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I live in Durham and I am considering purchasing a beach property. I would plan on renting it in the summer months and using it for personal use in the other months. I'm just now starting to look and I was wondering if anyone could offer up any sage advice. My search area is pretty wide right now and I'm looking to narrow it down. I'd like to be no more than 3 hours from Durham, which would seem to be somewhere between Swansboro to Kure Beach.
I guess I'm just looking for general advice like areas that have much higher insurance rates, areas that are subject to heavy traffic on check in/checkout days, areas where the beach is much more congested, areas that are better in terms of booking rentals. Whatever advice or suggestions anyone can offer up would be appreciated.
Investigate the Crystal Coast area. It is glutted with inventoy (Almost two year supply) with foreclosures & short sales on the rise. First quarter of this year showed 7% of all homes sales as bank owned.
Last edited by SunnyKayak; 04-05-2012 at 09:03 PM..
Reason: tos violation
Correction! 21% of residential properties sold during the first quarter were Bank owned/Foreclosures. 38% of all first quarter home sales (not condos) were cash sales.
I guess I'm just looking for general advice like areas that have much higher insurance rates, areas that are subject to heavy traffic on check in/checkout days, areas where the beach is much more congested, areas that are better in terms of booking rentals.
In parts of North Topsail, you cannot obtain federal Flood insurance.
Otherwise, are you looking to *avoid* heavy traffic? Or, do you regard heavy traffic as a sign of good rental volume?
We have owned a place in Topsail Beach for a little over a year now. We rent it in the summer for the time being but plan to retire there in a couple of years. Some of my thoughts/opinions having recently gone through the process of looking for a house there:
1. Topsail Island also appears to have a lot of excess inventory, with a significant number of short sales and foreclosures. Straight shot down I-40 that takes 2.5 to 3 hours from the Triangle.
2. Insurance is highly variable depending on the location of the house itself. If you want ocean front the insurance rates will obviously be higher. As Goldenage pointed out, North Topsail is difficult to find insurance. We also learned about CAMA in a bid, in that the lot was not re-buildable if the home were lost.
3. We recognized that renting our place wasn't going to cover all of our costs but were pleasantly surprised at how well it did last year. Covered out insurance costs and taxes with some left over to make some improvements. But more than likely plan on having two mortgages.
4. Rental companies, at least on Topsail, charge about 18% of the the weekly rate.
5. We vacationed at Wrightsville Beach for year and really like it there, but the real estate market seems to be more stable there, and consequently places cost more. Topsail Island was affordable for us.
6. Work with a realtor who knows the island you are interested in. It will save you time and money in your search.
7. A fact of living on an island in the summer is heavy traffic on weekends during check in and check out. You learn to work around it.
8. Rental market can be quite variable depending on gas prices and the economy. Topsail Island has a family focus without some of the social attractions of other places.
You can get a pretty good idea of costs by looking at realtor.com, zillow and trulia. That and actual visits to the places that interest you can narrow your search.
Rental companies, at least on Topsail, charge about 18% of the the weekly rate.
Annual rentals are usually managed at 10%. But do be careful. Some agencies/management companies are real good at collecting the check but very poor at anything else.
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That and actual visits to the places that interest you can narrow your search.
Best advice ever but all too often neglected. Scout out locations and interview (face to face) potential management companies.
I rented my townhouse in Surf City for 7 years before I retired last year. You will find that oceanfront homes are much easier to rent in this over-built environment, and you can charge a lot more for them. Mine is not, (It's first row oceanview) and the rental agency I listed with did a very poor job of filling it. I did much better advertising it myself on several rent by owner websites. I was able to fill up most of the summer schedule. My mom lives next door and could handle check in/check out. I also found that the tenants didn't steal things like they did when I used the agency. I think because it's more personal, they knew they'd be stealing from that nice old lady next door and her daughter. I was amazed at the stuff that "walked" the first year.
3. We recognized that renting our place wasn't going to cover all of our costs but were pleasantly surprised at how well it did last year. Covered out insurance costs and taxes with some left over to make some improvements.
This one is tough to swallow for me. For an investment property, I'd like for the rental income to cover taxes, insurance, and some (if not most) of the mortgage cost. As an owner of traditional rental property, all of my costs are covered plus we get a couple hundred bucks of profit each month.
This one is tough to swallow for me. For an investment property, I'd like for the rental income to cover taxes, insurance, and some (if not most) of the mortgage cost. As an owner of traditional rental property, all of my costs are covered plus we get a couple hundred bucks of profit each month.
The question that comes to my mind is how long you've had your property? I prefaced my post that these were my thoughts and opinions (and actual experience). Certainly others have different experience.
Last year was our first year renting a second row house at Topsail Beach. We were pleased with what we got but never expected to cover all of our costs. We did cover insurance, taxes, and some additional to boot. But not enough to cover all of our costs. I would think it prudent to go in with the idea that you would have zero income from the place, since that could be a reality, and work from there.
We aren't trying to squeeze every dime out of the place and are renting it as a bridge until we retire there in a couple of years. We've been generally pleased with the rental company we use that does charge 18%, and that seems the norm on Topsail. They handle the rental, are able to fix things on short notice, and keep an eye on our house, so it is pretty much hassle free for us. The person asking the question lives in Durham, so renting it themselves might be an option. For us that doesn't work so well since we're a 7 hour drive away.
Maybe all the short sales and foreclosures on the market are from people who thought owning a beach house wasn't going to cost them anything?
Last edited by wrestlingterp; 04-10-2012 at 05:14 AM..
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Best advice ever but all too often neglected. Scout out locations and interview (face to face) potential management companies.
