverage (common in older Ohio cities)
Umbrella liability policy ($1M+) for rental properties
Cost Seg + Insurance Connection

Ohio's extremely low insurance costs are a major advantage for cash flow. A cost seg study documents component values that support accurate replacement cost estimates — particularly important for Ohio's older housing stock where original construction costs may not reflect current replacement values.

Revenue Comparison

STR vs. Long-Term Rental in Columbus

Compare short-term (Airbnb) and long-term rental income for a typical Columbus investment property.

Long-Term Rental
Monthly Rent (3BR)$1,700
Annual Gross$20,400
Vacancy Rate5%
Net Annual$19,380
Tenant StabilityHigh — university, healthcare, and government workers provide stable long-term demand
Depreciation Schedule27.5 years
Residential rental property
Tax TreatmentPassive Only
Losses can only offset passive income unless you qualify as a Real Estate Professional (750+ hrs/yr)
Short-Term Rental
Avg. Nightly Rate$135
Occupancy Rate68%
Annual Gross Revenue$33,500
Net Annual (after expenses)$23,450
Management20-25% of gross
Depreciation Schedule39 years
Classified as commercial / transient use property
Tax TreatmentActive Income Eligible
Losses can offset W-2 / active income if you document 100+ hrs of material participation and meet IRS criteria
Cost Seg + STR Loophole

Whether you choose LTR or STR, Ohio's full bonus depreciation conformity amplifies your Year 1 returns. STR operators near Ohio State can gross $33K+ while capturing $28K in cost seg savings.

Market Fundamentals

Economy & Housing Demand in Columbus

Strong economic engines create stable rental demand. Here is what drives Columbus's economy and housing market.

Median Income
$68,000
Rent-to-Income
25%
Healthy ratio
Vacancy Rate
4.0%
Pop. Growth
+1.5% annually
Major Employers
1
Ohio State University (45K+)
2
OhioHealth (35K+)
3
Nationwide Insurance (13K+)
4
JP Morgan Chase (12K+)
5
Honda (10K+)
6
Intel (3K+ and growing)
Top Industries
Healthcare
Education
Insurance & Finance
Technology
Government
Landlord & STR Rules
Landlord Friendliness
Friendly
Eviction Timeline
30-45 days
STR Regulation
Permitted with registration

Columbus requires STR operators to register and collect a 5.1% lodging tax. Most residential zones allow STRs. The Ohio State campus area and Short North see strong STR demand.

Why Invest Here

Columbus is the rare Midwest city with true growth momentum. The Intel megafab alone is bringing 3,000+ permanent jobs and 10,000 construction workers. Ohio State's 65K students guarantee rental demand. Entry prices under $300K with full bonus depreciation conformity make the cost seg math exceptional — $28K+ in Year 1 tax savings on a sub-$300K property.

Where to Invest

Top Neighborhoods in Columbus

#1
Clintonville
Walkable & established
Price
$320K
Rent
$1,800
Yield
6.8%
Walkable neighborhood near Ohio State with strong appreciation and reliable tenant demand from young professionals.
$320K$1,8006.8%
Walkable neighborhood near Ohio State with strong appreciation and reliable tenant demand from young professionals.
Walkable neighborhood near Ohio State with strong appreciation and reliable tenant demand from young professionals.
#2
Westerville
Suburban family
Price
$340K
Rent
$1,900
Yield
6.7%
Top-rated schools and suburban appeal drive consistent family rental demand. Newer construction yields solid cost seg results.
$340K$1,9006.7%
Top-rated schools and suburban appeal drive consistent family rental demand. Newer construction yields solid cost seg results.
Top-rated schools and suburban appeal drive consistent family rental demand. Newer construction yields solid cost seg results.
#3
Franklinton
Up-and-coming arts district
Price
$210K
Rent
$1,400
Yield
8.0%
Rapid gentrification with brewery and gallery scene. Sub-$250K entry with strong cash flow and appreciation upside.
$210K$1,4008.0%
Rapid gentrification with brewery and gallery scene. Sub-$250K entry with strong cash flow and appreciation upside.
Rapid gentrification with brewery and gallery scene. Sub-$250K entry with strong cash flow and appreciation upside.
#4
Hilliard / Grove City
Affordable suburban
Price
$280K
Rent
$1,650
Yield
7.1%
Affordable suburbs with newer housing stock. Good cost seg fundamentals with 80%+ building values.
$280K$1,6507.1%
Affordable suburbs with newer housing stock. Good cost seg fundamentals with 80%+ building values.
Affordable suburbs with newer housing stock. Good cost seg fundamentals with 80%+ building values.
#5
New Albany
Intel corridor premium
Price
$420K
Rent
$2,200
Yield
6.3%
Ground zero for the Intel boom. Appreciation play with premium rents from tech and construction workers.
$420K$2,2006.3%
Ground zero for the Intel boom. Appreciation play with premium rents from tech and construction workers.
Ground zero for the Intel boom. Appreciation play with premium rents from tech and construction workers.
Local Partners

Investor-Friendly Partners in Columbus, OH

We are building a curated directory of top investor-friendly brokers, property management companies, and service providers in Columbus, OH.

Investor-Friendly Brokers

Top real estate agents who specialize in investment properties and understand cost segregation, 1031 exchanges, and cash-flow analysis.

Coming Soon
Property Management

Vetted property managers who handle tenant screening, maintenance, and rent collection for both long-term and short-term rentals.

Coming Soon
Insurance Agents

Independent insurance agents who specialize in rental property coverage and can leverage cost seg data for accurate replacement cost estimates.

Coming Soon

Are you a broker, property manager, or insurance agent serving investors in Columbus, OH?

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Frequently Asked Questions

Cost Segregation FAQ — Columbus, OH

How much can I save with cost segregation in Columbus, OH?

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On a typical $290K property in Columbus, cost segregation can yield approximately $28,188 in Year 1 combined federal and state tax savings at the 37% bracket, with a study ROI of 626%. Overline studies cost $499-$2,000.

What is the property tax rate in Columbus?

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The effective property tax rate in Columbus is approximately 1.56%. Franklin County effective rate of ~1.56% is slightly above the state average. Reappraisal every 3 years. Property taxes are the main cost headwind in Columbus.

Is Columbus a good market for real estate investing?

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Columbus is the rare Midwest city with true growth momentum. The Intel megafab alone is bringing 3,000+ permanent jobs and 10,000 construction workers. Ohio State's 65K students guarantee rental demand. Entry prices under $300K with full bonus depreciation conformity make the cost seg math exceptional — $28K+ in Year 1 tax savings on a sub-$300K property.

What is the average insurance cost for rental properties in Columbus?

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The average annual homeowner insurance premium in Columbus is approximately $1,200. Columbus enjoys some of the lowest insurance costs in the country — 48% below the national average. The primary risks are summer storms and hail. Standard policies cover most risks without expensive riders.

What are the STR and landlord rules in Columbus?

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Columbus is rated "Friendly" for landlords. STR regulation: Permitted with registration. Eviction timeline: 30-45 days. Columbus requires STR operators to register and collect a 5.1% lodging tax. Most residential zones allow STRs. The Ohio State campus area and Short North see strong STR demand.

Who are the major employers in Columbus?

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Major employers in Columbus include Ohio State University (45K+), OhioHealth (35K+), Nationwide Insurance (13K+), JP Morgan Chase (12K+), Honda (10K+). Top industries: Healthcare, Education, Insurance & Finance, Technology, Government.

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