Real Estate Investor · Yorba Linda, CA · Member since 2010 · 3 posts · 0 votes
Hi
I am looking to invest in South Florida, I live in California have a couple of rental properties here, I sold one and want to redeploy cash and was wondering if South Florida is a good market for investment. I do know out of state investing is kind of tricky, also if there is any realtor that can help me get deals in South Florida would be helpful.
Wow, you live in Yorba Linda and you want to invest 3,200 miles away? Why not drive 5 miles west and invest in central OC? What about L.A? How about Long Beach?
What part of FL are you looking at when you say south FL? Also what are you looking for cash flow or appreciation?
I invest in Central Fl and never really made my way down south that much so I'm less familiar with the market there but I'll help however I can. As a general guide I would say that as you move South in FL prices go up and cash flow goes down, but like SOCAL that guide doesn't fit every area and you can find cash flow down there.
I choose central Fl for a couple reason. First my family lives there and I was born and raised there so I feel more comfortable and understand the market there. Prices are fairly affordable and will provide cashflow, and I believe that appreciation will also be better than average, though I don't plan on that when I buy.
The central FL market has pretty good economics to be sustainable. Obviously Disney is in town and employs a lot of people, and draws a lot of out of state and out of country visitors. Even during the down time people will still travel to Disney and spend money. The University of Central FL is one of the biggest schools in the country and has a good engineering program and a new medical school that opened recently. There are several engineering companies that have large facilities in Orlando like Siemens, Lockheed Martin, Disney Imagineering and a lot more.
One great thing about FL as a whole is last year or 2 years ago when they had a deficit in the budget the Governor cut budgets significantly a few times but they have still been able to sustain capital improvements to roads and schools during that time, and not run an ever increasing deficit. This year they had a surplus, so it's nice that the local politicians have been able to figure out budgets without having to increase taxes at all.
The 2 expenses that I've found tend to be higher as a % of property value are insurance and property taxes. Insurance isn't too bad but you just have to remember that they do have hurricanes and sinkholes so the insurance companies have to account for that. Taxes also aren't too bad, as a dollar amount they are way lower than here in CA, but as a % they are higher. So for those just make sure you have a good understanding of those costs and you should be ok.
Thank you all for your replies, Matt your insight is truly helpful, thanks Mehran for referring this question to Matt.
I have only research knowlege about Florida, I have been investing in CA especially orange county but this is a market where one can look for appreciation , I exited one position here and now I am focusing on generating cash flow so that is one primary reason to look towards Florida.
It will definitely be my first time even exploring investment out of state, I like you Matt don't have family there. I would be more interested in multi units that have a stable cash flow and in a rentable area, I have heard not every place is equally interesting or rentable. Can you suggest the price points I am looking at in areas where there is stable employment and what would be those areas.
I am also looking for a reliable property management company and a Realtor to help scout investments in Florida, Matt if you have any suggestions and recommendations it will really be helpful. Based on your recommendation I am open to Central FL, and you have justified the economics as that was one aspect I had no clarity how the economy survies inorder for the rental market to provide a stable cash flow.
I also as part of research read that there is a 6% tax on rental income I am not sure if I read this correct, so other than higher insurance and property taxes are there any other expenses that I have to factor in specific to that state ?