I am considering an investment in Miami real estate (West Palm Beach: fit in, best neighborhoods)

[software_guy]

Hi all,

First post, glad I found this forum.

About me: I have been living in California for many years now, have visited Miami several times over the years, and now want to move here, love it.

I also want to invest in real estate, hoping to grab a couple of rental properties and look after them seeing as to how retirement gets boring after a while

I want to ask the community, is the Miami area a reasonably good place to invest in real estate in the manner I am considering?

Obviously, I can go and ask real estate people, however, I am hoping to hear what people have to say.

Thank you all beforehand,

software_guy

[UrbanPlanz]

Dade County is tough and very expensive. The popular areas are very popular. Broward County is much less expensive and still just 15 minutes to South Beach. Not as glamorous as Dade but a much better return

[City Guy997S]

I would stay out of the tri-county area (Dade (Miami), Broward (Ft Lauderdale) and Palm Beach) simply due to values, taxes and insurance are higher than surrounding areas. Example: 250K budget will get you 2 properties in these counties but may get you 3 properties in surrounding counties. The carrying costs for 2 also but allow you to carry 3 in another county.


Demand maybe higher so you could command a premium in the rents but the costs would eat into the profits.

Cross-country landlord.........that is simply insanity. Time/costs of visiting your properties in the event of a problem will definitely be a hassle.

[MadManofBethesda]

Originally Posted by UrbanPlanz

Dade County is tough and very expensive. The popular areas are very popular. Broward County is much less expensive and still just 15 minutes to South Beach. Not as glamorous as Dade but a much better return

This is the second thread today in which you've made that laughably inaccurate claim. If you're referring to Ocean Drive and its environs, you're not getting to there in 15 minutes from anywhere in Broward County even if you start right on the county line. (Unless perhaps you're driving at 4:00 a.m. when there is little to no traffic.)

Hell, if you try that on a weekend, it could take you 15 minutes (or more) just to get from one end of South Beach to the other!

[bale002]

Originally Posted by software_guy

Hi all,

First post, glad I found this forum.

About me: I have been living in California for many years now, have visited Miami several times over the years, and now want to move here, love it.

I also want to invest in real estate, hoping to grab a couple of rental properties and look after them seeing as to how retirement gets boring after a while

I want to ask the community, is the Miami area a reasonably good place to invest in real estate in the manner I am considering?

Obviously, I can go and ask real estate people, however, I am hoping to hear what people have to say.

Thank you all beforehand,

software_guy

If you buy a 2 bedroom condo cash in some of the best neighborhoods - whether Miami (downtown, Brickell, Coconut Grove, Coral Gables, South Miami, Dadeland), Ft Lauderdale or Palm Beach (Boca Raton, West Palm Beach) - it makes little or no difference -, then your annual yield may be around 2%, including taxes, condo fees, insurance, commissions, and some ordinary maintenance and repairs, but not including any extraordinary maintenance or repairs. The annual yield may be 3% if you buy a more expensive single family home, again in some of the best neighborhoods.

At any rate, you may have to wait 10-20 years for any significant capital gain, and only if you are astute enough to know when it is the right time to sell.

If you need a mortgage and have to pay interest, then forget it - you would probably have negative cash flow or at best break even - unless you think that you will hold it for 20-30 years, and it better be a top quality building in a top quality neighborhood.

In any case, you must do due diligence on each neighborhood and each building, building by building, including both quality of building and its financial statements, then of course on the unit itself.

Higher yields are possible, even into double digits, but more likely in the working class neighborhoods, buying foreclosures and other distressed and damaged properties cash at very low prices, fixing them up - probably yourself or with a closely related and trusted team -, and then renting them. Of course this takes a lot more work, and in dicey neighborhoods.

So risk and reward, as in any other investment.

Talk to real estate people? Are you joking? What do you think they are going to say? They would try to sell you snow balls in winter and fire balls in summer.

Hope this helps.

Good Luck!

[andyo4you]

I would invest in Homestead, fl close to miami ( doesnt have to be miami it could be Kendall good area too). Rents in miami are anywhere from 1500-2500 for regular family homes. In homestead they are around $1000.0 to 1800.0 But, in miami to rent a home for $2000.0 the home will be worth 180k or more. While you can get really small houses in homestead for 50k-90k and rent them from 900-1300. If you do the math you get more from the same amount of money. Rumor has it that there will be a amusement park coming in the next few years ( dont know if its true, it sure makes sense) If that really happens then I see people driving from miami to work in homestead. Also, invesment wise you dont want to spend a lot more money fixing a destroyed $200k+ property than fixing a lower 80k home. My uncle has around 8 houses around miami, they are all rented at good prices, he doesnt work at all ... ( i believe he makes around 5-6k from them) In a few years I will start doing the same.

[andyo4you]

I belive in the 15% rule. Buy a home (cash) that you can get the same amount of money you invested in less than 7 years. $80k home rent it for $1100-1300 at 1300x12=$15600x7 years = $109,200 cost you $80k and you probably paid less than $1500.0 a year for taxes and insurance about $1500-3000. Lets just say that all the rest apart from the $80k is taxes, insurance and fixtures, you can triple the money in less than 15 years. There is no market with less $ that cant beat %15 returns other than starting a small business. If you know of one that is legal let me know! CD's are only giving us 1.5% and we lose more than that do to inflation! rip off.

[lls1662]

I see you started this post a couple weeks ago, If you're still interested in investing in real estate in the area, please supply a few more details.

How much can you comfortably afford? Are you looking for something ready to rent or are you willing to rehabiiitate? What kind of return do you need? Are you a cash buyer? Have you ever been a landord? How long do you plan on holding the properties?

Need more information to answer any specific questions. But, yes, investing in real estate can be lucrative. It can also be very costly (remember 2007-2009?).

[hurricaneMan1992]

Originally Posted by MadManofBethesda

This is the second thread today in which you've made that laughably inaccurate claim. If you're referring to Ocean Drive and its environs, you're not getting to there in 15 minutes from anywhere in Broward County even if you start right on the county line. (Unless perhaps you're driving at 4:00 a.m. when there is little to no traffic.)

Hell, if you try that on a weekend, it could take you 15 minutes (or more) just to get from one end of South Beach to the other!

I was going to give the same response...LOL...is there not a flag for "reader beware?"

From Aventura, just south of the County line, it takes me a solid half hour without traffic to get to the 17th st parking garage beside Lincoln Road....5 minutes more if I want to park by Ocean Drive. Only 5 minutes of that is getting from my place to the Ives Dairy onramp (with traffic, mind you, that alone takes 10-15 minutes...). Incidentally, going down Collins Ave. takes me about the same amount of time, many red lights, but it's a more direct route.

[hurricaneMan1992]

Originally Posted by andyo4you

I belive in the 15% rule. Buy a home (cash) that you can get the same amount of money you invested in less than 7 years. $80k home rent it for $1100-1300 at 1300x12=$15600x7 years = $109,200 cost you $80k and you probably paid less than $1500.0 a year for taxes and insurance about $1500-3000. Lets just say that all the rest apart from the $80k is taxes, insurance and fixtures, you can triple the money in less than 15 years. There is no market with less $ that cant beat %15 returns other than starting a small business. If you know of one that is legal let me know! CD's are only giving us 1.5% and we lose more than that do to inflation! rip off.

80K places won't likely rent for $1500. Condos where I live start a little above $100K, and I'm paying just under $1K in rent. Brickell condos that rent out for $1500 likely sell for over $200K, plus there are high HOA fees. Houses going for $80K are likely in the ghetto and won't rent for much.

I can imagine if you bought cheap right after the crash and are now making money since rents went up, but don't expect to buy a place nowadays and have positive cash flow in 2-3 years, especially since rents have pretty much stabilized. However, depending on how hot the current bubble gets, you might be able to sell for a nice profit in 5 years or so....