Hi, looking to purchase a single family home in the Clearwater Beach area. I will be renting this out and staying in it periodically in the winter, eventually retiring to it as a winter home.
I'm trying to understand what type of demand exists for rentals year round. I know spring break and summer is hot but unsure what demand is like other months of the year.
Where are you looking to purchase? Clearwater? I can recommend an unbelievable real estate agent in the area that has lived in this area for 30+ years that will be able to answer any and all of your questions about the off season. Let me know if you’re interested and I can get you in touch.
The peak season for Clearwater is around spring break time in March for short term (Air BnB). The wintertime is nice to get the snowbirds that like to rent for 1-3 months at a time year after year. If you are flexible and want to use it when it is vacant you should be able to and profit. If you would like more help please feel free to reach out.
I don't like too much when people tell you how they feel about certain things...so I will provide you some metrics which I think will be helpful.
I have multiple short-term rentals that are on the Gulf in this area. My average occupancy rate for them are all pretty similar (within a few percentage points year over year per month).
This is a 70% occupancy rate for the year.
Now keep in mind, I am one of the higher priced properties in my rental class. I do not discount just to have a higher occupancy rate. Could I lower my rate in the off months to make a few extra hundred bucks a month? Sure, but this is my experience. Take a low month like August for example. Let's say I was renting it at $100 a night. I make $1,200 for the month at full rack rate of 12 rented days. If I was to discount my rate for that month 30%, then I would have to rent 18 days in the month to make the same amount. 50% more wear and tear on my property to make the same amount. So you can kind of see there then becomes a lot more work to make a little more money with a lot more wear and tear. In the condo unit for one of my properties, I am the #1 rented unit month after month. It is due to the finishes and amenities even though I charge the highest price in the complex. On another which is a single family house that I purchased Jan 1 this year, the last owner had a 36% occupancy rate for the year. For 2018, I already have 44% booked for the year with a target of 65% occupancy for my first year at this location.
Bob Bello good real stats! I’ve also been looking for seasonal affordable investment that I can use on occasion in solid financial complex. Not easy to find. Do you have a condo complex you recommend?
Bob Bello those are really helpful stats to look at. Do you ever do longer term rentals or are these strictly vacation rentals? I have had the idea of investing in rentals and I am trying to familiarize myself with the area in the best places to do so. Obviously the waterfront properties have more of a demand but is there any municipality that you find is more desirable? Any info helps! :)
Bob Bello thanks!
I've been in the Clearwater area for the past 4 years. Mostly working in the Plumbing service industry. If short term rentals (vacation) you'll want to be close to the beach. Any single family homes will be in a flood zone (expensive insurance), unless it's raised or you carry no mortgage and forgoe the insurance! Most vacation rentals are in condos, which are primarily above flood zone, except you now have HOA fees, which vary widely from complex to the next. Also keep ni mind Floridarequires you to charge a hotel tax on any rental leased less than 7 months. Most municipalities actually check vacation rental by owner and other rental sites, for addresses that are doing short term rentals. Make sure your realtor is well versed in the ins and outs of flood zones, HOA's and short term rentals. Local Property Management companies can make the rentals easier, if you are out of state. Hope this helps.
Be mindful of the regulations, both HOA and city. Many potential pitfalls. We own and manage several vacation rentals in the area.
I’m aware of a few that are about to hit the market too if you need the info, feel free to reach out.
I have my fair share of annual rentals too so I am well versed there also. There are so many variables. If you are at the point where you are looking to buy, PM me and I can discuss it further with you.
Not making it too complex or over simplifying things, there is much more that goes into it such as your budget, rate of return you are looking for, your ability to manage the rental and such. So I find that it is negligent to just say here or there is best. I would need much more info. As I mentioned above, if you are close to the time to really jump in...PM me and we can discuss in more detail.