Hi, 

I am looking for advice on Emerald Island resort, STR property in Kissimmee, Fl. If anyone has experience with owning in that area or in that complex, I would love to hear your experience.

The place I am looking at is a 7 bedroom house for $250k. Do you think it's a cash flow positive market? First time investor so any inputs would be highly appreciated. Is it a good STR community to opt for? Any red flags I should see? Interested to know your experience and if its worth it.

Originally posted by @Laura Jensen :

Hi, 

I am looking for advice on Emerald Island resort, STR property in Kissimmee, Fl. If anyone has experience with owning in that area or in that complex, I would love to hear your experience.

The place I am looking at is a 7 bedroom house for $250k. Do you think it's a cash flow positive market? First time investor so any inputs would be highly appreciated. Is it a good STR community to opt for? Any red flags I should see? Interested to know your experience and if its worth it.

 Laura,

That development is not bad if you can get the house at the right price. If you have a house that big available for only $250k I would say its definitely worth it. Houses that large in that area have been creeping up steadily. They are usually in the $330k-$400k range depending on the model. There are 2 models in particular that are huge.

The place has 2 main problems:

1. Parking.

2. High HOA fee. The HOA fee takes away immediately from your cash flow.

Hope this helps,

-Matt

Hi Matt,

Thanks, I had a typo the property is around $350k, so still in the lower end of the range that you mentioned. I did try to run the financials and yes the HOA is creeping in but my seller says he has a good rental history which covers it all. The house is updated so that is good but I have been hearing mixed opinions from some property managers that I have talked to. Some say its great and some say to stay away. I am not sure if there're any red flags about that subdivision that make it less desirable as a STR option.

Thanks
Laura

Originally posted by @Matt Nico :

Originally posted by @Laura Jensen:

Hi, 

I am looking for advice on Emerald Island resort, STR property in Kissimmee, Fl. If anyone has experience with owning in that area or in that complex, I would love to hear your experience.

The place I am looking at is a 7 bedroom house for $250k. Do you think it's a cash flow positive market? First time investor so any inputs would be highly appreciated. Is it a good STR community to opt for? Any red flags I should see? Interested to know your experience and if its worth it.

 Laura,

That development is not bad if you can get the house at the right price. If you have a house that big available for only $250k I would say its definitely worth it. Houses that large in that area have been creeping up steadily. They are usually in the $330k-$400k range depending on the model. There are 2 models in particular that are huge.

The place has 2 main problems:

1. Parking.

2. High HOA fee. The HOA fee takes away immediately from your cash flow.

Hope this helps,

-Matt

Originally posted by @Laura Jensen :

Hi Matt,

Thanks, I had a typo the property is around $350k, so still in the lower end of the range that you mentioned. I did try to run the financials and yes the HOA is creeping in but my seller says he has a good rental history which covers it all. The house is updated so that is good but I have been hearing mixed opinions from some property managers that I have talked to. Some say its great and some say to stay away. I am not sure if there're any red flags about that subdivision that make it less desirable as a STR option.

Thanks
Laura

 

Laura,

That's a pretty important typo...hahaha. 

Yeah at 350k I would stay away from that deal. Its not that the house wont cash flow and do okay. The problem you have is that you can buy a house for $275k-300k in a different neighborhood around Disney that nets you more cash flow, costs way less, and the HOA and parking situations are much better.

As an example, I have a 7-bedroom house worth 310k right now. The difference between a 310k and 350k purchase price is the obvious 40k, but then also about $150-$200/month in the mortgage payment. This particular house has an HOA of $60. So the savings from your deal to mine is an extra $300-$400 in my pocket every month. Money that you save is money that you make you know?

If you wanted an opinion on what developments to search in feel free to PM me a few developments you have your eye on and I can tell you how they do. I have 4 properties in the area so I have a good pulse on things.

Good luck!!

-Matt

Kissimmee 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.  It draws international travelers who want to stay as close to Disney as possible, so Emerald Island is in a great location for investments.  A downside is that Emerald Island's amenities haven't been updated in a while and a property there will most likely need updating to compete with other 7 bedroom houses in the area.  Windsor Hills or Windsor Westside are good options if you are considering other areas.  Also south facing lots seem to rent at a higher rate.  

Hi Laura -

I normally work with investors of vacation rentals in the Disney area, but recently I have helped some people sell some vacation homes - 2 in Emerald Island. I urge you to check into the reviews about the community and the HOA. I agree with Melissa's statement above that the amenities are outdated. I have heard a number of complaints about the HOA including they recently raised the capital contribution to join from $1500 to $3000.

One other suggestion I would make to you regarding buying a short term rental here - wait.  The rental market here is currently slow resulting in many owners losing money. More homes may come on the market in the next 2 months with some excellent buying opportunities coming up.  Once the COVID-19 situation calms down, I think our short term rental market will be better than ever because a lot of people who used to stay in the expensive Disney hotels will opt to stay in vacation rentals due to social distancing and they're cheaper. There is a lot more awareness now of vacation home rentals.

Keith

@Laura Jensen , I agree with the comments above in general. Having said that, we are property managers with 75 homes in the area, and we have a 7 bed in Emerald Island which is one of our top booking properties. A lot will depend on the decor and other factors. This home is currently booked at over 80% occupancy through the end of October, with 1 week average stays. Happy to give you some numbers based on this home's performance history, along with your projected expenses. We can also run some comparisons with other communities, to give you an idea.  Happy to help! 

Hi Keith, @Keith Courtney , are you aware if more properties become available since your last post in August? I'm spending the week in Orlando and casually looking for properties (Kissimmee area; 3-4 bedrooms; 2+ bath; low HOA).

Also, what is your take on new construction(ie, Lennar homes)?

Thank you for any insight you may be able to provide.

Hi @Bianca Carmo I saw your post about new construction and Lennar. I am a full time Realtor® and investor in the area and have sold many Lennar homes alone with other builders (we have a very competitive new construction market and tons of choices if you are considering that as an option.) New construction can offer great appreciation if you buy early in a community they are building, home warranty, and generally they will pay most/all of your closing costs if you use their in preferred lender.

I would be happy to talk (or even meet you since you are here) to go over some options and answer some questions for you. Let me know, good luck!

How's the market now? We noticed a lot of homes for sale that have been on the market 60+ days in the area. We're also wondering what's the best area for STRs as I've read mixed reviews about emerald island. 

Ive read good things about solara, Windsor Hills and emerald. Ive read most places average 75% rental? 

Any input/thoughts appreciated!

How's the market now? We noticed a lot of homes for sale that have been on the market 60+ days in the area. We're also wondering what's the best area for STRs as I've read mixed reviews about emerald island. 

Ive read good things about solara, Windsor Hills and emerald. Ive read most places average 75% rental? 

Any input/thoughts appreciated!

Originally posted by @Robert NA :

How's the market now? We noticed a lot of homes for sale that have been on the market 60+ days in the area. We're also wondering what's the best area for STRs as I've read mixed reviews about emerald island. 

Ive read good things about solara, Windsor Hills and emerald. Ive read most places average 75% rental? 

Any input/thoughts appreciated!

Robert,

If you hop on Zillow and take a look at Windsor Hills and Emerald Island, you will see there are over 20 houses for sale in each development in a booming market. Now scroll anywhere else you want to in the area and take a look at how few homes (usually less than 2-3) per development are for sale. That should tell you all you need to know about those communities. 

The HOA fee is absolutely crushing your cashflow in there and the homes are already overpriced as it is. I would look elsewhere in my opinion.

Good luck,

Matt

@Robert NA

I respectively disagree with Matt above.

If you look in Solara, Solterra, Encore, Reunion and ChampionsGate to name a few, there are a good bit more than 2 or 3 homes for sale.  I am not a fan of Emerald Island, but I am of Windsor Hills if you can buy a home with the right features at a good price. 

Regarding HOA fees - The HOA fees pay for the guard gates, community amenities, landscape maintenance, cable tv, wifi, and trash pickup usually. The HOA fees do not crush your cash flow. In most cases it is money well spent.

Keith

having worked as a property manager for 13 years, I agree to stay shy of Emerald Island. There prices are inflated and their homes are stuck in 2005. A 7 bed home in EI would generate less return than a 5 bed TH in Windsor Westside and Windsor Westside is a newer resort community. Windsor Hills is nice if you can find a home that is well appointed but most in WH are older and need some work. I believe the least expensive HOAs in the area are Solterra and Championsgate and they have some great opportunities for purchase with solid returns.