Condo Buy in Harbour Island, Tampa, FL -
Rental Property Investor · Nashville, TN · Member since 2016 · 31 posts · 9 votes
First-time buyer here looking to invest in rental properties. I'm planning to purchase a 1/1 Condo at 501 Knights Run Ave. on Harbour Island in Tampa Florida for $179k. Remodeled unit and premarket. My dilemma, a new luxury building, 500 Harbor Island, being built across the street. 235 brand new apartments will be available October 1st and I plan to close on 501 Knights Ave. on September 1st. Rents for 1/1 at 500 HI are $1850-2200+ and I was looking to rent my 501 Knights Ave. for $1400-1500 .
Any thoughts on how the supply and demand of this new luxury building should effect, supply and demand, sale prices and rent at 501 Knights Ave and Harbor Island in general? Thank you!
- Joe
https://www.google.com/?gws_rd=ssl#q=501+Knights+R...
Zillow.com says you are in the ball park with your figures, but, why would you buy a Condo. To me that is a dirty word. Condo fees and Absentee Owner spell trouble. All the buyers here in Tampa want to buy new if the older property is a similar price. During the real estate boom that ended in 2008 we built 5000 Condos in Tampa and they keep building them downtown. They are all empty with investors buying them for speculation and they keep on building...In Miami they built 50,000 Condos and they were all empty during the collapse of the Market. Here in Tampa there is a building and only one of the apartments was being lived in. The Condo fees have to be paid and he was the only one paying...that means that every month he was going to be responsible for all the fees or be Foreclosed on. The agents here are hot to sell you a new Condo downtown or on the Island. We have a horrible traffic problem downtown that they cannot solve and they keep on building high rises. One doctor told me that it took him twenty minutes to drive over one of the two bridges from Harbour Island to get ten blocks away to go to the Publix Market. The reason people wanted to buy in the new developments outside of Tampa, was because they could buy a lot more for cheaper. Then, they found out they had a horrible commute! On a good day it was 20 to 30 minutes to get downtown to go to work. On a normal day now it can be two hours. So, they decided to move to S. Tampa and we have had a boom in building on everything south of Kennedy Blvd. and downtown. But, that fifteen minute commute now can be an hour with all the traffic trying to go North to downtown on four main roads. The lines are endless to get through all the hundred lights downtown and crossing the main roads. And it just gets worse and there is no solution at all. Another thing about Condos. The Condo Association is a hostile entity. The Condo Administrator is always a thief who does not live in the Condo and usually not even in the State. The normal things are usually done around the buildings, but, major repairs are left behind and the Administrator steals money from the Condo fees to live a better life somewhere else. Ten years later the tenants get a letter with a Special Assessment for a new roof or fencing or pool upgrades or painting the building etc. That can be thousands of dollars for each tenant and some cannot pay and they start selling out. So, how old the building is can be a concern. You don't want to buy into the Special Assessment cycle. Harbour Island and Davis Island are ground zero for any hurricane that comes up Tampa Bay. The high of the water level downtown could be twenty feet. Look at the flood maps downtown that no one pays attention to. Its all go go, buy buy downtown and all empty and abandoned at night. We just moved back to our property on the Hillsborough River across from the Lowry Park Zoo. Our flood policy was a thousand dollars and just went up to over three thousand. The governments plan is to raise the Flood Insurance ten percent a year until you are paying tens of thousands a year, just like Obama Care. There is no way we can sustain these costs. The Utility bills for light and water are projected by the County to go up at least ten percent a year. My girlfriend is an Accountant at the County. Our tenants are all struggling, ordinary people. I don't have any lawyers or doctors or suit and tie guys as renters. They get in trouble every day and all I hear are excuses. The wave these days is to pay the light and water and not the rent and ask to pay partial payments and on and on with the negatives. I have had rentals here for thirty years and I am selling out while I still can before the next downturn which we believe will last for twenty or more years. That Condo today, could be worth half that amount next year. You would do better to wait to see what happens after the Election and how they are going to solve all the problems that drag down our economy. Be like Warren Buffett and Donald Trump and look for the next downtrend to pick up real estate near you for pennies on the dollar. Fix it up and then rent it if you can stand being a landlord.
https://www.google.com/?gws_rd=ssl#q=501+Knights+R...
Zillow.com says you are in the ball park with your figures, but, why would you buy a Condo. To me that is a dirty word. Condo fees and Absentee Owner spell trouble. All the buyers here in Tampa want to buy new if the older property is a similar price. During the real estate boom that ended in 2008 we built 5000 Condos in Tampa and they keep building them downtown. They are all empty with investors buying them for speculation and they keep on building...In Miami they built 50,000 Condos and they were all empty during the collapse of the Market. Here in Tampa there is a building and only one of the apartments was being lived in. The Condo fees have to be paid and he was the only one paying...that means that every month he was going to be responsible for all the fees or be Foreclosed on. The agents here are hot to sell you a new Condo downtown or on the Island. We have a horrible traffic problem downtown that they cannot solve and they keep on building high rises. One doctor told me that it took him twenty minutes to drive over one of the two bridges from Harbour Island to get ten blocks away to go to the Publix Market. The reason people wanted to buy in the new developments outside of Tampa, was because they could buy a lot more for cheaper. Then, they found out they had a horrible commute! On a good day it was 20 to 30 minutes to get downtown to go to work. On a normal day now it can be two hours. So, they decided to move to S. Tampa and we have had a boom in building on everything south of Kennedy Blvd. and downtown. But, that fifteen minute commute now can be an hour with all the traffic trying to go North to downtown on four main roads. The lines are endless to get through all the hundred lights downtown and crossing the main roads. And it just gets worse and there is no solution at all. Another thing about Condos. The Condo Association is a hostile entity. The Condo Administrator is always a thief who does not live in the Condo and usually not even in the State. The normal things are usually done around the buildings, but, major repairs are left behind and the Administrator steals money from the Condo fees to live a better life somewhere else. Ten years later the tenants get a letter with a Special Assessment for a new roof or fencing or pool upgrades or painting the building etc. That can be thousands of dollars for each tenant and some cannot pay and they start selling out. So, how old the building is can be a concern. You don't want to buy into the Special Assessment cycle. Harbour Island and Davis Island are ground zero for any hurricane that comes up Tampa Bay. The high of the water level downtown could be twenty feet. Look at the flood maps downtown that no one pays attention to. Its all go go, buy buy downtown and all empty and abandoned at night. We just moved back to our property on the Hillsborough River across from the Lowry Park Zoo. Our flood policy was a thousand dollars and just went up to over three thousand. The governments plan is to raise the Flood Insurance ten percent a year until you are paying tens of thousands a year, just like Obama Care. There is no way we can sustain these costs. The Utility bills for light and water are projected by the County to go up at least ten percent a year. My girlfriend is an Accountant at the County. Our tenants are all struggling, ordinary people. I don't have any lawyers or doctors or suit and tie guys as renters. They get in trouble every day and all I hear are excuses. The wave these days is to pay the light and water and not the rent and ask to pay partial payments and on and on with the negatives. I have had rentals here for thirty years and I am selling out while I still can before the next downturn which we believe will last for twenty or more years. That Condo today, could be worth half that amount next year. You would do better to wait to see what happens after the Election and how they are going to solve all the problems that drag down our economy. Be like Warren Buffett and Donald Trump and look for the next downtrend to pick up real estate near you for pennies on the dollar. Fix it up and then rent it if you can stand being a landlord.
There are 3-1 BR units in that development available for rent in that development right now for $1300/mo... if you hold out for $1400 to $1500 you will probably be looking at high vacancy rates based on that alone and should to adjust your pro forma accordingly.
Also, If the rules are the same as they were a few years ago it is a challenge to have visitors with the parking and the rules around it.
The only 1BR to get $1500 in the last six months was a first floor unit with a loft at 934SF... it took over 6 weeks to get a qualified tenant. If you have a typical 1 BR in the development at around 650-800SF range... the rents are $1300.
First, thank you, Michael Haynes and Rober Wilson. That answers a lot of the speculations and concerns that I had going into buying anything in the Tampa area.
A little more on my background and why I'm investing down in Tampa. I've been living and renting in Brooklyn and have wanted get into REI for quite some time but don't see any value in my area. I've never wanted to invest in Florida for a lot of the reasons mentioned above but have key assets living and working in the area. My brother in law and several family members are realtors, brokers, property managers, and investors in the Tampa area, which offers me great insight into the market without actually being there.
The 'family team' I'm working with is very adamant on the fact that while the numbers on cash flow are poor the value of equity to gain in 2-3 years is very high around 35-40k. A few of them own condos on the island and have seen the numbers grow around 20k per year. With the additional building of luxury condos around Harbour Island ,they have told me that the value of properties will continue to rise rapidly and in 2-3 years you won't be able to buy a 1/1 for less than 250k. It's also promising when I see them making purchases in the same development, 501 Knights Run Ave, that they want me to get into.
I've attached my spreadsheet to just show my numbers as I would like to get more feedback on the potential of this investment. I'm considering making an offer at $175k down from $180k to just see if I can grab that better deal.
If that doesn't go through I'm looking to buy a 900 sq. ft. Townhouse. 1/1 w/ office, balcony, attached garage, and fully furnished on 779 Mainsail Drive from a friend for $195-200k. Market value in that area around $220-225
k. I'm thinking short term vacation rentals or $1700-1800 long term. Seemingly a way better deal? http://www.zillow.com/homedetails/779-Mainsail-Dr-...
Thank you for the help!
If it was me: pass. No profit made on the purchase.
Based on your income spreadsheet. I would pass on that deal. I do not see a real profit each month. Looks like a loosing deal.
Would be interested hearing a few more opinions on this condo at 501 KNIGHTS RUN AVE, #1219 on Harbor Island, Tampa. Crunched the numbers again with some new info. I'm still leaning heavily towards no but, wanted to get some feedback as to why it might be a good investment and why it wouldn't be a good investment. Decent cash flow and heavy appreciation. Thanks in advance!