New Member Making an offer in St. Pete Area - Any Advice
Lizette RiveraPro Member
Member since 2026 · 2 posts · 2 votesNew Member Making an offer in St. Pete Area - Any Advice
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Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votesQuote from @Lizette Rivera:
Hey investors,
At 43 years old, I have finally decided to stop renting and start investing in real estate. I will be moving from Manhattan, NYC to St. Pete, FL and made an offer today on a single-family home 3/1. The house is selling at $377k but needs some cosmetic upgrades. Property Taxes: $6,373/year – Actual. Insurance: $3,600/year – Estimated.
Based on my agent's recommendation, I made an offer for $340k and am waiting to hear back from the seller's agent. The seller paid $353k in 2023 and has been posting the property on Airbnb for the past 6 months. I would like to live in the house the first year then buy my second property and rent out the first house. I have $120k saved.
1. Should I put 10% or 20% down at 5.99% interest? I'm thinking it would be best for me to keep more cash in my savings for the upgrades that are needed. I've also heard that it is best to make 2 payments per month toward the principle.
2. Any advice on becoming a first time home owner/investor?
3. Is it reasonable to think that I can purchase my second property next year?
@Bill B. is pretty much correct on analyzing the 10% and 20% down options.
One other comment though - research what your HELOC options are. You may be able to put 20% down to avoid the PMI and then secure a HELOC for 10% of the equity, effectively matching the 10% down option. Then it is up to you whether or not to tap the HELOC in the future.
NOTE: you would want to secure the HELOC while you are owner-occupying the property.
@Masoud Arouni covered the property tax issues you should be aware of.
Home insurance is another major expense in Florida. Due to all the hurricanes, Florida has some of the highest insurance premiums in the country.
INVESTMENT ADVICE: be careful of buying and making improvements YOU want instead of researching what the market wants!
Too many investors overspend on improvements that either:
- Tenants don't care about
- Tenants won't pay extra rent for, to cover the improvement expenses
HOW DO YOU KNOW YOU'RE CUT OUT TO BE A LANDLORD?
You're buying your first property EVER.
Learning to be an owner-occupant homeowner is your first challenge.
- Maintaining the yard, doing small repairs, etc. will all take time.
If you buy another primary and rent this one out (called stacking), are you planning to DIY manage the rental or hire a PMC?
- DIY: start ASAP about learning what you have to do.
- PMC: start interviews 3+ months before you plan on wanting a tenant. There's a blog series here on BP, "How to Screen a PMC Better than a Tenant" that may help you.
CRAZY IDEA:
You state seller has had property on Airbnb.
Why not give something similar a try via STR or MTR the other bedrooms?
This would not only give you extra funds for the next purchase, but you'd learn a few things about being a landlord.
Logical Property Management4.9459 Reviews
9 Replies
- Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes5mo
If this will be your primary home find out from your lender how much you will save by putting down that extra 10%. That's your return on that money. It could be big or small. Putting that extra $34k down should save you PMI that might be $200/mo, plus you might get a 1/2 percent lower mortgage, that might save you $1,700/yr, plus you'll save let's say 6% on the extra $34k down, another $2,000/yr. So that $34k might save you $4,000/yr, a nice guaranteed 11% return tax free. You'd literally have to 13-14% guaranteed to break even.
Heck, maybe you can afford a 15 year mortage with the extra 10% down and save another $2,000/yr? Good luck and congrats on the move. The great exodus continues.
- Member since 2026 · 2 posts · 2 votes5mo
Great insight! Thank you so much Bill.
- 5moMasoud ArouniPro MemberInvestor · Pleasanton, CA · Member since 2026 · 119 posts · 52 votes
@Lizette Rivera, congrats on making the move and the offer. Bill covered the down payment math well. Your other two questions deserve real answers.
On the 10% vs 20% decision specifically for your situation, at $340K purchase with 10% down your loan is $306K. At 5.99% your monthly principal and interest is roughly $1,835. Add property taxes at $531/month and insurance ~ $300/month and your total monthly carry is approximately $2,666 before any maintenance. At 20% down your payment drops to roughly $1,63, total carry around $2,462. That $200/month difference plus PMI savings is real but you are right that keeping cash for cosmetic upgrades on a Florida home matters, especially insurance surprises in a year or two when your estimated $3,600 could jump 20-30% at renewal.
On buying your second property next year, be careful here. Florida has a homestead exemption that saves you significantly on property taxes but only if it is your primary residence. If you move out after one year and convert to rental you lose that exemption and your tax bill adjusts. Factor that into your rental cash flow projections before you assume the numbers work.
On whether the rental makes sense after year one, St. Pete SFR rents for a 3/1 are running $1,800-2,200 depending on location and condition. At $2,000 rent against your $2,666 monthly carry you are looking at negative cash flow before vacancy and maintenance. The upgrades you make in year one will help but this is a wealth building play via appreciation and equity, not a cash flow play from day one. Know that going in.
Happy to run the full scenario for you if you want to share more details on the upgrades needed and targeted rent.
- 5moDrew SygitBusiness MemberProperty Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
Quote from @Lizette Rivera:
Hey investors,
At 43 years old, I have finally decided to stop renting and start investing in real estate. I will be moving from Manhattan, NYC to St. Pete, FL and made an offer today on a single-family home 3/1. The house is selling at $377k but needs some cosmetic upgrades. Property Taxes: $6,373/year – Actual. Insurance: $3,600/year – Estimated.
Based on my agent's recommendation, I made an offer for $340k and am waiting to hear back from the seller's agent. The seller paid $353k in 2023 and has been posting the property on Airbnb for the past 6 months. I would like to live in the house the first year then buy my second property and rent out the first house. I have $120k saved.
1. Should I put 10% or 20% down at 5.99% interest? I'm thinking it would be best for me to keep more cash in my savings for the upgrades that are needed. I've also heard that it is best to make 2 payments per month toward the principle.
2. Any advice on becoming a first time home owner/investor?
3. Is it reasonable to think that I can purchase my second property next year?
@Bill B. is pretty much correct on analyzing the 10% and 20% down options.
One other comment though - research what your HELOC options are. You may be able to put 20% down to avoid the PMI and then secure a HELOC for 10% of the equity, effectively matching the 10% down option. Then it is up to you whether or not to tap the HELOC in the future.
NOTE: you would want to secure the HELOC while you are owner-occupying the property.@Masoud Arouni covered the property tax issues you should be aware of.
Home insurance is another major expense in Florida. Due to all the hurricanes, Florida has some of the highest insurance premiums in the country.
INVESTMENT ADVICE: be careful of buying and making improvements YOU want instead of researching what the market wants!
Too many investors overspend on improvements that either:
- Tenants don't care about
- Tenants won't pay extra rent for, to cover the improvement expensesHOW DO YOU KNOW YOU'RE CUT OUT TO BE A LANDLORD?
You're buying your first property EVER.
Learning to be an owner-occupant homeowner is your first challenge.
- Maintaining the yard, doing small repairs, etc. will all take time.If you buy another primary and rent this one out (called stacking), are you planning to DIY manage the rental or hire a PMC?
- DIY: start ASAP about learning what you have to do.
- PMC: start interviews 3+ months before you plan on wanting a tenant. There's a blog series here on BP, "How to Screen a PMC Better than a Tenant" that may help you.CRAZY IDEA:
You state seller has had property on Airbnb.
Why not give something similar a try via STR or MTR the other bedrooms?This would not only give you extra funds for the next purchase, but you'd learn a few things about being a landlord.
Logical Property Management4.9459 Reviews - 5moRaymond J. RodriguesBusiness MemberLender · Miami, FL · Member since 2017 · 1k+ posts · 797 votes
@Lizette Rivera did your offer end up getting accepted? I would put 10% down and save the rest for reserves, as long as the payment is manageable for you, which I imagine that it is.
You can definitely purchase your second property next year. Let's connect!
Helm Mortgage Corp.5127 Reviews - Investor · Hendersonville, NC · Member since 2016 · 498 posts · 285 votes5mo
Quote from @Lizette Rivera:
Hey investors,
At 43 years old, I have finally decided to stop renting and start investing in real estate. I will be moving from Manhattan, NYC to St. Pete, FL and made an offer today on a single-family home 3/1. The house is selling at $377k but needs some cosmetic upgrades. Property Taxes: $6,373/year – Actual. Insurance: $3,600/year – Estimated.
Based on my agent's recommendation, I made an offer for $340k and am waiting to hear back from the seller's agent. The seller paid $353k in 2023 and has been posting the property on Airbnb for the past 6 months. I would like to live in the house the first year then buy my second property and rent out the first house. I have $120k saved.
1. Should I put 10% or 20% down at 5.99% interest? I'm thinking it would be best for me to keep more cash in my savings for the upgrades that are needed. I've also heard that it is best to make 2 payments per month toward the principle.
2. Any advice on becoming a first time home owner/investor?
3. Is it reasonable to think that I can purchase my second property next year?
Sounds like you're on the right track with the offer price considering the cosmetic work and Airbnb history. Given that you want to live there first, keeping cash for upgrades is smart. I usually lean toward a 20% down to avoid PMI, but if it's tight, 10% can work,just factor in the extra monthly cost. Two payments a month helps chip away principal faster, but don't rely on that alone.
Another angle worth checking is local code enforcement or ownership patterns, especially since the place was an Airbnb recently; sometimes short-term rentals flag underlying maintenance issues or neighborhood complaints that could impact resale or renting later on. Keep an eye on those before you seal the deal. - 5moShawn McCormickPro MemberRealtor · Central Florida-Orlando · Member since 2014 · 1k+ posts · 892 votes
@Lizette Rivera Congrats and welcome to Florida.
Everyone has touched on the 10% vs 20%. The conversation I usually like to have with buyers is where do you want your savings to come from.
You could offer closer to asking price (more likely to get accepted) and then ask the seller to contribute money towards your closing costs (keeps that money in your pocket for those upgrades) and/or ask them for concessions to buy down your interest rate (saves you money every month for the life of the loan) Since rates don't look to be coming down and realistically will never be below 5 for a very long time, this could really help you once it turns into a rental and you lose your homestead exemption.
Either of these strategies could be beneficial to you. Depending on your lenders program, conventional loans max at 2% seller concessions, but some have options up to 6% and you can use that money to pay all of your closing costs or pay some c/c and some towards rate buy down. Just a thought.
Best of luck!
- MD/DC · Member since 2024 · 1k+ posts · 1k+ votes5mo
What was the rationale from Realtor for such a low offer? It is less than the seller paid which unless they are in a bind probably won't fly. While I wouldn't necessarily expect significant gains in two years I definitely wouldn't want to sell for less than I paid. They will be eating closing costs on both ends also. Congrats on your first home and learning the ropes.
- 5moVijay FriedmanBusiness MemberMiami, FL · Member since 2026 · 766 posts · 122 votes
Quote from @Lizette Rivera:
Hey investors,
At 43 years old, I have finally decided to stop renting and start investing in real estate. I will be moving from Manhattan, NYC to St. Pete, FL and made an offer today on a single-family home 3/1. The house is selling at $377k but needs some cosmetic upgrades. Property Taxes: $6,373/year – Actual. Insurance: $3,600/year – Estimated.
Based on my agent's recommendation, I made an offer for $340k and am waiting to hear back from the seller's agent. The seller paid $353k in 2023 and has been posting the property on Airbnb for the past 6 months. I would like to live in the house the first year then buy my second property and rent out the first house. I have $120k saved.
1. Should I put 10% or 20% down at 5.99% interest? I'm thinking it would be best for me to keep more cash in my savings for the upgrades that are needed. I've also heard that it is best to make 2 payments per month toward the principle.
2. Any advice on becoming a first time home owner/investor?
3. Is it reasonable to think that I can purchase my second property next year?
Congrats on taking the step from renting to buying/investing. For your situation, I’d compare the 10% vs 20% down option side by side instead of only focusing on the lower payment.
Since the property needs upgrades and Florida insurance/taxes can be meaningful, keeping enough cash reserves may be more valuable than putting every extra dollar into the down payment. I'd want to know the monthly payment difference, PMI if applicable, estimated repair budget, insurance quote, and how much cash you'd still have left after closing.
Buying a second property next year may be possible, but it will depend on your remaining reserves, income, debt-to-income ratio, and how this first property performs after repairs. I’d prioritize buying this one safely first, then plan the second purchase once the numbers are stable.
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