I'm I an idiot for considering investing in real estate in SW Florida? (Cape Coral: bank owned)

[pmak]

Hello, I'm a 30 year old high school math teacher from NW Indiana(really a suburb 45 min from chicago). I'm married(wife's a math teacher too) with a 2 year son and 6 month old girl. We each have family within a hour of CC/fort myers area. With all our time off as teachers we are considering buying a vacation home/condo. We have been investing $300 a month in our 403b since we started teaching and would have been better off if we just buried it in the ground. So, thats why we are considering investing it in something we can use. I've been reading this forum and others on the internet about condo dues increasing due to foreclosure, chinese drywall, lack of jobs pushing prices down, etc. Even though prices still could go down in the short term, I cant imagine them staying low in the long term with the climate appeal of Florida. Prices look cheaper down there than Detroit, Cleveland and even Gary. If we like it down there, we've considered becoming full time res and find teaching jobs(seems easy to find a job as a high school math teacher just about anywhere). We are vacationing down there next week during spring break. I've been looking on trulia.com and have a local realtor sending me listings. most promising one we've seen is a 2/2 condo in the heart of CC just south of pine island road with a fresh water doc for about 65K. I have alot of questions and I'm open to any other advice. Thanks again. RJ

Is that area safe?
What is the safest type of property to invest in condo, home, multi-unit?
Are properties under 100k still going to have outraguous insurance costs?
Is fishing good in these freshwater canals? are the bluegill eatable? big bass? dirty from all runoff? what kind of boats do people have? pontoon?jet skis? speed boat?
Is it easier/better to rent monthly or weekly? Are vacation properties still easy to rent out?
Any recommendations for property managers, to clean etc? what should I expect to pay?
What about San Carlos Park? I've seen some decent homes in that area(I love to golf and fish, wife loves the beach).
Will the realtor know/have to disclose any back payments/assessments some of these properties have? Do I have to check for these?
Any "newer" houses with pool under 100k?

Thanks again!

[Florida Paradise]

What is the safest type of property to invest in condo, home, multi-unit?
Are properties under 100k still going to have outraguous insurance costs?
Is fishing good in these freshwater canals? are the bluegill eatable? big bass? dirty from all runoff? what kind of boats do people have? pontoon?jet skis? speed boat?
Is it easier/better to rent monthly or weekly? Are vacation properties still easy to rent out?
Any recommendations for property managers, to clean etc? what should I expect to pay?
What about San Carlos Park? I've seen some decent homes in that area(I love to golf and fish, wife loves the beach).
Will the realtor know/have to disclose any back payments/assessments some of these properties have? Do I have to check for these?
Any "newer" houses with pool under 100k?

Thanks again![/quote]

Here are my answers to your questions based on my "recent" experience buying an investment property in Ft. Myers...

1.Safety... well after my in-laws living in Ft. Myers for 15 years and after my extensive year long search, I would "invest" and/or choose to live West of 41 and South of Colonial, in what they call South Ft. Myers. In this chosen area, you will be hard pressed to find anything other than a 1 unit condo/townhome. Not many single family homes in the "under100 grand" price range, but this area is mostly snow birds and or seasonal renters. It is pretty quiet and close to the beaches. (Ie: Iona...McGregor...Cypress Lakes
2. I couldn't tell you about insurance rates, as mine are included in my HOA fee. Some Hoa's include some (outside) insurance and some do not. Very important in researching rates.
3. Fishing, I am clueless except to say we only fish ocean side and yes we do eat them.
4. Rentability... I rent my townhome out but rentals are dependant on what you are allowed to rent them as from your HOA. Some HOA's allow weekly (but only ones on or near the beach) Some only allow renting 3 months at a time and some monthly. I rent mine for 3 months at a time which limits me to that "in season" block of Jan/Feb/Mar.
5. I don't use a rental agency.
6. San Carlos Park isn't that nice at all. I looked at a few places there and didn't not like the feel or the reputation of the area. it was a big NO from my residential in-laws.
7. Assesments/back payments... It depends on what kind of listing you buy. If you buy a forclosure the bank pays for everything! Short sales used to be the same, but I understand that is going to change. I bought my townhome and the bank had to pay almost $10,000 towards closing coast/back HOA dues etc. My closing costs were 400 hundred on a $40,000 unit (bank owned).
8. Newer houses you want to stay away from. Chinese Dry Wall. In fact I personally wouldn't buy anything that was less than 8-10 years old. It is everywhere down there.
Just my 2 cents. Good luck

[pmak]

thanks for the input. I was looking at some 3 bed 2 bath houses in san carlos park with pool/lanai for around 90k. whats wrong with the feel? its still w of 41 or "south fort myers", right? Still wondering about fishing in freshwater canals. where are the 40k townhouse? how much for HOA? The condo I'm looking at in central cape is 200 a month and supposed to cover outside maintance and insurance. I think when this tax credit is over and when the banks put more properties on the market, that prices might still go lower. If we get a house we probably will have to split it with another couple. Keep sending ideas! thanks again!

[Angelala]

I too live in NW Indiana (25 min. east of Valparaiso) and we have had a house in Cape Coral for almost 3 years and don't regret it one bit. You should spend time there look at houses and then make a decision on where you want to buy. It's a buyers market right now! And it's usually cheap to fly out of midway to Ft. Myers, except during spring break time. Sometimes we only pay 69.00 one way!

[pmak]

angelala-

25 miles east Laporte, walkerton? We live in Lowell. Do you rent it out when youre not there? Who manages your property?

[Angelala]

Originally Posted by pmak

angelala-

25 miles east Laporte, walkerton? We live in Lowell. Do you rent it out when youre not there? Who manages your property?

You got it! Actually Koontz Lake. No we don't rent it we have a guy who takes care of the pool for 75.00 a month and a person who takes care of the yard for about 40.00 a month. The electric and water bill are sent to our house in Indiana so I just pay it online. We have friends that are down there right now looking for a house to buy. They are looking at a few HUD houses that need some cosmetic work.

[nhkev]

not too give a stranger financial advice not knowing their entire financial situtation but yes I would think it would be idiotic to take money from your 403b to purchase real estate, with the exception of a primary residence.

My own personal rules: Retirement funds are off limits. If you are not getting the returns you desire it may be your fund choices can be changed. despite the short term recession stocks still have avg 10% annual return since 1926 and about a hundered years before which included a depression and about 3 recessions. A lot has to do with timing and at your age you have plenty of time for upswings and yes more dips.

[Samiamnh]

Would definately not eat anything caught in a man made fresh water lake.Reason is....they are nothing but catch basins for runoff from streets and lawns.I'd buy a canal lot with gulf access if fishing is important to you...there are still some nice ones in CC in the $150k range.Sure to be a good investment when the market comes back.

[freddyCF]

At 30 years of age I would continue to contribute to a 403b plan and try to put away much as possible for retirement. Have you started any 529 plans for the kids for college?