Specialist · Tampa, FL · Member since 2018 · 96 posts · 40 votes
Hello Real Estate World!
I am looking to find out what Florida investors fear when purchasing properties in Florida. I know many of my investors have fears of termites, foundation issues, sinkholes, flood zones ect. Also I would like to find out what are some solutions to these problems/fears. Trying to get more feedback.
One thing that comes up with my investors is what type of hurricane protection is in place. Is it hurricane glass? Something that has to be manually applied? Or accordion style blinds that are easy to position in place.
Great question on how to make investors more comfortable in their investments. I think you can only offer so much reassurance. At the end of the day, weather and bugs happen! But certainly, the best insurance a person can afford will help.
Great question Mike! From my experience some investors fear "the rumor" that Miami will go under water, others fear that zoning laws will change down the road and the laws will be different, some are afraid the current "airbnb qualified " properties might not allow short term rentals in future. Foreign investors fear that visa laws will change, and they will not be allowed to come easily to USA, or bring their family members in future. The rest already mentioned with hurricanes, flood and insurance cost issues. However, despite all fears south florida (miami) remains active place for "bargains" ( price per SQF) with attractive mortgage rates, spectacular location, cultural growth, strong rental market and a good way to diversify portfolio.
High insurance premiums, weather, termites, sinkholes...
This is from a buy-and-hold landlord’s perspective:
IMO no market is perfect. In my first target market, my home state of SC, high NOO property taxes kill an unfortunate amount of deals.
I own my primary residence in CA and got lucky purchasing it in 2009 when there were foreclosures everywhere. Buying something here now I wouldn’t come remotely close to the 1% rule. I’m also marginally terrified of how tenant-friendly this state is.
I’m now investing in NC and I’m having difficulty finding deals that are worthwhile in my target neighborhoods, though I understand things are really tightening up in most areas of the country.
What a great question. I recently had this discussion with another parent at my kid's school who also makes real estate investments. Our families have been on vacation together in Florida and Hawaii. My sister now lives in Florida (East Coast of FL) and I myself lived in St. Pete over 20 years ago.
We both (the other parent and I) independently decided AGAINST investing in Florida, even though we were both looking to diversify our real estate holdings (and had put Florida on the short list, at first). The long term prospects just don't "feel" that great. Besides the bugs and the gators and the subpar education system (sorry, but it's true), it really comes down to we "don't know what we're really buying in terms of exposure to future flooding events". It doesn't help that the National Floodplain maps are outdated and universally acknowledged to be "politically influenced" (as certain neighborhoods in Houston demonstrated).
Maybe it's a bit short-sighted but with plenty of solid places to invest (major cities with booming job markets), it makes pulling the trigger on Florida an unenthusiastic choice.
For me it is Flood insurance. I"n a flood zone can push your numbers to apoint of bare profitability. doesn't affect flips but rentals it is a big deal. I will not invest in flood zones, unless it is a smoking deal. I look for flood zone X on the county FEMA flood map and still by flood insurance. $400 to $500 is worth it. $ 2500 is not.