Championsgate vs Reunion for short term rental investment

[Aaron May]

Hello. My wife and I own a handful of vacation rental property units in Michigan, our home base. We also own one on the Atlantic in Daytona Beach Shores, Florida which has performed very well. We self manage all of our own units and it's worked out well for us. We are now interested in acquiring a STR in the Disney Corridor of Southwest Orlando . We have taken two scouting trips and have connected with a great Realtor who has been very helpful. At this stage we have it narrowed down to Reunion and Championsgate. Our personal tastes lean more towards Reunion, but everything you read or hear about Championsgate suggests that calendars fill fast, high occupancy can be expected, and values stretch further in that development. We would love insights from anyone who has invested in these areas before.

Additionally, we haven't toured any homes in Encore at Reunion and don't know as much about it. We heard early on that Encore's values weren't holding and that there were issues there. We also heard that Encore requires that you hire one of their pre-approved management companies which would not work for us. However, we do see listings with great value PSF and the amenities appear to be robust.

Our budget for this property is $400,000 - $500,000 and we're letting ROI steer us to the right opportunity. We want to love the place, but it needs to be a cash flow generator first and foremost.

Thank you in advance for your insights.

[Keith Courtney]

Aaron -

It appears you are well on your way in your analysis of where the opportunities are in your search of our short term rental market here near Disney World.  A few things I can add to what you have already discovered -

Encore At Reunion - It's in a great location, and, when you buy in there, you have access to the amenities in Reunion itself.  The problem is, as you have already discovered, you have to use one of their designated property managers.  You can't make money paying their high commissions on your home's rentals.  The same developers are the owners of Margaritaville, and they have the same property management requirements there.

Reunion - Great location, beautiful homes, 3 championship golf courses, multi-million dollar water park and award winning tennis center - Appears great, but it's hard to make a profit.  The expenses are higher and there are limitations on how much your guests can use the amenities.  The only homes that I see making a good profit are the multi-million dollar homes.

ChampionsGate - Of the three vacation home communities, I think this is your best chance of making a profit.  I encourage you to go on Airbnb and HomeAway/VRBO and look at the homes that are renting the best at the highest rates and emulate them.  Regardless of which home you buy, you will need to spend some money in upgrades and fun features to maximize rentals.

One last note:  I would not put too much of emphasis on a PSF analysis.  While that works with long term rentals, it does not work well with short term rentals here.  I often see short term rentals with a higher PSF (sometimes much higher) perform better than those with a much lower PSF.  

Hope this helps.

Keith