Townhomes in Kissimmee near Disney - thoughts?

[Alex Show]

Hi curious to hear folks' experiences who own and rent their properties out for short term rentals, especially townhomes in the Kissimmee area near Disney. Would love to learn more about the market here, and if anyone can share numbers on historical rev, expenses etc would be helpful. Also, aside from covid the last few years, how has this area appreciated historically? Any info is great.

Thanks,

Alex

[Michael Baum]

@Shawn McCormick! Calling Shawn!

He knows a ton about the area. One thing I would look at is what other places like what you are interested in are doing for nightly rate, occupancy and amenities.

From what I have seen, smaller townhomes are the bottom of the barrel nightly rate wise. Under $100 night usually.

[Ryan Moyer]

Disney rentals are about two things.

1) Theming

2) Proximity to Disney

You'd better have one of those two things, or you're going to struggle and have to jump into the great lowball pricing wars of 2022-2023.  With proper theming, or a great location you can still do well.  It's hard to stand out location wise since STRs are limited to certain areas, but my main point is I wouldn't buy in one of the further out communities without theming.

Obviously it's all speculative, but my guess is appreciation is pretty maxed out in the near future.  We saw a huge increase with the post-covid travel rush and honestly probably still have further to fall before everything balances back out, and they build more of these places as fast as they can throw some sticks together.

[Shawn McCormick]

Hi @Alex Show (Thank you @Michael Baum)

Lots of questions here, are you looking at townhomes due to entry price, location, specific community, apparent ease of owning, no exterior maintenance etc?

As far as historical data and revenue, you can get generalized data from any number of sites. I would recommend that you speak directly with a PM locally that has live data that is gathered from other participating PM's, not just an algorithm that may not be current or pulling info from multiple communities. It is important to note that the units here, of all sizes and types (sfr, towns, condos) are in the 10's of thousands and each one is basically a small business. So the historical revenue on one could be drastically different from an identical unit on the same street, depending on how the owner manages the property. I see this alot, someone buys a unit based on it being booked alot and good reviews, but the new owner isn't as savvy in STR, hospitality or tech/marketing and they don't do well and have to sell.

As far as appreciation, during covid, prices jumped 50% or more in many cases. We haven't been out of covid long enough to see true effects yet, but I'm seeing it fairly flat. It peaked, but hasn't fallen off much. I contribute this mainly to that everyone that owns a unit here is an 'investor' of some level, and as long as they are cash-flowing, why sell. If the unit they bought has appreciated very well, they may sell, but if you bought at the height and are waiting for further appreciation, I wouldn't look here. With the shear number of units we have here and more on the way still make the area desirable but will become more difficult to a new or inexperienced investor in the STR arena.

Hope this helps, surely this will spark more questions, so feel free to reach out if you like.

Best of luck to you!

[Andrew Steffens]

Something to consider (with bias as we are in Tampa) is:

According to Zillow Tampa will be the only market in the US to appreciate this year.  I am already seeing multiple offers coming around again.

Many people who stay in Tampa split their time between Disney and the beaches (it takes about 45-1h to get from Tampa to the beaches, and about the same to get to Disney depending on exact location and traffic).

Even though prices have risen a lot over 2 years so have ADR so there is still opportunity to cashflow in Tampa and appreciate.

I hope that helps, I throw in this 2 cents because I have seen some people get frustrated in the Orlando market and I think Tampa is a close and viable alternative.

[Brooklyn McCarty]

Done correctly & in the right resort these can be great investments! Avery Carl’s team operates here 

[Sara Levy-Lambert]

Here's some info on the Airbnb market in Kissimmee from a result I found online

ROI +7%
Revenue $32k
Avg Airbnb price $482k
Market size Large
Number of Airbnbs 17,557
ADR $170
Occupancy 77%

[Kyle Mccaw]

@Alex Show  Your success or failure will be based off your management, which resort and your theming. All 3 need to be on point. I bought in Windsor Hills Resort Dec 2021 after staying there twice. It is in an amazing location. Originally I planned to purchase a townhome but realized that it would be difficult to get the revenue to a point that made it worth owning. With the single family home we were able to stand out with theme rooms, and an amazing game room. The townhome just doesn't allow this. Take anything @Shawn McCormick says to heart. After reading his many posts I have found him to be very accurate. 

[Alice Horn]

There are definitely townhomes near Disney (and in other areas) that can perform very well. As others have stated, it's all about the decor. A townhouse can be a spectacular smaller gem that attracts higher rates - theming doesn't have to be limited to the larger S/F home sizes.

Aside from theming and decor, pay close attention to the pool area. Is it a corner unit that has a more expansive feel, perhaps even a conservation or lake view? A southern or western exposure? All of these factors can increase your rates if they are highlighted in the listing.

Drop us a line and we'll be happy to brainstorm some communities that may be a good fit!

[Zach Edelman]

Very competitive market, but also tons of demand. Feel as though you need to be an elite player to really make your investment a homer here, and that means making your listing stick out/pop and having tremendous management. 

[Andrew Betts]

Have great photography and stay up to date with your content to match the latest ranking algorithms. Orlando is ultimately a service and hospitality sector, so I would say to stand out be a great host, highly responsive and above all else, keep it clean. 

Your target audience are multi-generational families. The more bedrooms, the more profit. If you get a townhouse, make sure it has more bedrooms than the neighboring townhouses (if thats possible).

[Gabriel Pena]

There’s great opportunities in this area especially in the 400k+ with new communities near all the major attractions!