Kissimmee / Davenport 5+ bed STR post Covid
Rental Property Investor · Canada · Member since 2020 · 10 posts · 4 votes
Kissimmee / Davenport 5+ bed STR post Covid
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Property Manager · Kissimmee, FL · Member since 2019 · 445 posts · 266 votes
6yHi @Sebastian P.!
Demand for properties near Disney is actually quite high at the moment. We manage 79 properties in that market, and ended the summer at 66% occupancy overall for all of our homes. Many of our top properties were well above that, in the 80's. Overall,it's slightly below last year, but still very positive, and we are seeing occupancies and rates bounce back.
Here are some things to consider.
Travel patterns are changing post-Covid. This means there has been a strong uptick in the demand for vacation rentals as opposed to hotels. Families are looking for the privacy, control over their environment, and social distancing they can find in an STR.
With work and school schedules changing due to remote work and learning, families may start traveling in the previously "slower" months. They are eager for a change of pace, and spending time in a pool home in a resort with all the amenities is very appealing.
Not everyone is ready to go back to the theme parks yet, but we anticipate significant pent up demand when things return to normal.
- What else should I be wary of? - Look for homes in communities with strong HOAs. Yes, the fees may be a bit higher, but the demand and rates will be higher in these communities. Plus, you will have an added layer of security.
- What other questions should I be asking? - Ask for transparency. Booking history on the home/community you're interested in, and even an example of a statement.
- Should I wait longer to see if prices drop further? Jury's out on that one. Some people do believe that overall, prices may drop once mortgage protection ends in October. I would say that if the numbers check out on a property and your projections are sound, the timing is up to you.
Good luck, and let us know if we can help provide any analytics or projections for a specific home and community.
50 Replies
- Investor · San Diego, CA · Member since 2019 · 326 posts · 266 votes6y
I have worked in both markets but not short-term rental. They are good short-term rental markets because of the location. I am seeing difficulty to pay rents, and sellers are starting to budge. Things have started to open, and people are coming back in the picture so I am sure things will pick up again. Pre-covid there were no issues, but post covid I think the closer you are to attractions the better.
I'd wait for a few more answers, some might be having better luck. Of my 3, only having trouble with 1 not making payments.
- 6yJonathan ConaghanPro MemberRental Property Investor · Queens, NY · Member since 2019 · 50 posts · 33 votes
@Sebastian P. We own a property in Kissimmee close to Disney that I utilize as an STR. I purchased it last June, renovated it substantially and got it listed. It took a while to pick up steam, but eventually did, I believe due to the quality of the renovation/decor. The last few months have been rough as they have been for most people and attempting to predict what the future holds is probably not helpful as I do not think anyone knows. Assuming we get back to "normal", proximity to the parks, more bedrooms and updated decor will help an STR stand out in a crowded market. Happy to answer any additional questions. Feel free to shoot me a message.
- Rental Property Investor · Canada · Member since 2020 · 10 posts · 4 votes6y
Thank you sir!
- 6yChuck MastersPro MemberInvestor · Bel Air, MD · Member since 2015 · 95 posts · 57 votes
I've have a STR near the 192/Rt 27 area 10
Min to Disney and up until March everything was GREAT. Since March I’ve had 2 guests totaling 11 days. I do still get VRBO inquiries that are potential parties after vetting so we don’t accept. My neighbor who was no minimum stay requirements, we have 3 day minimum, has party guests all the time. Too much damage from party guests and complaints from the neighbors.
Just my opinion but If it were looking for STR right now in that area I would wait too see how many owners give up because they can't afford to carry the mortgage and sell and if the market has a lot of these, lower prices, and that may start happening in the spring time.
- Rental Property Investor · St Augustine, FL · Member since 2020 · 36 posts · 32 votes6y
I am looking into that exact location and had the exact questions.
Curious to see what other responses you get. I think I'm going to wait and maybe do a long term rental until things pick up in that market.
- 6yKyle MccawBusiness MemberProperty Manager · Keller, TX · Member since 2011 · 1k+ posts · 1k+ votes
Following. I'm also interested in purchasing a STR new Disney World. Mostly in 1st quarter 2021.
McCaw Property Management4.4905 Reviews - Investor · Chicago, IL · Member since 2020 · 148 posts · 97 votes6y
@Sebastian P. Since there are many international travelers that come to Kissimmee, the vacation rental market has been a rollercoaster with the travel restrictions and Disney not being fully reopened. I think the demand for real estate is still high as many people working remotely have decided to invest in a second home. I also predict that the rental and real estate market will bounce back as soon as the parks are fully open and travel resumes.
The Kissimmee area is a destination that brings in multigenerational travelers, so anything above 5 bedrooms is desirable within a few miles of Disney and is considered prime real estate for vacation rentals. Most guests want a pool and updated amenities where they rent. South facing lots seem to rent at a higher rate. I have a great agent referral is interested!
- Investor · Orlando, FL · Member since 2012 · 312 posts · 165 votes6y
I got 5 Single family rentals minutes from Disney.. We are taking a beating as well as Disney is also. Saw a disney resort stay for $125 for a entire week. I don't see a recovery until maybe a year from now.
- Real Estate Agent · Orlando, FL · Member since 2019 · 59 posts · 90 votes6y
Hi - I own 2 STR in Kissimmee near Disney parks. I'm currently buying another one and helping other investors buy in the same area. I haven't had vacancy issues personally as I've been a super host for the past 2 years with great reviews. In terms of the occupancy, September and October are the lowest season in this area historically. It starts picking up mid-November and peaks in December and January.
As you mentioned the low inventory coupled with the strong demand has driven up prices in the past months but there are more listings coming out starting in August. Once in a while a good one comes to the market. In terms of deals we're considering in this market are:
(1) we try to look at those priced at the median price (around $250K in Kissimmee) or if the listing price per sqft is comparable to sold properties in the community (this could vary depending on the area but we're looking at around $150 per sqft).
(2) check on the age of roof and AC systems before going to see the house. I also check on Google Earth to see the condition of the roof as many houses in the area were built in 1980-1990s nearing end of useful life.
It's hard to tell exactly how the situation will be in the coming months. But I believe people will favor staying in a single family home with private pool over hotels/resorts even after the pandemic. My background is in accounting and I'm always thinking of the worst case scenario. My worst case scenario planning is (1) whether I will generate a positive cash flow if my STR is converted to long-term rental due to travel restrictions and (2) do I have enough cash reserves to cover fix costs if my properties are vacant and if so for how long can I cover. If I'm prepared for these scenarios I believe I can navigate through the storm. Happy to help if you have additional questions.
- Property Manager · Kissimmee, FL · Member since 2019 · 445 posts · 266 votes6y
Hi @Sebastian P.!
Demand for properties near Disney is actually quite high at the moment. We manage 79 properties in that market, and ended the summer at 66% occupancy overall for all of our homes. Many of our top properties were well above that, in the 80's. Overall,it's slightly below last year, but still very positive, and we are seeing occupancies and rates bounce back.
Here are some things to consider.Travel patterns are changing post-Covid. This means there has been a strong uptick in the demand for vacation rentals as opposed to hotels. Families are looking for the privacy, control over their environment, and social distancing they can find in an STR.
With work and school schedules changing due to remote work and learning, families may start traveling in the previously "slower" months. They are eager for a change of pace, and spending time in a pool home in a resort with all the amenities is very appealing.
Not everyone is ready to go back to the theme parks yet, but we anticipate significant pent up demand when things return to normal.
- What else should I be wary of? - Look for homes in communities with strong HOAs. Yes, the fees may be a bit higher, but the demand and rates will be higher in these communities. Plus, you will have an added layer of security.
- What other questions should I be asking? - Ask for transparency. Booking history on the home/community you're interested in, and even an example of a statement.
- Should I wait longer to see if prices drop further? Jury's out on that one. Some people do believe that overall, prices may drop once mortgage protection ends in October. I would say that if the numbers check out on a property and your projections are sound, the timing is up to you.
Good luck, and let us know if we can help provide any analytics or projections for a specific home and community.
- Member since 2020 · 61 posts · 39 votes6y
Stay away from Encore at Reunion. They force you to sign up with their management companies. Homes that sold for 800k are now selling for 450k. Many of the other places: Windsor at Westside, Windsor Hills, etc. look to have some discounted properties but not free falling prices.
- Novi, MI · Member since 2015 · 8 posts · 2 votes6y
I bought a place in ChampionsGate in July. I’ve been happy about the purchase!
- New York, NY · Member since 2020 · 105 posts · 49 votes5y
@Jonathan Conaghan can you tell me more about your rehab please? I keep debating in my head if I go turnkey or find a rehab so i can try to get the downpayment out via a higher ARV. Is that possible in the vacation rental communities?
@Serena Kim where do you find $250k properties for STR. I am lead to believe that at that price occupancy can be a problem and that i should focus on the 7-9 bedroom homes in the amenity heavy hoa which usually then are $475k-$550k. thanks
- Real Estate Agent · Orlando, FL · Member since 2019 · 59 posts · 90 votes5y
@Louis Zameryka
The houses that I own for STR are all in the 220-245k range, 3-4br in no or low HOA communities. But, I also manage them myself.
Regarding a 250k no-HOA house vs a large 5 to 9 bedroom resort house/community, it just depends on your market view. There are 2 schools of thoughts when it comes to STR in FL:
1. Low or no HOA houses - these are usually 3-4br houses in communities with few to no amenities. They are cheap to maintain, fixed costs are low and hence give you a lot of flexibility when it comes to pricing. The disadvantages are that since they are smaller and "cheaper", you have more competition (including hotels at that point), hard to find a property manager that will manage them (they are higher maintenance, you have to take out trash and recycles, etc), and there is a limit to how much you can charge since there is so much competition. With that being said, since most people now prefer Airbnb houses to hotel, they tend to do well as long as your place is well remodeled, unique, and well managed.
2. Large houses in rental communities - these are usually the 5+ bedrooms. I see them as a levered play on the STR market. They usually start in the mid 300s and can go as high as 500k as you well noticed. The monthly HOA fees can be substantial, but you can charge more. On the other hand, your competition is just those other resort houses. Big families and groups will usually prefer these, and can seem more attractive to the "resort" style traveler.
They both have pros and cons, that's why it will depend on your view. Want a starter house that you can manage yourself? Go with a no-HOA one. Want to go "big" on the STR market theme and have a professional property manager? Go with the resort-style house.
Serena
- New York, NY · Member since 2020 · 105 posts · 49 votes5y
@Serena Kim thanks Serena. I think really my concern is the the magic in real estate investing is leverage and with the Orlando area turnkey str’s I don’t see how I’d get my down payment out to move onto the next property. It’s got me wondering if it’s the right move.
I’d equally be happy with an Orlando multi family I think. Provided one unit is open for me and my family to live in Jan-May 2021
- Property Manager · Kissimmee, FL · Member since 2019 · 445 posts · 266 votes5y
@Louis Zameryka, I have a few more insights to add to Serena’s great post. We manage over 80 properties in the Disney market, focusing on the gated and amenitized communities which are appealing to most travelers. The communities closer in to Disney - Windsor Hills, Windsor Palms, Emerald Islands, Paradise Palms also have older homes which can be bought at cheaper prices and fixed up so they compete with the turnkey homes you refer to in the newer communities.
I don’t recommend a home smaller than 4 bedrooms as you would limit your market to small families, however you can definitely find opportunities at $250k and up.
Consider a dated 4-5 bedroom townhouse with a pool (a pool is a must), modernize the decor and you will have an attractive property, close to Disney that can book well and accommodate 8-12 people. Or if your budget is higher, invest in a larger s/f pool home following the same formula. Good luck!
- Real Estate Agent · Orlando, FL · Member since 2019 · 59 posts · 90 votes5y
@Louis Zameryka
STRs are for cash flow primarily. As Alice mentioned, if you buy an older one and remodel it then you can build some equity.
Unfortunately in Orlando the multi-family market is very limited, and extremely expensive. You’ll have to look 1hr away from Orlando to find any at a decent price.
- Investor · Andover, MA · Member since 2015 · 269 posts · 67 votes5y
Would love to resuscitate this thread to see how folks are doing with STR's in and around Disney area. I have followed the market and saw it's heated at this moment when we look at recent sales at Windsor Hills, Paradise Palms, Champions Gate, Solara, etc.
How are you doing fellow investors?
- 5yJonathan ConaghanPro MemberRental Property Investor · Queens, NY · Member since 2019 · 50 posts · 33 votes
@Flavio Zanetti bookings have picked up dramatically. We have all of April and most of May booked up without having to discount rates as we had been doing to stay occupied the last few months. Assuming no further Covid curveballs, investors that picked up properties on the cheap in the last month or two should be feeling pretty good.
- Investor · Andover, MA · Member since 2015 · 269 posts · 67 votes5y
Originally posted by @Jonathan Conaghan:
@Flavio Zanetti bookings have picked up dramatically. We have all of April and most of May booked up without having to discount rates as we had been doing to stay occupied the last few months. Assuming no further Covid curveballs, investors that picked up properties on the cheap in the last month or two should be feeling pretty good.
Sharing here for what's worth: I have a couple of rich friends that have several properties in Davenport, Reunion and Four Corners areas. They are in the process of acquiring more and both of them said had issues appraising properties at Windsor Hills and Paradise Palms due to their higher prices recently. So wondering if / when the market will adjust I guess
Great news on occupancy nevertheless!
Flavio
- Property Manager · Kissimmee, FL · Member since 2019 · 445 posts · 266 votes5y
@Flavio Zanetti we are currently seeing an unprecedented number of bookings and rates have returned to pre-pandemic levels. It will be interesting to see where this peaks out. Given the fact that Disney and the other parks are still operating at reduced capacity and international travel has not yet fully reopened, we are expecting strong demand for the foreseeable future.
- Investor · Andover, MA · Member since 2015 · 269 posts · 67 votes5y
Originally posted by @Alice Horn:
@Flavio Zanetti we are currently seeing an unprecedented number of bookings and rates have returned to pre-pandemic levels. It will be interesting to see where this peaks out. Given the fact that Disney and the other parks are still operating at reduced capacity and international travel has not yet fully reopened, we are expecting strong demand for the foreseeable future.
Very interesting Alice. Thanks for sharing. Interesting times we are living these days.
Search continues...
- Member since 2021 · 6 posts · 0 votes5y
Hello everyone,
I'm on a process of buying a house at Solterra resort and its on a 350. This will be a complete STR. I'm still wondering if this is a good investment. Any thought from everyone. Anyone familiar with Solterra Resort and can give me some background.
Thank you
- Member since 2021 · 6 posts · 0 votes5y
Hello everyone,
I'm on a process of buying a house at Solterra resort and its on a 350. This will be a complete STR. I'm still wondering if this is a good investment. Any thought from everyone. Anyone familiar with Solterra Resort and can give me some background.
Thank you
- Investor · Orlando, FL · Member since 2012 · 312 posts · 165 votes5y
@Wyclif Kpanou give us some numbers to work with
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