I'm in California (Los Angeles area) and I have been thinking of investing out of state for years. 2 reasons why South Florida appeals to me at this time:
1. the LA market is ridiculously saturated with investors, competition and I what I feel is a bubble.
2. I have family just moved near Ft. Lauderdale and I'll be visiting the area often.
I was wondering if you know about the area or if investing in SFR or multifamilies is good now for buy and hold in that area? I'm looking for rentals that can substantially beat LA returns in pretty decent areas like B class neighborhoods in pretty good shape and easily manageable from out of state.
I have a lot of experience managing and landlording rentals in Los Angeles.
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I have some friends that are flipping in Orlando and doing quite well. They like central Florida over the Miami/Ft. Lauderdale area because of housing prices. Having said that, be aware that if you are doing buy and holds that Florida has laws written to protect the tenants...some more stringent than the California laws. Just educate yourself and find a market that you are comfortable in.
I lived in South Florida for almost four years before relocating and I can tell you I'd take Ft. Lauderdale over Miami for investing in buy & holds. It is pretty competitive but I doubt anywhere near the scale of LA. There are a lot of hedge funds that have been buying up SFRs at full asking price for the last year plus...I actually sold my house to one (Silver Bay).
In my opinion, the best area is west Ft. Lauderdale around Davie, Plantation, and Sunrise. West of the turnpike in those areas is a pretty safe bet and west of University Drive is even better. There's a lot of new construction & infrastructure going in, Broward Mall & Sawgrass Mills along with Nova Southeastern University are all within a 20 minute radius of each other. You can also find some decent property near the beach but expect to pay a little more per less square foot. If you have any questions about the area or need some connections down that way feel free to PM me!
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I live in LA and was born in Ft. Lauderdale and lived there off and on, and I can tell you that the returns in south FL will be better than what you would see in LA, but you are likely not going to see positive cash flow there either. The housing prices are higher, and then add some nasty insurance and property taxes expenses, profit isn't a common thing in south FL. Usually the the only time you will see profit expectations on paper there is investing in the bad areas, and that is debatable in itself.
Not saying it doesn't exist, but make sure the numbers suggest a profit. It will be tougher to find down there. But I do recommend Ft. Laudy suburbs over Miami suburbs for sure. Plantation, all those. But even those might be tough.
I am going to Agree with the others in suggesting Fort lauderdale.
On your next visit to south florida, pay attention to the number of Govt. sub. housing in the Miami area. IMHO this makes it very difficult for a smaller scale investor to compete for tenants. Joe
I recently moved from Fort Lauderdale to ATX and agree with the statements above. I had a rental in Pompano that barely broke even every month. I do have a couple friends that were having success flipping houses there, but more so the last few years when the market was flooded with inventory and prices were so low. Also, I had a conversation the other day with someone who is moving his REI business from Fort Lauderdale to Houston to begin investing there. Seems to me that the growth that Florida has enjoyed historically may be shifting to TX.
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