Looking to buy and hold in Orlando, FL
Investor · miami, FL · Member since 2018 · 46 posts · 7 votes
The Miami housing market is really inflated. Therefore, I started looking in the Orlando market. I don't know much about Orlando's market except that it is a fast and growing city. Anybody in Orlando care to share your experience, rent market, and vacancy rate in Orlando? I would appreciate it. I am looking to buy and hold multi-family properties.
@Jupshy Jasmin Don't limit your search to just Orlando Proper. There are some really high prices in the most desirable neighborhoods in Orlando (Dubs Dread, College Park, etc). There are definitely investors making money in those areas from flips and buy and holds, maybe some will chime in here with their strategies. From what I've seen, the market rents in the high priced Orlando areas don't exceed surrounding areas to the extent that prices do. Instead of focusing on Orlando, look to the outskirts of Orlando where all of the growth is happening: Apopka, Lake Nona, Winter Garden, Oviedo.
I'm in Apopka, which is Northwest of Orlando by about 20-30 mins but within easy commute of anywhere in the "Orlando Area" thanks to direct toll road access in town. From 1990 to current day, Apopka has exploded from somewhere around 15,000 people to over 50,000, and builders are selling new houses as fast as they can build them. I know in my area, prices have appreciated rapidly, but are still much behind Orlando Proper. A distressed 3/2 house may go for $180-200k in College park, with ARV somewhere in the $400's. Rent for that house when complete might be about $1700. The same exact distressed house built in the same year in Apopka would sell somewhere in the $80-100k range with ARV in the $180-220k range. Same house, nearly double the value in Orlando (likely easier to turn a flip profit since these hypothetical identical rehabs would cost the same to your contractor in either place). However, in Apopka, you could easily rent that rehabbed house for $1550-1650 compared to $1700 for the one worth twice as much in Orlando.
Those are all approximate numbers not based on two specific properties, but rather characteristic of properties I have been analyzing. I'm more familiar with Apopka than other Orlando Suburbs, but I would bet the same type higher rent to price situation exists in the growing edges of the "Orlando Sprawl" on all sides.
@Jupshy Jasmin Don't limit your search to just Orlando Proper. There are some really high prices in the most desirable neighborhoods in Orlando (Dubs Dread, College Park, etc). There are definitely investors making money in those areas from flips and buy and holds, maybe some will chime in here with their strategies. From what I've seen, the market rents in the high priced Orlando areas don't exceed surrounding areas to the extent that prices do. Instead of focusing on Orlando, look to the outskirts of Orlando where all of the growth is happening: Apopka, Lake Nona, Winter Garden, Oviedo.
I'm in Apopka, which is Northwest of Orlando by about 20-30 mins but within easy commute of anywhere in the "Orlando Area" thanks to direct toll road access in town. From 1990 to current day, Apopka has exploded from somewhere around 15,000 people to over 50,000, and builders are selling new houses as fast as they can build them. I know in my area, prices have appreciated rapidly, but are still much behind Orlando Proper. A distressed 3/2 house may go for $180-200k in College park, with ARV somewhere in the $400's. Rent for that house when complete might be about $1700. The same exact distressed house built in the same year in Apopka would sell somewhere in the $80-100k range with ARV in the $180-220k range. Same house, nearly double the value in Orlando (likely easier to turn a flip profit since these hypothetical identical rehabs would cost the same to your contractor in either place). However, in Apopka, you could easily rent that rehabbed house for $1550-1650 compared to $1700 for the one worth twice as much in Orlando.
Those are all approximate numbers not based on two specific properties, but rather characteristic of properties I have been analyzing. I'm more familiar with Apopka than other Orlando Suburbs, but I would bet the same type higher rent to price situation exists in the growing edges of the "Orlando Sprawl" on all sides.
@ Russell, like I mentioned, I dont know about the Orlando area, better yet the outskirts. Tell me a little more about you do. Please message me your contact information.
@Jupshy Jasmin I just now saw this, sorry! I'll send you a PM. I guess I missed the fact you were looking for multi family in my use of SF as an example, but the same basic premises apply as far as rent outpacing values. Several national builders are putting townhouse or rowhouse type MF in Apopka and selling each unit quickly in the low 200s. Most are building 6-8 unit buildings, each unit being 2 stories with 3 bedrooms and a one or two car garage. There have also been two large apartment complexes recently built MF is a bit less common on the market in the outskirts areas as there is less inventory of that type housing. However, there is a steady 'trickle' of duplexes and quads that I have seen come across the market.
With the incredibly strong rental demand and limited supply of small multis, I have been talking with a few investors about getting together a plan and funding for building new duplexes or quads on some vacant land. It's just an abstract theory at this point and much more analysis would be needed to see if it is profitable, but in theory I feel it would be feasible to rent as many 2/2 or 3/2 multifamily units as you could build, as quickly as they could be built, for $1100-1200/mo for 2/2 or $1500-1800/mo for 3/2. The numbers on whether it would be profitable as a build and sell model remains to be seen.
I think Apopka is a really great market for various investment strategies, but every investor is different. I'll send you a PM to get more info on what you're looking for.
@Russell Holmes
Thanks for your thorough explanation. That is very informative and helpful. My family is considering moving to Orland and surrounding area, when we'll need to buy our own house plus rental investment. Still doing our research to make decisions. It would be great if I can connect with you to learn more if we decide to move.