Orlando FL or Fairfax VA

Member since 2022 · 11 posts · 4 votes

I am interesting in buying single family rental (SFR) property in Orlando or Fairfax VA. Is Orlando saturated? heard a lot of BTR. Fairfax seems very expensive now. But someone say it appreciates very well. Do you guys want to share your thoughts of the SFR markets in these two places?

Thanks

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Jason WrayPro Member

Banker · Nationwide · Member since 2020 · 2k+ posts · 1k+ votes

5mo

You cannot go wrong with Orlando right now because prices have dropped in certain neighborhoods. Orlando is Non-stop tourism there is No downtime even in the winter we get snowbirds from up North and its packed with snowbirds either looking for a STR, MTR or LTR or needing to move to work in the Orlando area and its growing.

Just stay away from "New Construction" that has been ruining new investors ability to refinance and in most cases your under water in the first 1-2 years. Look for a "TLC" property that might need some basic repairs or cosmetic upgrades. That way you get the distressed price and can kick start your ARV faster.

The other key is try and stay away from an HOA area and Condo's becuase there are better options and HOA robs cash flow! If you have any specific questions about Orlando or Florida feel free to check out my profile and send me an email. Always happy to help other BP members avoid pitfalls and save money.

[email protected]727-637-4289

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Jason WrayPro Member
Banker · Nationwide · Member since 2020 · 2k+ posts · 1k+ votes
5mo
You cannot go wrong with Orlando right now because prices have dropped in certain neighborhoods. Orlando is Non-stop tourism there is No downtime even in the winter we get snowbirds from up North and its packed with snowbirds either looking for a STR, MTR or LTR or needing to move to work in the Orlando area and its growing.
Just stay away from "New Construction" that has been ruining new investors ability to refinance and in most cases your under water in the first 1-2 years. Look for a "TLC" property that might need some basic repairs or cosmetic upgrades. That way you get the distressed price and can kick start your ARV faster.
The other key is try and stay away from an HOA area and Condo's becuase there are better options and HOA robs cash flow! If you have any specific questions about Orlando or Florida feel free to check out my profile and send me an email. Always happy to help other BP members avoid pitfalls and save money.
[email protected]727-637-4289
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- Ryan MoyerBusiness Member
  Property Manager · Orlando Kissimmee Davenport Salt Lake City, Park City · Member since 2019 · 991 posts · 1k+ votes
  5mo
  Quote from @Jason Wray:
  
  You cannot go wrong with Orlando right now because prices have dropped in certain neighborhoods. Orlando is Non-stop tourism there is No downtime even in the winter we get snowbirds from up North and its packed with snowbirds either looking for a STR, MTR or LTR or needing to move to work in the Orlando area and its growing.
  Just stay away from "New Construction" that has been ruining new investors ability to refinance and in most cases your under water in the first 1-2 years. Look for a "TLC" property that might need some basic repairs or cosmetic upgrades. That way you get the distressed price and can kick start your ARV faster.
  The other key is try and stay away from an HOA area and Condo's becuase there are better options and HOA robs cash flow! If you have any specific questions about Orlando or Florida feel free to check out my profile and send me an email. Always happy to help other BP members avoid pitfalls and save money.
  
  You can definitely go wrong in Orlando right now. If you're not theming at a high level, you're going to get killed.
  No idea what you're talking about with HOAs. That is broad generic nationwide advice. In Orlando the STR neighborhoods that rent at a high level have HOAs. They come with waterparks and movie theaters in the neighborhood.
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Hannah McDonald
Property Manager · Orlando, FL · Member since 2021 · 22 posts · 17 votes
5mo
Orlando has a high renter population (~60-65%) so it’s a great market but definitely over saturated in some areas. Some areas you can find a renter in less than 15 days and others are sitting 60+. I live in Polk county and we are oversaturated with rentals so you have to be really aggressive with pricing but other areas in East and North Orlando are in higher demand and not as price sensitive. What areas are you targeting in Orlando?
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Shawn McCormickPro Member
Realtor · Central Florida-Orlando · Member since 2014 · 1k+ posts · 892 votes
5mo
@Peter Lee I would be happy to talk about Orlando. I've been here over 20 years, full time Realtor and investor.
There are certainly areas that you would want to stay away from that were targets for investors buying new construction and is heavily rental stocked (think Davenport, Haines City etc). Depending on your buy box and ideal tenant base we can focus on families(school districts, newer communities like Winter Garden, Oviedo), higher income professionals (Lake Nona) or maybe blue collar (Apopka, Groveland, Deltona) Mix of those and growth (Clermont) or maybe student housing out by UCF. Lots of great options.
Prices and the market have stabalized and provide opprotunities for sure. You can get many sellers to offer some concessions to buy down your rate and/or help with closing costs. New construction (inventory homes) will provide great rate buy downs AND closing costs..you get a home that should have no capX and comes with warranties, attracts young families and appreciates a little faster if you can buy in early in a community.
Give me a call if you want to discuss specifics to your needs.
Best of luck.
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Nick Sansivero
Rental Property Investor · Wilmington, NC · Member since 2019 · 69 posts · 51 votes
5mo
Hey @Peter Lee - Here's a high level view of both markets for a quick comparison, obviously you'll want to find an agent to dive deeper:

Fairfax is expensive for SFR, with a $854,032 single-family value and only a 3.49% gross rental yield, but it still shows decent demand with 22 median days on market and a 75% pending listing to active listing ratio.

Orlando is much more attractive on cash flow, with a $400,205 single-family value, a 6.01% gross rental yield, and $2,412 typical single-family rent, but it also looks softer and more saturated, with 13,222 active listings, 67 days on market, and a 21.1% price-reduced share.

So if you want appreciation potential and can accept low yield, Fairfax looks stronger, while Orlando is better if you want a lower entry price and better rental return.

In short, Orlando looks more saturated right now, but Fairfax is the pricier appreciation play.

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Ryan MoyerBusiness Member
Property Manager · Orlando Kissimmee Davenport Salt Lake City, Park City · Member since 2019 · 991 posts · 1k+ votes
5mo
Quote from @Peter Lee:

I am interesting in buying single family rental (SFR) property in Orlando or Fairfax VA. Is Orlando saturated? heard a lot of BTR. Fairfax seems very expensive now. But someone say it appreciates very well. Do you guys want to share your thoughts of the SFR markets in these two places?
Thanks

What is your budget? What do you have to spend on upgrading the property after purchase? What are your goals?
Need a lot more info here. Generic question is just going to get you generic responses.
The answer is going to be totally different if you have a target purchase prices of $600k-$800k and $200k to invest in post purchase upgrades, versus if you're looking for a $300k condo with no money invested after purchase.
The answer is going to be very different if you're looking to maximize ROI versus if you're looking to park some money and maximize tax advantages (for which strategy Orlando is one of the better makets in the country).
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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
5mo
Fairfax, Virginia, you will have negative cash flow on a rental unless you put a significant down payment down. I live in the area, and due to the amount of work, including white-collar and blue-collar jobs, the markets typically don't explode during an upturn nor crater during a downturn.

I also have property in Orlando and great rental areas, a little bit more boom or bust for appreciation. I would say it also depends on your horizon and timeline. If it was something I was going to hold for 20 to 30 years, I would probably pick Fairfax County. If it was something for five years, I would say Orlando. I also do not think you can go wrong in either market.
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Peter Lee
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Member since 2022 · 11 posts · 4 votes
5mo
I am really glad I post my question in this forum. You guys really get me thinking about my investment strategy. That is why it took me a while to reply.

I prefer the traditional way of SFR. Find a tenant and sign a one-year or multiple year lease. Create an income stream. I don't know how reliable I can predict the appreciation in either market. So my thought focuses on good rental demand.

As @Chris Seveney said, in Fairfax the house is very pricy and may end up with negative cash flow. With my situation, I probably can make enough down pay for positive cash flow. I live in this area and understand the tenant tends to be stable and sign multiyear lease for job or school as it takes a while for them to buy the pricy house.

Orlando is known for its tourism. However, I am not that much into airbnb as I have a full time job and not much time left for managing that many short term rentals. I wonder if there are areas in Orlando that attracts families with professional jobs or looking for a good school zone. Or in Orlando, I need to invest in a different theme?

@Hannah McDonald, @Shawn McCormick thank you for sharing that some market is over saturated. I hear about good things abut Lake Nona and also its CDD fee. what do you see the rental market in that area?

I hear about build-to-rent in Orlando and institutional landlord. Want to hear from you how that affect the SFR market.

@Ryan Moyer when I say HOA, I mean if the HOA has more rules regarding rental. Also I think I mixed HOA fee with CDD fee.

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