To Sell Or To Hold In Fort Lauderdale
I own a 1 bedroom in Fort Lauderdale near the airport, beach, Las Olas, etc. I'm fairly new to the investor community so I'm stuck in the research phase. I've been going back and forth on whether to sell my condo or rent it out.
Here's the math: Mortgage, Taxes, PMI and Insurance are $685/mo and HOA is $250/mo. I think the rental market in the area calls for about $1200 for a 1br. Using the rental property formulas, this seems like it isn't worth keeping for cash flow.
From the recent sales I've seen in the area, 1br go for 130k-165k so selling may or may not leave me with about 50k after closing. That's money I could use to invest in another market.
I know most of my doubt is based on emotional attachment to the area and it being my first home so maybe having some experts chime in might help. Is there anything else I should be looking at?
#3 Starting Out Contributor
- Specialist
- Mendham, NJ
Ft. Lauderdale, notwithstanding COVID impact, is a pretty solid rental market, but also can be a bit sketchy on tenants. I lived there for 7 years. Are you in an AirBnb use location or too far from the beach? I like Ft. Lauderdale for AirBnb, but you have to be on top of the upkeep and have a full plan. For people who buy condos as their first buy, I think it helps to rent it for a year as long as it is positive to see how you like being a landlord so that can help inform you on your future REI journey.
This is a great time to sell and who knows what will happen next. If you think you might want to sell within the next 5 years, I'd consider selling soon.
@Sheila Grullon - tough call! The reason to sell is that the condo market has been moving towards buyers and Covid has merely put a halt to that, but once we get that under control, there's a very good chance sellers will flood the market again. Thus chances are that prices will go down a tad. That's good reason to sell now.
On the flip side, your place is in Harbordale which is desirable and still affordable (given that it's east of US1). You can walk to eat, ride your bike to the beach and a short Uber to most places. I don't know your building's rules on AirB&B, however it would certainly be set in the right location. I bet you'd easily get cruisers staying there - it's right near Port Everglade.
Originally posted by @Tchaka Owen:@Sheila Grullon - tough call! The reason to sell is that the condo market has been moving towards buyers and Covid has merely put a halt to that, but once we get that under control, there's a very good chance sellers will flood the market again. Thus chances are that prices will go down a tad. That's good reason to sell now.
On the flip side, your place is in Harbordale which is desirable and still affordable (given that it's east of US1). You can walk to eat, ride your bike to the beach and a short Uber to most places. I don't know your building's rules on AirB&B, however it would certainly be set in the right location. I bet you'd easily get cruisers staying there - it's right near Port Everglade.
Tchaka, this is exactly what I've considered hanging onto it. It's a very desriable area with tons of amenities and probably more to come. If my HOA allowed short term rentals, I wouldn't even consider letting it go. I often wonder how difficult it would be to convince the board to change the rules. Thats a challenge for a different day though.
Thanks for your reply!
Just listened to a BP podcast that answered your EXACT question!
Q: why would I keep this property and only make X per month when I could sell it and make $50K?
A: "BP podcast #398.22 - BRRRR Properties in under 10 hours per week with Tarl Yarber".
question Starts at time 40:30 and answer ends around 40:33, 3 minutes.
To summarize, in the short run you’ll be very happy to sell and get the money. In the long run you’ll be very happy you kept it as a rental.
I know this is true because I bought 2 identical properties for $50k in 2000. In 2005 I sold 1 for $175k, making a whopping profit and return. A triple!! For 10 years I was SO HAPPY I sold it. I kept the other one that I still have today. Now that it’s 20 years later, I am SO HAPPY that I kept the 2nd one because it’s paid for and throwing off $750 a month and the money from the first one I sold 15 years ago has been spent, long ago.
So I was happy with both decisions. But one is longer term happiness than the other. And for 10 years I was wondering why I didn’t sell them both when the value dropped Back down to $90k in 2008. But Now, in 2020, I wonder why I didn’t keep them both.
As a side note, I am now under contract to buy another (3rd one) in the same complex for 138k. Because I want the cash flow. Cash flow is king.
Honestly, you’ll be happy either way. Once you Make a decision, don’t look back. You’ve got a great “problem” to have. Check out that podcast.
What are your thoughts right now on tarpon river in fort lauderdale?
- Real Estate Broker | Investor | Property Manager
- Plantation, FL
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Originally posted by @Mike Rodriguez:What are your thoughts right now on tarpon river in fort lauderdale?
The Tarpon River area is a great area right now in FLL. With all the growth in the city, it is feeding positive change out and around the area. Are you thinking of selling in that area or picking up a property?
Happy to help!
Hi! @Kevin Kohler What kind of demographic are renting there? Where do you learn about new developments going there?
Just researching different areas for now, not exactly sure what I want
- Real Estate Broker | Investor | Property Manager
- Plantation, FL
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well, a quick snapshot of the neighborhood shows 44 properties rented in the last 6 months. 23 currently available. Recently rented units range from $1,000/month for a small studio to $3,350 for a 4br 3ba townhome with a garage. You see more established young professionals living in this area along with a mix of snowbirds for the condo buildings. It is a desirable area due to proximity to everything and being on south side of the river gives the neighborhood a calmer feeling than the "downtown lauderdale" vibe along Las Olas and the surrounding area.
@Mike Rodriguez I sent you a connection request. Let's chat further!
@Kevin Kohler Sounds great! And what do you think efficiencies rent for in that area?
@Kevin Koffman Wow! Not sure how I missed your response but you are spot on! It's definitely a good problem to have. I think the short term satisfaction of getting out some equity is attractive but I've decided to hang onto it and see how it does as a rental. The neighborhood keeps changing and I think 20 years down the line, I'll be happy I have a little piece of it paid off and making me a pretty decent penny every month.
Thanks to everyone for the advice!