Investing in South Florida (Miami, Tampa: sales, real estate, rental)

[Mizi]

Hello everyone,

My husband and I are looking to invest in a condo in south Florida. We want a place where we can visit (we live in NYC) and eventually retire to. Need to be near the beach and nice restaurants. I keep hearing the gulf coast is better than the atlantic coast, so I would love to hear feedback on that since I've only been to the atlantic coast (Miami, Ft Lauderdale). Our budget is between 300-500k (may stretch a little if it's the right place) and would love to be close to the beach. We have two children (ages 15,7) so would definitely like to be near things to do. Thank you in advance!

[Southern Star]

Check out Sarasota. It’s a very nice city with lots to do.

[City Guy997S]

Sarasota yeah right......15 and 7 yr old will be bored to death!

Don't buy anything, you will never use it enough to justify the annual expenses and your taste will surely change in the next 20-30 years when you retire. You will soon get to the point the kids won't want to go anywhere with you nevermind back to Flariduh every weekend.

[aridon]

I wouldn't "invest" in a condo down here. Prices right now are very high and in many areas probably not sustainable. Condos always get nailed the hardest in downturns and are the easiest to over build and over supply the market. I would recommend just holding off buying right now in FL unless you are planning on living here full time. Investing right now in a condo is a poor investment in most areas of FL. You will almost certainly be able to buy something in a downturn much cheaper than right now at a peak given your time horizon. VRBO or whatever for a unit for your vacations until you're ready.

[Mizi]

Thanks for your replies. We are not actively looking where the purchase will be in the next few months, I still have a couple of years left to retire. Most people hear the word "retire" and think its WAY down the line, but my husband and I are both union employees (I'm a public school teacher) and have about 8-10 years left. We love Florida and have been going back and forth since I was a kid, and that's where we are ending up. Can't move there now because we have good gigs here (teachers in Florida don't make close to the amount of money that teachers in NYC do) and I'd like to retire with that amount. We have also been thinking of investing in a property that we may be able to rent when we are not there. Has anyone responding to this thread had any experience with that? Thank you!

[craig10x]

Like you, i have only been to the atlantic side because my dad had a condo in broward county...But i have a cousin who lives on the gulf side (in clearwater) and he says that Tampa and also St. Petersburg are very nice and have lots of lively areas...Perhaps someone who has lived or been to those areas can enlighten you further here...

[City Guy997S]

Originally Posted by Mizi

Thanks for your replies. We are not actively looking where the purchase will be in the next few months, I still have a couple of years left to retire. Most people hear the word "retire" and think its WAY down the line, but my husband and I are both union employees (I'm a public school teacher) and have about 8-10 years left. We love Florida and have been going back and forth since I was a kid, and that's where we are ending up. Can't move there now because we have good gigs here (teachers in Florida don't make close to the amount of money that teachers in NYC do) and I'd like to retire with that amount. We have also been thinking of investing in a property that we may be able to rent when we are not there. Has anyone responding to this thread had any experience with that? Thank you!

Sit down with a piece of paper......

add up the HOA fees, insurance, taxes and mortgage costs, travel costs to/from the property, house management costs. Subtract the fantasy rent amount and you will have some type of carrying cost. Now multiply that by 10 years.....showing your "cost" or loss for the next decade assuming no catastrophes, deadbeat renters, damage etc.

In order to justify that above fantasy, you would expect the condo would have at least appreciated by the "cost amount." Lets just say 10K yr, 100K total after 10 years. If your 400K condo didn't go up in value 30% plus (100K appreciation, plus 5% real estate commission= 520K) then it is a bad investment.

Now if the above equation hasn't rocked your decision. Then take the amount of money you were going to spend on this investment (you could use just the "loss/cost" amount or even use the whole amount you were planning to spend) and see what it would do in an investment vehicle over 10 years. So either 10K a year in a fund or 10K yr plus whatever you planned on putting down and give yourself a reasonable 6% return (plenty of online calculators to show the TVM- time value of money). When you get this number, your eyeballs will fall out of your head and you will definitely NOT buy a condo until you are going to actually live in it yourself.

[City Guy997S]

Similar situation:

I noticed a very nice rental locally. It is easily a 3mm house (older but strong lot value based on recent sales on the block). $7500 a month rent, 2500 sq ft.

The taxes would be about 60K, insurance probably 20K......so 80K in carrying costs right there, forget the 3mm downstroke! So if I can rent the place for 90K why would I ever buy it for 3mm unless I thought it was going to appreciate 10-20% over the next 2-3 years.

If I was getting 6% on 3mm- 180K a year then the rent idea is a no brainer!

[NY 915]

Originally Posted by Mizi

Hello everyone,

I keep hearing the gulf coast is better than the atlantic coast, so I would love to hear feedback on that since I've only been to the atlantic coast (Miami, Ft Lauderdale).

And when it comes to Florida I feel the ocean side is the best side...but maybe I have been spoiled by growing up near the Atlantic on Long Island...but I loved living in Ft Lauderdale, Hollywood and West Palm Beach near the ocean.....I never lived on the gulf coast but have visited and just my opinion but there isn't anything that can match the appeal of the Atlantic ocean...

I haven't been in Florida in 20 years now but the Tequesta area was always a nice safe friendly community and close to the ocean....I would check out that area for an investment condo...as well as the Village Blvd area of West Palm Beach.

[wizrap]

Mizi, listen to CityGuy; that advice will save you lots of problems and money.

We were out of town landlords for our South Florida home, and even though we had a good, profitable experience, I don't feel being a landlord is for everyone.