How do you decide what size, type and location of property to buy?
How many bedrooms and what size home?
People always ask us what is best - a 3 bedroom or 4 bedroom home (or larger). We are finding currently that the 3 bedroom houses seem to be renting out more often than the 4 bedroom and larger houses. In addition, they are usually less expensive. However, if you can find a nice 4 bedroom home for a very reasonable price, then it makes sense to buy it. There is definitely a market for bigger homes (5 bedroom and up), especially when larger families or multiple families want to vacation together, but of course larger homes are much more expensive to buy and to maintain. In the long run, the bottom line usually works out the same. Smaller houses have less rental income and smaller expenses, while bigger houses have bigger expenses to offset their bigger rental income. It really all comes down to a matter of taste and initial affordability. The bottom line is that most tourists are more concerned with having a clean, well maintained, comfortable rental home than they are about the size.
Best location for rentals?
For vacation rentals, anywhere within 15 to 20 minutes of Disney is fine and within that radius, there are many neighborhoods to choose from. There are four different counties (Orange, Lake, Osceola and Polk) all coming together around the Disney area and where they meet is known as Four Corners. Most vacation rentals are located in Davenport and Kissimmee, with some in South Clermont and a few in South Orlando (although the majority of properties zoned for vacation rentals in Orlando are condos and condo-hotels, much more than private pool homes). Of course, for those who like to golf, we can always find some excellent homes in golfing communities. These are usually more expensive, but can be easier to rent out, especially to other golfers. If you are buying for long term rental, then you are not tied to short term rental zones, but these areas are still very good for long term rentals, because of the large number of renters working in the tourist industry.
Condo with community pool, or single family home with private pool?
Condos usually have high monthly condo fees and the more amenities and features, the higher the fees. You are also subject to the strict rules and regulations of the condo association and it is not uncommon for condo associations to occasionally charge each owner assessments to cover improvements in the common areas. Many lenders are not happy to lend on some condo buildings and often have strict requirements for the number of permanent residents living there versus investors, as they are looking to minimize their risk. As a result, most condo buyers in recent years have paid cash. Condos do attract buyers who feel more secure and also who prefer not to be concerned with maintenance.
Owners of single family homes with private pools are responsible for paying for their own pool service and landscaping, but this is offset by the much lower monthly association fees. Most homeowners associations charge lower fees than condo associations (however, there are some neighborhoods in gated communities with lots of features and amenities where the fees are quite high). Financing is usually easier for private pool homes than for condos. Having a private pool is also very nice and there are obviously less people around, so less chance for noise and disturbance.
At the end of the day, both condos and private pool homes rent out equally well, so it just comes down to personal preference as to which one you decide to buy.
New or resale?
In our opinion, pre-owned homes are generally a better value, easier to purchase and can close more quickly. Because they are generally found in well established subdivisions, construction problems such as noise, dirt and other inconveniences are avoided. This is better for your tenants and for your property values. Property values of new homes generally do not increase as quickly as pre-owned homes, due to the continuing construction in the new home neighborhood. However, we do realize that many people do prefer a new home, usually because of the anticipated lower repair costs and the freedom to choose floor plans, color schemes and furnishings. If these personal choices are more important to you than the higher price and the longer waiting period for closing on a new home, then this may be the best choice for you. Dolby Properties works with most of the local builders and we are very happy to help you, if a new home is your choice. You pay nothing for our professional services, as we are paid by the seller/builder and you pay the same whether or not you go directly to the builder, or go through us. It just makes more sense to have us help you through the entire process, which can be time consuming and frustrating at times, especially if you are not on site. However, it is very important to contact us BEFORE going to see a model home or talk with the builder, or else we will not be able to help you.
How old a home?
We actually hear many people, especially from the UK, saying that they have been told that they need to buy a home less than ten years old because "older" homes are inferior in many ways. This is simply not true and in many cases the vast number of UK companies promoting new homes have caused that rumor. If you jump on that "must always have a new home" bandwagon, then you will continually be trying to keep up, because very soon your brand new home will also be "old". If this were true, no lenders would ever lend on any real estate here, because after ten years they would expect their investment to crumble. Most mortgages are for 30 years, even on homes much older than 10 years, which proves that lenders are definitely willing to risk for at least that length of time.
Most older homes have actually been updated or remodeled since being built, often including new roof, plumbing, electrical wiring etc. Back in 2004,when Orlando suffered from three hurricanes, those of us at Dolby Properties whose homes were more than 30 years old actually had less damage than those of us who lived in brand new homes, so worries about older homes are really not necessary.
Pool or no pool?
If you are buying a single family home for short term rentals, it is definitely preferable to have a private pool, as tourists will always want a pool. However if you are buying to rent long term to full time residents, a private pool isn't as important to most residents. If you do buy a long term rental with a pool, we recommend you personally pay for the pool service, rather than expect the tenant to pay for it, because not all tenants are so diligent in handling the regular maintenance required to safeguard your costly investment in a pool. If you are buying a condo for short term rentals, then you should definitely buy in a condo building that has good community facilities including a nice pool.
Dolby Properties is very experienced in knowing which areas are properly zoned and which areas are good rental areas, whether for short term or long term. We know exactly what tourists are looking for in a vacation rental and we know which areas are good for residential long term tenants. Trust our years of local knowledge and experience to help you find the property which feels most comfortable and affordable for you. E-mail us to get started at: firstname.lastname@example.org