I'm way too excited to buy in Orlando, what do I need to know?

Question

My husband and I are moving to central Florida this fall for work and have found ourselves in possession of a little nest egg from our previous equity.

I've always been interested in REI and I really don't want to squander this chance to kick start our portfolio. However, I know the competition is UNREAL in central Florida and there's a lot to be afraid of as a land lord down there.

Are Vacation Rentals the smartest way to go off the bat? What are long term rentals like down there? Are ocean side cities too risky? What advice would you give to a new resident with $100k to invest?

Tyler Gibson · Answer

@Natalie Wright I suggest you start with long term rentals. There has been an affordable housing shortage here in Orlando for several years. If you can I suggest you buy a Duplex. It give you the benefit of having multiple units that produce income. As rents rise you increase rent on both units. It also has the benefit of only being one property to maintain albeit that you will have 2 of everything fridge, stove, AC But only 1 roof 1 tax bill etc. I am a rental property investor and realtor here in the area and would be happy to help in any way I can. Feel free to reach out if you have any questions.

Susie Lowe · Answer

I would do a duplex! I have had several single family rentals and I love the multifamily strategy better now.  I bought a  multifamily property last year and it’s easier to work on it because all my units are on one property

Alice Horn · Answer

@Natalie Wright congrats on the move!  "Excited" is a good place to start. You received some great advice already above. Should you also decide to investigate STR's in a stable vacation rental community, happy to help you with some data so you can compare with long term. Again, welcome!

Brandon Vukelich · Answer

Go long-term rentals...2-4 units.  The closer to 4 the better.  The boring but conservative way to start out.  I own long term properties and one 3-unit Airbnb but won't do anymore. Some are killing it with Airbnbs but many cities cracking down in AZ, HI and growing, especially now with covid.

If you don't know anything about FL landlord-tenant laws, either start studying now if you plan to self-manage. Otherwise, I'm a huge fan of hiring a pro PM when starting in a new market.  So much liability these days.  Some landlords are too cheap to pay 6-10% then lose thousands with bad tenants, evictions, improper handling of deposits, discrimination lawsuits from improper screening questions...I could go on.  Best wishes on your journey!

Natalie Wright · Answer

I am very excited about the affordability! I need to learn the market before I get started though, 250k looks good to me but that doesn't mean it actually is a good deal...

Thank you for the break down! I'm still learning the tax rules, wil they let me just keep the rest in savings for repairs? I need to talk to an accountant before I sell in Utah, maybe...

Natalie Wright · Answer

@Dionte we definitely will have a separate living property but I've not decided if we should get two different properties all together or get a duplex and rent out half.

@John that's a great idea, thank you! No reason I can't try the complicated stuff later

@Julian hopefully not. Maybe at first until I know the property is generating enough cash flow to sustain itself.

@Tyler yes I was thinking of starting out in a duplex, we still haven't bought a living property for ourselves yet.

Should I get a duplex and live in half our buy a second home property and rent both halves of the duplex?

Susie Lowe · Answer

@Natalie Wright I’m in lehi, Utah and will be buying this fall in Orlando as well as we plan to move later this year as well.  I invest in Utah and Idaho so I’m excited to get into the Orlando market soon.  I am buying as a long term rental since we will be there a few years and then come back. I would consider buying your home you will live in with 3-5% and then use the rest of the money to buy another long term rental with 20% down and you can manage it there since you will be living in the area.  That’s how I would use your 100k if you had that.  Plus the Orlando market is cheaper than our market in the salt lake area so your money goes further.

Julian Sage · Answer

@Natalie Wright do you plan to self manage?

John Underwood · Answer

I have both type properties. I would advise someone just starting out to begin with ling term rentals.

If the parks have to shut down again then STR properties will be hurt.

Get a good tenant in a LTR and you will be less likely impacted. Id also look at the tenants that apply and look for a school teacher, fireman, etc that is less like to be affected by a layoff.

Dionte Robison · Answer

my mom owns a vacation rental in Davenport. For the first year since July 19, we were always rented out, then around March of This year when Covid-19 appeared. We ended up moving in. So will you have another place to stay besides the vacation rental or?

I'm way too excited to buy in Orlando, what do I need to know?

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