Beachfront Condo vs Beach house a block away

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Beachfront Condo vs Beach house a block away

David New
Rental Property Investor · Atlanta, GA · Member since 2019 · 78 posts · 33 votes

How would a beachfront condo compare to a beach house that was a block or two away from the beach do in terms of rental revenue? This would be assuming similar specs (3b/3b) and purchase price.

Would appreciation be pretty close as well?

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Ryan MoyerBusiness Member
Property Manager · Orlando Kissimmee Davenport Salt Lake City, Park City · Member since 2019 · 991 posts · 1k+ votes
5y

Put a pool in the house a block away and it will blow the condo away. 

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  • Villy Ellinger
    Real Estate Agent · Fort Walton Beach, FL · Member since 2018 · 219 posts · 275 votes
    5y

    I tend to agree with most of the other replies here. Beach-front is not necessarily a better deal always. While beachfront may be more obviously in demand, most properties that are directly on the beach are condos with really high HOA fees and other expenses. Also, if they are in large complexes, there are limitations and restrictions on what management companies you can use, on financing options (non-warrantable properties may require higher down payment and portfolio loans), etc. So in the end, even if the price per night stay is higher in a beachfront condo, the overall ROI in a beach house a block away might be higher for the property owner. An actual, non-condo beach house, locating ACTUALLY on the beach in Emerald Coast area would be price over $1M. On 30A, make that $4M+. A few blocks inland the same type of house would be $700K to $900K. At the same time the gross annual rent would only be different by may be $10K to $20K max. You do the math on return %, lol.

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  • Steven McnuttPro Member
    Pompano Beach, FL · Member since 2016 · 12 posts · 16 votes
    5y

    Can't speak as a subject matter expert in terms of revenue, but I can certainly speak to appreciation as a beachfront condo owner, and knowing a thing or two about coastal real estate.

    Beachfront condos have poor appreciation.  As they age the maintenance costs escalate and the long-term residents esp retirees will push back on assessments, exacerbating the problem.  Also, condos tend to appraise conservatively so to get top dollar you need a cash-heavy buyer to cover the gap. I would not recommend a beach condo if asset value appreciation is a priority.

    For appreciation in a coastal area, Concrete block SFH is the gold standard (ideally with no HOA if you plan to rent).

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  • Connor Cushman
    Realtor · Cumming, GA · Member since 2018 · 158 posts · 127 votes
    5y

    My observation would be that your return will be better a block or two off the beach.

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