Are you a real estate investor looking to own a property in Florida?
With warm weather and beautiful beaches, Florida has long been appealing to both long-term residents and vacationers. So it makes sense that investors would look to Florida for real estate investing.
However, before you get started, there are a few tips you must know. Understanding these will increase your chances of a successful investment.
Here are three tips to get you started.
1. Determine Your Investment Strategy
First, you need to determine what your investment strategy will be: active or passive.
Passive real estate investing is a hands-off approach that involves buying shares through crowdfunding or REITs (real estate investment trusts). These properties are fully managed for you.
Active real estate investing includes options such as house flipping and buying and managing properties yourself.
There's also a third strategy: mostly passive. In this strategy, you buy and own physical property, but have a mostly hands-off approach. Instead, a property management company covers day-to-day operations.
If you're looking to have more control over your investment, a mostly passive strategy is recommended. This works for both traditional home rentals and vacation rentals. While there is some work involved, major operations such as maintenance and repairs, as well as tenant screening, will not be your responsibility.
2. Understand the Local Market
Real estate investors also need to understand the local market.
Consider what fair market property values are and if they are trending up or down. For example, the average Sarasota real estate rent is now over $2,000 a month. Manatee County real estate is similar, with the median rent there approaching $2,000 a month.
Understanding the local market also means understanding what a property's value and income potential are. Once you understand that, as well as having an idea of what your expenses will be (property tax, insurance costs, marketing costs), subtracting your expenses from your income will give you your cash flow.
Ideally, your cash flow will be positive. However, if you're not sure what your cash flow will be, you can use a rental property calculator to find your cash flow.
3. Know the Law
Finally, you need to know the law. Rent a property long enough, and odds are that a legal situation may arise.
Eviction processes vary from one location to another. Security deposits may be capped by local laws. You will also need insurance coverage for your property.
Again, here is where a local property management company can help you since they will be knowledgeable about local laws and regulations.
Get Started as a Real Estate Investor
Are you a Florida real estate investor, or a soon-to-be one? If so, you need Gulf Coast Property Management.
Whether you need help managing your vacation home or annual rental management, we can help. We assist you with all aspects of property management, from marketing to tenant screening to rent collection.
Fill out our contact form to find out how we can help you, or give us a call at (941) 782-1559.