Looking to purchase my first AirBNB in Panama City Beach!
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Real Estate Agent · Fort Walton Beach, FL · Member since 2018 · 219 posts · 275 votes
4y@Adam Rose you are getting some really great, if diverse and therefore somewhat confusing opinions, lol. Either way, it's good info and hopefully helpful. One of the best things about Bigger Pockets is that you will get these diverse opinions that will allow you to make an educated decision. See my two cents below:
1) Most of us commenting here on your post are real estate agents (myself included). What that means is that (probably) most of us are very familiar with the market, the various complexes and how they will perform potentially. That said, most of us can't quite disassociate with the idea that you might be a potential client for one of us. So, I would suggest, read everything with that in mind. I will try to pretend like I'm not an agent and will give you my most honest opinion as an investor.
2) Whether you consider condos or not will depend on not only your budget and financing options (most ARE non-warrantable) but also on how you plan to manage the property. Will you self-manage or will you use a full-service management company? Will you use mostly Airbnb or mostly VRBO or your own direct site? The reason these things matter is that some complexes like Edgewater, Shores of Panama, Tidewater and others will make it EXTREMELY difficult for someone who is self-managing. It's doable, but it's hard. Trust me, lol. There are a handful of management companies that have monopolized most of the large complexes and being the small newcomer is hard. Try getting parking for your cleaning people at Tidewater in the middle of the summer season, lol.
3) If you MUST do a condo (for example because you definitely want to have a direct beach view), then I would look on the WEST side, closer to 30A and away from Edgewater and Shores of Panama (legal issues here in addition to THIS WILL NOT CASH FLOW unless you are some sort of magician :-)). I like EMERALD ISLE (Different from Emerald Beach. Emerald Beach is the definition of condotel and cashflow there will be super hard. Nice place to stay on vacation, but not my pick for investment. I like Splash (if you must) and Aqua (more expensive). I don't like any condos down Thomas Dr. I really like ENDLESS SUMMER toward the west end. No beach views here, but if you want to use Airbnb rather than a mgmt company charging 25%+, this is a great option and it can cashflow. If you gotta go closer to the center and be in a beachfront condo, I like Ocean Reef. You will probably need to remodel some in order to get your rental $$ to where they need to be. But buying something completely remodeled there will be paying unnecessary premium. You could potential self-manage at Majestic Beach Tower, but it's an average pick of mine. As for Calypso.... if someone invites you to stay at their condo there, definitely go. You will enjoy it. Newer (if gaudy) nice complex with great amenities. If you are buying... this is super expensive per sq ft and will NOT cashflow. Also, keep in mind that Calypso III (the newest one) is NOT on the beach and even if some of the higher floors currently have some sort of sideways beach view, that will soon go away as active construction is going on directly in front on that view (which also overlooks the busy street, the mall side streets, and a bunch of parking).
4) I'm going to go with @Ricardo Hidalgo on several points here. Cashflow right now is tight, so condos are hard to squeeze for cash unless you get a super deal and then you self-manage the heck of it. If you are buying with a long-term view in mind and absolutely would like to be on the beach, than you may need to prepare for a few years of near break-even or even losses with beachfront condos (again depends on revenue and mgmt fees). If you can buy and remodel that would help you negotiate a better price of a "less updated/desirable unit" in your selected location, so potentially will get you increased value in the future. If you buy turnkey at today's prices that will be harder. I also REALLY LIKE townhouse in PCB. There are many, they finance better, they are easier to resell, they are available in different price ranges, etc. (Just prepare for higher insurance. Still less than the condo HOAs.). Look into Gulf Highlands Resort -- all townhouse and directly across from Majestic Beach Tower, Horizon South complex has some units that are actually townhouses. A number of townhouse options on the west end and in Sunnyside/Laguna/Riviera. If you MUST go to Thomas Dr, then look at the various townhouses there. Again, if you can do some updating rather than looking for "turn key", you will probably get a better deal.
5) Get a LOCAL lender!!!!
6) The good news is that as the market is right now, you will not need to make all cash offers with $$$ appraisal contingency waivers, etc like you would have in March of this year :-).
7) Rental projections: these are useful ... to a point. If you buy a unit with brown carpet and yellow walls and rental projections of $40K, chances are that might change if you update the unit and self-manage or use another mgmt company. If you are NOT looking to self-manage, then definitely approach your purchase from that perspective and make sure you buy something that will be in location where good management is available. I.e. don't buy a house 5 miles away from everything that no manager will want to deal with :-). If you plan on using a certain management company, then use their rental projections. In some complexes you almost have to use certain ones. Picking on Tidewater again, lol. Vacasa manages over 100 units there and has a front desk on the second floor. Imagine a confused guest family who finally make it out of the parking structure, get inside the lobby and are trying to get their magnetized wristbands (you can't open any doors without those at Tidewater). And lo and behold, their management company is not Vacasa or Panhandle Getaways or another big one and they are lost.... and the person at the Vacasa desk gives them "the look", lol. (Sorry, I've shown a bunch at Tidewater, so I have stories, lol.)
I really like PCB as an investment option. I almost bought there this spring (a unit in Endless Summer), but I ended up buying a townhouse on Okaloosa Island (FWB) instead.
Good luck!!!
15 Replies
- Real Estate Agent · Panama City Beach, FL · Member since 2021 · 19 posts · 8 votes4y
You are absolutely right, Panama City Beach is a great place to jump into the short term rental market. I started investing here six years ago. I now own and self manage multiple STR's, moved here and began selling real estate exclusively to STR investors. I know the market and different condo complexes well and would love to help you get started.
Feel free to reach out anytime!
Chris
- Realtor · OK · Member since 2020 · 139 posts · 165 votes4y
@Adam Rose Let's get into it! I added the picture because its easier to visualize the area when looking at a map. On the image I have marked all the beach front condo's that meet the intent of what you are looking for between $200k and $600k, which is the typical budget for a majority of STR investors I work with looking to pickup a condo. You already mentioned Emerald Beach and Edgewater condos which are great but I added some more for you to consider. Treasure Island didn't make the cut because the lowest priced unit is at $710k and the rental projections were around $50k so not very competitive in my view. I recommended the condos below because they had more amenities for guests, are on the beach (except for Lake Town Wharf) and have units actively for sale. I also wanted to give you the heads up on Shores of Panama because it looks great in photos but has some struggles and now there is some drama between the HOA and owners. Personally I like eastern PCB because the data from price labs supports higher ADRs in that area. I hope this helps answers some of your questions, if there is anything else you want me to do like pull rental projections or run cashflow analysis just shoot me a DM and I'll get it over to you.
1. Splash Condo | Annual HOA $6,752 | Google Stars 4.1 1,412 Google reviews
2. Tidewater | Annual HOA $7,805 |Google Stars 4.0 2,662 Google reviews
3. Emerald Beach Resort | Annual HOA $11,987 | Google Stars 4.3 540 Google reviews
4. Edgewater | Annual HOA $8,320 | Google Stars 4.2 3,496 Google reviews
5. Shores of Panama (currently a bit spicy here with a lawsuit to prevent an assessment More Info Here) | Annual HOA $9,352 |Google Stars 3.5 4,135 Google reviews
6. Lake Town Wharf (not beachfront but very popular with investors, can get a 3bd for $550k) | Annual HOA $9,772 | Google Stars 4.1 4,308 Google reviews
7. Summer House Condo | Annual HOA $6,516 | Google Stars 4.4 343 Google reviews
8. Regency Towers | Annual HOA $6,546 | Google Stars 4.1 1,086 Google reviews
- Real Estate Agent · Member since 2019 · 569 posts · 257 votes4y
Quote from @Adam Rose:
Hello Everyone,
I'm looking for a bit of guidance. I'm interested in purchasing my first AirBNB property, and have found a place I think I would love to invest, Panama City Beach! I've visited the area a few times, and it seems that they are trying to distance themselves from their prior party roots. I'd really like to purchase a beachfront condo, rather than housing elsewhere in the city. My question is threefold. First, what condo resorts would you recommend looking for properties? I've heard from locals that Treasure Island, Emerald beach are good places to look. I also have a friend who has a condo at Edgewater that I really liked. Secondly, for any resorts that are preferential, what makes them stand apart from the others (better HOAs, no special assessments, higher occupancy, cheaper HOA cost to amenities provided etc). Finally, I'm interested in beachfront as that's where I would like to stay when I visit, but I would be open to hear about other ideas that have better ROI if there any.
Thanks,
Adam Rose
Full transparency: I showed all the gulf front condos this week including the big names: tidewater, majestic, Emerald Isle, grand Panama and tidewater etc. They aren't cash flowing. The best options is buying a townhome that needs to be renovated or a beach house that is on the west side or laguna beach. Condo tends to jump the quickest in prices during an appreciation based market. I think condos will be good options when the market settles down. In addition, condos require 25-35% since they are non-warrantable. You can get away with 15-20% down on townhomes or beach houses!
- Realtor · OK · Member since 2020 · 139 posts · 165 votes4y
Quote from @Ricardo Hidalgo:
Quote from @Adam Rose:
Hello Everyone,
I'm looking for a bit of guidance. I'm interested in purchasing my first AirBNB property, and have found a place I think I would love to invest, Panama City Beach! I've visited the area a few times, and it seems that they are trying to distance themselves from their prior party roots. I'd really like to purchase a beachfront condo, rather than housing elsewhere in the city. My question is threefold. First, what condo resorts would you recommend looking for properties? I've heard from locals that Treasure Island, Emerald beach are good places to look. I also have a friend who has a condo at Edgewater that I really liked. Secondly, for any resorts that are preferential, what makes them stand apart from the others (better HOAs, no special assessments, higher occupancy, cheaper HOA cost to amenities provided etc). Finally, I'm interested in beachfront as that's where I would like to stay when I visit, but I would be open to hear about other ideas that have better ROI if there any.
Thanks,
Adam Rose
Full transparency: I showed all the gulf front condos this week including the big names: tidewater, majestic, Emerald Isle, grand Panama and tidewater etc. They aren't cash flowing. The best options is buying a townhome that needs to be renovated or a beach house that is on the west side or laguna beach. Condo tends to jump the quickest in prices during an appreciation based market. I think condos will be good options when the market settles down. In addition, condos require 25-35% since they are non-warrantable. You can get away with 15-20% down on townhomes or beach houses!
I wouldn’t put a blanket statement that all condos are not warrantable. Some of the lenders we work with like Joe at Midwest Bank Centre have more flexible condo questionnaires that can qualify a condo as warrantable when other lenders can’t. As long as the loan is conforming, below $647,200, it will qualify for that 10% down second home loan. As for not cash flowing I think the market is at a point where buyers can negotiate on price. So writing an offer at a price point that gets you net positive cash flow is a possibility.
- Atlanta · Member since 2022 · 718 posts · 648 votes4y
Quote from @Kevin Pillow:
Quote from @Ricardo Hidalgo:
Quote from @Adam Rose:
Hello Everyone,
I'm looking for a bit of guidance. I'm interested in purchasing my first AirBNB property, and have found a place I think I would love to invest, Panama City Beach! I've visited the area a few times, and it seems that they are trying to distance themselves from their prior party roots. I'd really like to purchase a beachfront condo, rather than housing elsewhere in the city. My question is threefold. First, what condo resorts would you recommend looking for properties? I've heard from locals that Treasure Island, Emerald beach are good places to look. I also have a friend who has a condo at Edgewater that I really liked. Secondly, for any resorts that are preferential, what makes them stand apart from the others (better HOAs, no special assessments, higher occupancy, cheaper HOA cost to amenities provided etc). Finally, I'm interested in beachfront as that's where I would like to stay when I visit, but I would be open to hear about other ideas that have better ROI if there any.
Thanks,
Adam Rose
Full transparency: I showed all the gulf front condos this week including the big names: tidewater, majestic, Emerald Isle, grand Panama and tidewater etc. They aren't cash flowing. The best options is buying a townhome that needs to be renovated or a beach house that is on the west side or laguna beach. Condo tends to jump the quickest in prices during an appreciation based market. I think condos will be good options when the market settles down. In addition, condos require 25-35% since they are non-warrantable. You can get away with 15-20% down on townhomes or beach houses!
I wouldn’t put a blanket statement that all condos are not warrantable. Some of the lenders we work with like Joe at Midwest Bank Centre have more flexible condo questionnaires that can qualify a condo as warrantable when other lenders can’t. As long as the loan is conforming, below $647,200, it will qualify for that 10% down second home loan. As for not cash flowing I think the market is at a point where buyers can negotiate on price. So writing an offer at a price point that gets you net positive cash flow is a possibility.
if you are putting 10% down for second home loan, wouldnt you be paying mortgage insurance?
- Member since 2022 · 2 posts · 0 votes4y
Quote from @Trent Reeve:
Quote from @Kevin Pillow:
Quote from @Ricardo Hidalgo:
Quote from @Adam Rose:
Hello Everyone,
I'm looking for a bit of guidance. I'm interested in purchasing my first AirBNB property, and have found a place I think I would love to invest, Panama City Beach! I've visited the area a few times, and it seems that they are trying to distance themselves from their prior party roots. I'd really like to purchase a beachfront condo, rather than housing elsewhere in the city. My question is threefold. First, what condo resorts would you recommend looking for properties? I've heard from locals that Treasure Island, Emerald beach are good places to look. I also have a friend who has a condo at Edgewater that I really liked. Secondly, for any resorts that are preferential, what makes them stand apart from the others (better HOAs, no special assessments, higher occupancy, cheaper HOA cost to amenities provided etc). Finally, I'm interested in beachfront as that's where I would like to stay when I visit, but I would be open to hear about other ideas that have better ROI if there any.
Thanks,
Adam Rose
Full transparency: I showed all the gulf front condos this week including the big names: tidewater, majestic, Emerald Isle, grand Panama and tidewater etc. They aren't cash flowing. The best options is buying a townhome that needs to be renovated or a beach house that is on the west side or laguna beach. Condo tends to jump the quickest in prices during an appreciation based market. I think condos will be good options when the market settles down. In addition, condos require 25-35% since they are non-warrantable. You can get away with 15-20% down on townhomes or beach houses!
I wouldn’t put a blanket statement that all condos are not warrantable. Some of the lenders we work with like Joe at Midwest Bank Centre have more flexible condo questionnaires that can qualify a condo as warrantable when other lenders can’t. As long as the loan is conforming, below $647,200, it will qualify for that 10% down second home loan. As for not cash flowing I think the market is at a point where buyers can negotiate on price. So writing an offer at a price point that gets you net positive cash flow is a possibility.
if you are putting 10% down for second home loan, wouldnt you be paying mortgage insurance?
@Trent Reeve Yep, you would be paying PMI, which would eat into your cash flow. @Ricardo Hidalgo I am also looking into this market, you mentioned beach houses on the west side, where is that?
- Realtor · OK · Member since 2020 · 139 posts · 165 votes4y
@Trent Reeve yeah you would be paying PMI.
- Real Estate Agent · Member since 2019 · 569 posts · 257 votes4y
Quote from @Jeremy Mappus:
Quote from @Trent Reeve:
Quote from @Kevin Pillow:
Quote from @Ricardo Hidalgo:
Quote from @Adam Rose:
Hello Everyone,
I'm looking for a bit of guidance. I'm interested in purchasing my first AirBNB property, and have found a place I think I would love to invest, Panama City Beach! I've visited the area a few times, and it seems that they are trying to distance themselves from their prior party roots. I'd really like to purchase a beachfront condo, rather than housing elsewhere in the city. My question is threefold. First, what condo resorts would you recommend looking for properties? I've heard from locals that Treasure Island, Emerald beach are good places to look. I also have a friend who has a condo at Edgewater that I really liked. Secondly, for any resorts that are preferential, what makes them stand apart from the others (better HOAs, no special assessments, higher occupancy, cheaper HOA cost to amenities provided etc). Finally, I'm interested in beachfront as that's where I would like to stay when I visit, but I would be open to hear about other ideas that have better ROI if there any.
Thanks,
Adam Rose
Full transparency: I showed all the gulf front condos this week including the big names: tidewater, majestic, Emerald Isle, grand Panama and tidewater etc. They aren't cash flowing. The best options is buying a townhome that needs to be renovated or a beach house that is on the west side or laguna beach. Condo tends to jump the quickest in prices during an appreciation based market. I think condos will be good options when the market settles down. In addition, condos require 25-35% since they are non-warrantable. You can get away with 15-20% down on townhomes or beach houses!
I wouldn’t put a blanket statement that all condos are not warrantable. Some of the lenders we work with like Joe at Midwest Bank Centre have more flexible condo questionnaires that can qualify a condo as warrantable when other lenders can’t. As long as the loan is conforming, below $647,200, it will qualify for that 10% down second home loan. As for not cash flowing I think the market is at a point where buyers can negotiate on price. So writing an offer at a price point that gets you net positive cash flow is a possibility.
if you are putting 10% down for second home loan, wouldnt you be paying mortgage insurance?
@Trent Reeve Yep, you would be paying PMI, which would eat into your cash flow. @Ricardo Hidalgo I am also looking into this market, you mentioned beach houses on the west side, where is that?
The west side is where carillon beach starts into laguna beach right before pier park. I think building is a long term play but well worth it from a cashflow and appreciation perspective. There is tons of new builds coming to the area since 30A is becoming increasingly expensive and projects are moving towards that direction to reduce risk and high amounts of leverage.
- Real Estate Agent · Destin, FL · Member since 2019 · 116 posts · 111 votes4y
Looks like you've gotten some great info already! I definitely wouldn't rule out townhomes. Townhomes off of Front Beach Road tend to gross really well and have lower HOA , I would also consider that!
- Realtor · OK · Member since 2020 · 139 posts · 165 votes4yI love townhomes but I’m surprised how many people I talk to seem so averse to them.
Quote from @Jossalyn Wallace:
Looks like you've gotten some great info already! I definitely wouldn't rule out townhomes. Townhomes off of Front Beach Road tend to gross really well and have lower HOA , I would also consider that!
- Real Estate Agent · Emerald Coast, FL · Member since 2016 · 820 posts · 487 votes4y
Hi, @Adam Rose! I'm Avery Carl's STS agent on the Emerald Coast, and I have several properties to recommend.
Calypso is super-fab. Great location (closest condo to Pier Park), 2 buildings ON the sand, and one building across the street (completed in 2021, so brand new!).
I love Edgewater for its terrific resort pool and restaurant. It's an older complex (1980s) but has an enormous beachfront spot.There are quite a few condos that will fit your needs, and condos are a good move right now because insurance rates on PCB are soaring.
I'd love to answer more questions if you have them, and I'll be at the BP Conference in San Diego in October if you'd like to connect in person. - Real Estate Agent · Fort Walton Beach, FL · Member since 2018 · 219 posts · 275 votes4y
@Adam Rose you are getting some really great, if diverse and therefore somewhat confusing opinions, lol. Either way, it's good info and hopefully helpful. One of the best things about Bigger Pockets is that you will get these diverse opinions that will allow you to make an educated decision. See my two cents below:
1) Most of us commenting here on your post are real estate agents (myself included). What that means is that (probably) most of us are very familiar with the market, the various complexes and how they will perform potentially. That said, most of us can't quite disassociate with the idea that you might be a potential client for one of us. So, I would suggest, read everything with that in mind. I will try to pretend like I'm not an agent and will give you my most honest opinion as an investor.
2) Whether you consider condos or not will depend on not only your budget and financing options (most ARE non-warrantable) but also on how you plan to manage the property. Will you self-manage or will you use a full-service management company? Will you use mostly Airbnb or mostly VRBO or your own direct site? The reason these things matter is that some complexes like Edgewater, Shores of Panama, Tidewater and others will make it EXTREMELY difficult for someone who is self-managing. It's doable, but it's hard. Trust me, lol. There are a handful of management companies that have monopolized most of the large complexes and being the small newcomer is hard. Try getting parking for your cleaning people at Tidewater in the middle of the summer season, lol.
3) If you MUST do a condo (for example because you definitely want to have a direct beach view), then I would look on the WEST side, closer to 30A and away from Edgewater and Shores of Panama (legal issues here in addition to THIS WILL NOT CASH FLOW unless you are some sort of magician :-)). I like EMERALD ISLE (Different from Emerald Beach. Emerald Beach is the definition of condotel and cashflow there will be super hard. Nice place to stay on vacation, but not my pick for investment. I like Splash (if you must) and Aqua (more expensive). I don't like any condos down Thomas Dr. I really like ENDLESS SUMMER toward the west end. No beach views here, but if you want to use Airbnb rather than a mgmt company charging 25%+, this is a great option and it can cashflow. If you gotta go closer to the center and be in a beachfront condo, I like Ocean Reef. You will probably need to remodel some in order to get your rental $$ to where they need to be. But buying something completely remodeled there will be paying unnecessary premium. You could potential self-manage at Majestic Beach Tower, but it's an average pick of mine. As for Calypso.... if someone invites you to stay at their condo there, definitely go. You will enjoy it. Newer (if gaudy) nice complex with great amenities. If you are buying... this is super expensive per sq ft and will NOT cashflow. Also, keep in mind that Calypso III (the newest one) is NOT on the beach and even if some of the higher floors currently have some sort of sideways beach view, that will soon go away as active construction is going on directly in front on that view (which also overlooks the busy street, the mall side streets, and a bunch of parking).
4) I'm going to go with @Ricardo Hidalgo on several points here. Cashflow right now is tight, so condos are hard to squeeze for cash unless you get a super deal and then you self-manage the heck of it. If you are buying with a long-term view in mind and absolutely would like to be on the beach, than you may need to prepare for a few years of near break-even or even losses with beachfront condos (again depends on revenue and mgmt fees). If you can buy and remodel that would help you negotiate a better price of a "less updated/desirable unit" in your selected location, so potentially will get you increased value in the future. If you buy turnkey at today's prices that will be harder. I also REALLY LIKE townhouse in PCB. There are many, they finance better, they are easier to resell, they are available in different price ranges, etc. (Just prepare for higher insurance. Still less than the condo HOAs.). Look into Gulf Highlands Resort -- all townhouse and directly across from Majestic Beach Tower, Horizon South complex has some units that are actually townhouses. A number of townhouse options on the west end and in Sunnyside/Laguna/Riviera. If you MUST go to Thomas Dr, then look at the various townhouses there. Again, if you can do some updating rather than looking for "turn key", you will probably get a better deal.
5) Get a LOCAL lender!!!!
6) The good news is that as the market is right now, you will not need to make all cash offers with $$$ appraisal contingency waivers, etc like you would have in March of this year :-).
7) Rental projections: these are useful ... to a point. If you buy a unit with brown carpet and yellow walls and rental projections of $40K, chances are that might change if you update the unit and self-manage or use another mgmt company. If you are NOT looking to self-manage, then definitely approach your purchase from that perspective and make sure you buy something that will be in location where good management is available. I.e. don't buy a house 5 miles away from everything that no manager will want to deal with :-). If you plan on using a certain management company, then use their rental projections. In some complexes you almost have to use certain ones. Picking on Tidewater again, lol. Vacasa manages over 100 units there and has a front desk on the second floor. Imagine a confused guest family who finally make it out of the parking structure, get inside the lobby and are trying to get their magnetized wristbands (you can't open any doors without those at Tidewater). And lo and behold, their management company is not Vacasa or Panhandle Getaways or another big one and they are lost.... and the person at the Vacasa desk gives them "the look", lol. (Sorry, I've shown a bunch at Tidewater, so I have stories, lol.)
I really like PCB as an investment option. I almost bought there this spring (a unit in Endless Summer), but I ended up buying a townhouse on Okaloosa Island (FWB) instead.
Good luck!!!
- Member since 2021 · 18 posts · 5 votes4y
I won't comment on the opinions above. I'm sure everyone else has more experience than I do.
However, one thing I ran into this week looking in PCB, is an HOA that's voting whether or not to allow STRs. I've been told I've pretty rare to see, because vacation rentals have been there for decades. But it means for me at least, that property is off the table.
I would make dead sure you're buying a place with either no HOA (my pref), or one that's confirmed to be STR friendly.
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