Is this home a good value?

9 Replies

Hi Everyone!

I am a new investor trying to get my feet wet in real estate and I am trying to learn how to analyze rental properties. I found this home on Zillow listed at $93,000 in Orlando, Florida that I wanted to potentially rent out to tenants. It's a single-family home located right on a lake with 3 bedrooms, 2 bathrooms, and is 1,850 square feet. It is already in pretty good shape and I have calculated the financials and the cash flow it could potentially bring me. Zillow is giving its "Zestimate" at an average of around $209k for similar properties with the same specs. I am just wondering if I stumbled upon a great deal or if this isn't as accurate as I think it is? Any feedback would be much appreciated! I will link the property at the bottom of this post if any of the more experienced investors want to check it out for me.

Happy hunting!

Kaleb

https://www.zillow.com/homedetails/5458-Jean-Dr-Orlando-FL-32822/2081557803_zpid/

Zillow is crap.  Also, it is hard to analyze a buy and hold without knowing what it will rent for.  It it would rent for $400/month it is not a good deal as a buy and hold.  If it will rent for $4000/month then it is a great deal as a buy and hold.  But back to my first point, Zillow is crap.  Don't make any investing decisions off of Zillow info.  You need local information.  I would contact a realtor in that area.  It is unlikely that you have found a property for sale for 45% of what it is worth, especially in this sellers market.

Originally posted by @Eli Schwartz :

Hi @Kaleb Adam Barlow Welcome to BP and to real estate investing.

I would never trust any of Zillow's numbers. You should check with a local agent what it could rents for, what the ARV is etc.

Best of luck 

 Thank you for the information, I'll look into that!

Originally posted by @Jacob Sampson :

Zillow is crap.  Also, it is hard to analyze a buy and hold without knowing what it will rent for.  It it would rent for $400/month it is not a good deal as a buy and hold.  If it will rent for $4000/month then it is a great deal as a buy and hold.  But back to my first point, Zillow is crap.  Don't make any investing decisions off of Zillow info.  You need local information.  I would contact a realtor in that area.  It is unlikely that you have found a property for sale for 45% of what it is worth, especially in this sellers market.

 Hi Jacob,

I appreciate the info! What sites would you recommend as a starting point when looking for rental properties?

I only invest in my local area so most of my deals are found through relationships or my realtor.  I think investing, especially when starting out, is difficult to do outside of your own area.

Hi @Kaleb Adam Barlow and welcome to the investing world! I'd be curious where the property is and what it can rent for, first. I try going to rentometer.com first to look for rental amounts in the area, then based on what that says, I'll research what I can find in the MLS system. $93k sounds low for a place on decent shape, especially waterfront, for this area. Zillow is a joke...if it were anywhere close to accurate, I'd have a sign in my yard right now so I can take my equity and run! Feel free to reach out if there's anything I can help you with.

It's easy enough to look on for similar listings online. But I can tell you, compared to other properties in Orlando, this is too good to be true. 3 BR properties that look like this, without a lake, easily go for about 2x that much. This is a FSBO (for sale by owner), so they're not expecting to pay a realtor's commission. But if you try another post, with "Orlando" in the subject, realtors in that market will see it and reply to you. I can recommend someone if you PM me.

@Kaleb Adam Barlow Some call outs... this is in a 55+ community which means your rental pool is immediately smaller. Also there may be a lot fee which means you don't own the ground. Good part of Orlando though. Manufactured homes do not keep their value like stick or block built. You should also never use zillow estimates it is not a true comparison tool. 

like others have mention here, sounds too good to be true. I´m also new to this kind of deals and I´ve been lookng in Orlando through a realtor and haven´t found anything yet that meets my criteria. It´s tough to find something that can cash flow. 

Agree that the safest thing to do is to find a good realtor that can go with you in this process.