Updated for 2016
Don’t be that guy who thinks he’s going to get rich quick or land an Orlando vacation home cash cow without playing your cards right. You should avoid buying a vacation rental home in Orlando if your reasons are any of these three. A vacation rental home, in some cases, is for the person who just wants to own a piece of Florida and understands they may or may not break even but they don’t care because this is their dream.
1. To Solely Generate an Income
Stop right there and do not pass go. Yes there are MANY Orlando vacation home owners that are making a killing on their vacation rentals and yes there are many that are living solely from the income they produce HOWEVER they had a strategy when jumping into this market. You cannot expect to just throw money at any Orlando vacation home in the Kissimmee areas and make money. You need to know which communities are generating the most rental income, what time of year is best for personal use of your Orlando vacation home in order to maximize profits and you also need to be tied in with the right management company. Otherwise, kiss your income dreams good bye. There is a lot of competition here and if you don’t do it right you will not be making money. You also have to be very careful to who you listen to about where to buy. There are a lot of Realtors who will push you into certain communities because they are getting paid a premium commission to do so, but there is no track record of a strong rental market in those communities. If you don’t care about ever using the property and are just looking for cash flow, consider a long term rental investment instead. It’s a lot less headaches and you will just get a check every month.
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2. For a Quick Flip
So you’ve been bit by the get rich quick bug and have decided you’re going to cash in on some of Florida’s foreclosure properties. . . An Orlando vacation home rarely makes a good quick flip if you’re not purchasing it off the courthouse steps, at least since 2013. The only vacation rental neighborhood in the Disney areas that I have seen investors successfully flipping houses for a profit in is Legacy Dunes and even that’s not what it used to be anymore. Legacy Dunes used to be a nice little gold nugget buried away within Kissimmee that investors were cashing in on but word quickly spread and the inventory has dried up and prices are no longer low enough to flip. If you’re investing into the vacation rental market, expect to be here for the long run. At least be willing to hold your property 2-3 so that you can see some time of return when you sell your home. Also remember, if you’re a foreign national investor you have to pay FIRPTA taxes on the gains when you sell your home. The FIRPTA laws are constantly changing so for the most updated information please contact us directly. We don’t want to list anything here and then it becomes outdated information.
3. For a Beach Getaway
I know this sounds obvious but you would be surprised how many people contact me because they want a beach retreat and think the prices in Orlando are great. Nine times out of ten those people leave very dissapointed when they realize that a one hour and fifteen minute drive is not exactly around the corner. It doesn’t sound like a long drive but if you plan on hitting the beach every day on your vacation than you may really want to consider the west coast of Florida as a better choice. Orlando is not known to be a place to visit for the beach, it’s known for Disney and all of the other attractions. The beach just happens to be an option for many, then again for those of you that don’t even live a days drive to the beach an hour and fifteen minutes may be the best thing since sliced bread.
We hope to earn the opportunity of helping you achieve your investment property goals this year. To set up a free, no obligation investment property consultation with us please use our scheduling tool or contact us directly at 866-422-6191 and if you have enjoyed this article please consider subscribing to our blog and stay updated on future information.