Just wondering how this area is. What's the outlook moving forward the next 5 or even 10 years?
My wife bought a property here in 2005, close to but not quite at the peak (She got an insane offer in '07 and regrets not selling) after a catastrophic burst it has slowly regained value and now seems to be worth around 80% of its original purchase price. It essentially breaks even with the mortgage at the moment and should be paid off in several years, but I'm curious to know whether we should look to sell soon or not.
Thanks in advance!!
@Maxwell Lee I would be glad to give you my opinions of the area. Send me a PM with the actual address so I can get a gauge for the exact property and we can talk further
I guess the question is could you get a better return on equity in the house than what you're currently getting. That is assuming you're not upside down. Florida in the year 2016 had a net influx of 367,000 people. They are all going to need a place to live. Absent a significant black swan event, growth in Florida should continue. Higher interest rates are the wildcard but people are still going to want to be out of the cold and into the warmth in their retirement years. Sorry I can't give you more information on that specific area of St. Petersburg. We have been in Sarasota which is growing like crazy.
Hey @Maxwell Lee ,
I buy and sell a lot of properties all over Pinellas county. Pinellas Park is kind of an interesting place. It is hard to tell exactly tell what the 5-10 year outlook will be, but I can tell you what I'm thinking.
With St. Petersburg growing the way it is, It could potentially hurt say Kennith City and Pinellas Park. As Prices rise around Downtown and Central Ave, It could push some of the renters in south St. Pete up towards Pinellas Park and surrounding areas. There won't be a mass exodus by any means, but over the next 10 years I realistically see Pinellas Park staying about the same.
This is all speculation, but from buying and selling many houses and working with investors from all over the area this is what I think. Let me know what you think.
I own a lot of property in and around St Pete and while many areas of St Pete have been booming there are neighborhoods that are declining in the area too. A lot of the low income folks have been priced out of the fringe neighborhoods in St Pete as those prices used to be low and have now shot up. I've seen areas like Lealman really decline with an influx of bad tenants coming in and crime going up. I'd lump in some parts of Pinellas Park into Lealman but the area you're talking about is a blue collar working class area that should be fairly stable for now but I wouldn't anticipate any big gains there. It's also the type of area that can be hard hit with price corrections if rates tick up too much.
Originally posted by @Maxwell Lee :
@Brandon M. Thanks shot you a PM.
@Jeff Tallard Thanks for your thoughts!
@Colin Mooney Is South St Pete filled with bad tenants? I'm not sure I totally follow your train of thought here.
South St Pete isn't "filled" with bad tenants but many parts of St Pete south of central are pretty rough, especially until you get south of 26th Ave S. There are areas you can drive through that most people wouldn't be willing to get out of the car. That being said I own about 30 properties in the "south side" and I have some great tenants that have been with me for years, my average tenant stays 3.5 years. It's an area that requires a hands on approach to managing and screening as well as careful purchasing because you really have to take it block by block....there are blocks where they sell drugs with impunity and there are blocks dominated by owner occupants that have been there for 30 years that won't let any of that crap happen in front of their houses.
@Patrick L. Thank you for sharing.
Over the next 5-10 years, you'll get amortization and surely at least some appreciation. Its a decent area and we won't experience another 2008 any time soon.
I think if you're cash flowing the property safely, you shouldn't sell it. Since the mortgage is basically the full retail value, it doesn't sound like you'll make hardly any money from selling it anyways.
Keep the house and make the slow nickel every month is my opinion.
A few more details. It's really not breaking even, it's definitely negative cash flow if you consider capex. But at least we're making something with the mortgage pay down.
3 years ago we looked at selling and were expecting to walk away with around 25k. Not really worth it at the time. Today I'm thinking we'd be looking at 60k. Which might mean it's definitely worth moving that equity into better ROI. If no one thinks this has good long term prospects then we just might do that. Thanks again for everyone's feedback!
@Colin Mooney makes an excellent point. I agree.
Really good insight @Patrick L.
I've been watching S St Pete and really think it's still an awesome place to snag some properties for long term rentals as long as you do your due diligence at screening and managing tenants
We have a rental in the 3900 block of 54th avenue and we like it. We don't love it but it is easier to get in but the reno costs might be a little higher during the onset. Screening tenants is huge in this area and will make or break the project.
Just to bring this to a conclusion:
We successfully sold the property on Monday. It was a duplex pulling in $1600 but actually losing money when you factor in vacancy, maintenance and capex. We sold it for $151k after 2 months on the market (including about one month with the main unit vacant).
Anyway I consider it a victory...we successfully staved off two lowball offers in the 120s and avoided having to do any repairs for tenant turnover (or any repairs at all for that matter). And my wife's loan was paid down more than expected so we walked away with a decent chunk of change. With this sale we are now consolidated to the Jax and Indy markets. I would certainly consider Tampa/St Pete in the future however.
Thanks for your advice here. Onto the next one!
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