All Forum Posts by: Shawn McCormick

@Ricky M. I'm biased and can provide reasons and data to show that using an agent will protect you, get you more money, less stress and so on.

The reality is you can do it yourself, but tenants generally don't cooperate with showings and that causes lots of problems for buyer to access the unit to show, inspections, appraisals etc. If the lease is at market rents and the unit is in great shape, it could be attractive to another investor. Every investor wants a 'deal', so you need to provide your lease and p&l to show them exactly what they are getting upfront to evaluate the property. If it doesn't cash flow, having the tenant in place doesn't do you much good, do you self manage?. Did you lease it fully furnished? What community is it in? I do a lot of business near the parks with STR and I know the HOA fees can make it really difficult to make the numbers work. Will you seller finance or let someone take it sub2, that could make the difference to attract an investor.

Best of luck!

@Lauren H. This is not legal advice in any way, but I hold my properties (flips, rentals..everything) in Land Trusts and have my LLC be the beneficiary of the trust. Land trusts aren't really for protection, but anonymity and then the LLC provides the protection (to some degree, depending on what happens). There are some nuances you'll want to consider before using them like if you refi the house, you may have a hard time finding a lender to refi with a trust as the owner etc. But still worth it.

I'm in Orlando and have a couple great contacts here that I personally use, not sure if they can operate in Delaware, but happy to provide their info. I have properties out of state and it works for me.

Best of luck

Quote from @Michael Baum:

Quote from @Saulo Dias:

Hi Michael,

I hope you’re well!

I was curious about your insights on the Orlando market. Why do you think it’s challenging to achieve success there?

I appreciate your thoughts on this!

@John Underwood said it best. It very saturated. We looked at places in the right neighborhoods that work for STRs a few years ago (pre-pandemic). There were some great places like a nice 4/3 on a corner lot, overlooking some preserve land. Pool/spa combo, full enclosed. It was just under 400k.

My wife always wanted a place in that area. Seemed like a decent deal! It was a current vacation rental....at $59 a night. The calendar was almost empty. That is practically free.

In order to do well in the great Orlando area, you need a large place. Like a 9/10 or 10/11. Fully themed out. And I mean really done well in order to be competitive.

If you want to get the real skinny, reach out to @Shawn McCormick. He know all the best places to buy a STR in that area.

 Thank you @Michael Baum. Hi @Saulo Dias. I think eveyone has hit the major points of answering your question. I'll answer from a consumer point first. Honestly, I've only booked a STR a dozen or so times. Most often it was out of need for a specific location and space, so I first concentrate on the location, then #beds (typically), once I've narrowed it down, then I go to budget. Now I've got my choices down to just a few at which point I'll look at reviews, but the usually I don't have a lot of choices so even with a couple of bad reviews, I will likely still book and set my expectations accordingly.

From a real estate investor perspective, I think it will depend on where you are and how much competition you have in that market. What is the draw (seasonal vacation, business, sports, beach, mountains etc) who is your renter avatar? If it is highly compeitive like my market of Orlando, guests have thousands of homes to choose from, so they will filter differently than someone that is going to Ft. Wayne Indiana for a funeral and just need a place to stay that is convenient and cost effective and doesn't care about amenities and such. Here in Orlando, for the most part, the home HAS to be stellar to attract the guest that isn't shopping by price first, but the experience. 

You have to know your market competition from every angle (price, offerings, perks, marketing, quality of furniture, neighborhood etc) You can overcome negative reviews if you do a lot of volume, that is almost a given to not be able to make everyone happy or foresee every issue a guest may have. However, do not use that as a strategy or be okay with it, you'll wind up losing the battle.

Hope this helps, reach out if you want to talk more about Orlando. Best of luck

I have two local contacts for you Bell-Harding (HBI) is a local high level CPA specializing in Foreign investors and these scenarios.

Another would be Daniel Boyd a local cost-seg specialist 407-451-8996

Best of luck

@Aspen Lenzen

I live in Orlando, the 'capital' for STR's. I have helped dozens of people buy and sell functioning homes. I market them as basically a 'turn key small business'. In my market, that is a desirable attribute to have it already up and running. If it is performing well, the buyer pays fair market value for the home and enjoys the benefit of some future income with rentals you already have booked.

Although your reviews won't convey, the buyer can have some peace of mind that with future revenue that the first couple of months mortgage are covered while they make adjustments, build up some reviews and work out any nuances they need to. If you have a website, Instagram or other social page for the house, having those convey as well are always welcome.

Our market is heavily driven by STR near the theme parks, so not sure how the SLC market works, but to me, having it still operating is a must. Side note, The calendar can get tricky to work out inspections, appraisers and closing dates as the home may have guests. Your agents will have to work closely with you to make sure no guests are interupted but the buyer has access to the home and you close on a date with no guests that day and the following few days while they go in and take inventory, set up utilities etc.

Hope this helps, best of luck! 

@Brent Warner welcome to the forums!

Depending on what your overall budget is and how much you want to be involved in the house, there are many areas of Orlando that would be a good fit. You could get new construction with your VA loan and when you move on in a year or so, have a virtually brand new home that will be very little upkeep to maintain when you put tenants in there and typically, you will get higher rents in a newer construction home.

If you are handy and can do rehab/updates yourself, you might consider something that you could add value to. In this scenario, you have to make sure the house conforms to VA guidelines in regards to its condition when you purchase.

Happy to talk in more detail whenever you like, I've helped dozens of other B.P. members purchase homes here.

Best of luck and thank you for your service!

hi @Prithvi Raj Sendi I would be happy to talk thru the market here in Orlando. Cash flow has not been easy to get in the last few years due to the appreciation home saw due to the Pandemic.;

I think you'll find this in any big metro in Florida. Insurance and taxes are a big part of the equation too. I believe one way to help combat that is buying a newer home or even new construction (which most are offering great incentives right now). You'll be able to hedge your capital expenses due to having warranties and all of your systems being new. 

We can dive a little deeper on your needs on a call if you like. 

Best of Luck!

@Gabriel Alfaro I would suggest you check out CFRI, the local chapter of the National REIA. We have over 1200 local members and business members with about 20 meet ups every month. We offer education, networking and benefits to help you get started.

We are actually having one our premier events in October called Junkers to Jewels, a 3 day in person classrom and bus tour to learn about flipping, rehabbing, estimating etc on actual deals with local investors. 

If you want some more information check out the website CFRI dot net.

Best of luck

Quote from @James McGovern:

The purchase price in many jurisdictions determines how the property will be taxed. If a buyer wants lower property taxes, do agents tell buyers of new builds to suck it up and accept it?

You really don't have a choice with the tax rate. When the builder sells it to the end buyer, it's been being taxed as vacant land. The county then comes in an assesses value based on purchase price and adds CDD fees if they apply and any non ad-valorem taxes. We get a trim notice around this time of year where you could argue the case your taxes are too high if you choose. So in effect, yes, you have to deal with it. Unless you quit-claim or buy sub2 and do it correctly, you could avoid the transfer of sale and keep the previous owners rate. 

Builders are offering lots of incentives right now in the form of permanent rate buy downs and closing cost incentives. Some will offer 'sale prices' on inventory homes (homes that are withing 60-90 days of being complete or are complete to get them off of their books). However they won't come off of the advertised price. If another buyer was under contract with them and the deal fell apart, they may discount the home, but not outside of those situations. 

For those examples, I'm speaking of the National and big regional builders like Pulte, Lennar, DR Horton etc. You may have some luck with indy builders, but likely the same result. They want to keep the appraised value as high as they can so the next house they build can sell for a little more each time. 

I have relationships with several builders reps that I get lists of homes with incentives and sometimes builder models that come up for sale or cancelled contracts which gives me a slight advantage over others that are just searching MLS. Most builder only put a few homes in MLS so that the public can find them and come in to the models. The discounted ones are only advertised to agents and on their websites.

Hope this helps.