[loveTC]

My husband and I are retired snowbirds, with a house in Florida and another in Northern Michigan. We are considering buying properties in Traverse City for rental income. We especially are thinking of duplexes or triplexes. Here's the question/s: How is the rental market in Traverse City? Is there a population interested in rentals? Is it necessary that the rental be in town, as opposed to Acme, Williamsburg, etc.? Are people leaving TC as they are other areas of Michigan? What do you think is the future of the rental market in TC?

Thanks for your help!

[mileslong]

Even though I think TC is not doing as bad as the rest of the state, it is still not doing well. I would not invest in any rentals in Michigan at least not now.
I sold all my rentals and am so glad I did.
Michigan is just not a good place to invest right now.

[malamute]

I think property on a lake -- cottages and homes that rent out to vacationers can be good, depending on the lake. Vacationers will pay pretty well for a week or two on a lake.

[cjbailey]

I currently am a landlord of a beautiful northern MI home near Petoskey.The problem is that our "season" is so limited and has been getting shorter each passing decade. High demand in July and August, june and september bring some renters. It's very hard to make that equation work. I rent my home out year round to a local, but I don't get highest dollar becasue locals don't make a lot of money. Thats about it.
'

[michiganbob]

A friend of my wife's bought a house to "rent out during the summer" in Petosky three years ago as an investment and possible retirement cottage. First summer (2005, I think) it was rented out almost every week of warm weather and they covered their 12 months of mortgage payments. Summer of 2006, they had about 1/2 to 3/4 of the weeks rented, still managed to cover. Last summer: only about 1/3 of the weeks were rented and they had to drop their price to get those. They lost money for the year and if it doesn't improve in 2008, they may lose the house.

Not saying that will happen to you, but just a word of warning. If you start looking around TC and finds lots of "great deals" on houses that are/were primarly used as summer rentals, that should tell you the locals are unloading because they know something.

[Jasmin71]

Its because all the Houses on the market,, people rather buy then rent right now

I would not buy a rental right now.... unless you have the Money to cover if you dont rent it out

[TaxBait]

It's a great idea if you'd like to earn a lower return on your money than CDs and enjoy risk taking & aggravation. The only economic model that makes any sense is to take advantage of depreciation and other inevitable writeoffs to reduce taxes on other current income in hopes of future appreciation on the property. Since you're retired that wouldn't apply.
MI is an especially poor place to be a landlord due to the higher property tax rates on non-owner occupied properties. As an example, my parents own a house in TC valued at $140K. The taxes are $300/month. It would rent for about $800/month. That's only 4 1/4 percent return without considering any expenses. Outside TC proper, the tax rates and home values/dollar aren't much better.

[elisabetm]

I think it would be better to purchase something on the southwest side (South Haven, New Buffalo...) Lots of Chicagoans vacation there.

[Jswee]

I am a Traverse City native and am also the managing partner in a Real Estate LLC that owns rental properties. Tough rental market in the TC area right now. Historically rentals have been hard to find so there was a ready supply of good quality tenants and rents were at a premium. The burst of the housing bubble has flooded the market and rental rates have dropped and vacancy rates have risen.
You should also be aware that some townships in the area do not allow week to week rentals of vacation properties, so make sure you do your homework before getting into a seasonal rental scenario.

I also own a Real Estate brokerage in TC, so I have some insight into the market from that perspective. Great time to buy, lot's of very attractive opportunities in the foreclosure and short sale arena. The market has not bottomed out up here yet, I see another 6-12 months of falling property values. The long term investor will do very well if they acquire something in the next year to 2 years and can keep it for 5 or 6.

Feel free to PM if you have any specific questions.

[chambana]

Originally Posted by Jswee

I am a Traverse City native and am also the managing partner in a Real Estate LLC that owns rental properties. Tough rental market in the TC area right now. Historically rentals have been hard to find so there was a ready supply of good quality tenants and rents were at a premium. The burst of the housing bubble has flooded the market and rental rates have dropped and vacancy rates have risen.
You should also be aware that some townships in the area do not allow week to week rentals of vacation properties, so make sure you do your homework before getting into a seasonal rental scenario.

I also own a Real Estate brokerage in TC, so I have some insight into the market from that perspective. Great time to buy, lot's of very attractive opportunities in the foreclosure and short sale arena. The market has not bottomed out up here yet, I see another 6-12 months of falling property values. The long term investor will do very well if they acquire something in the next year to 2 years and can keep it for 5 or 6.

Feel free to PM if you have any specific questions.

Since this forum doesn't have a members list w/email links...I am interested in
TC(with 30 mile radius) area properties. Does not have to be lake property.
Probably will build, though it's possible that we will buy an existing home and remodel. Am looking for 5-10 acres. Can you send me your website? Also, where can I find info on property taxes? Doesn't need to be exact...ball-park figures OK.

thanks,

mark

mark