Investors in North Florida?

Question

Hello, I am looking to invest with my fiance in the Fort Walton Beach area in the next couple of months before the end of summer. If you are a realtor, investor (military or not), or know about the market in the area, I would like to connect with you.

We haven't bought a single property yet, but are very excited to start this journey together! Fort Walton Beach seems to have more affordable houses, but not much is going on in the area except for the summer.

A little bit about us: I am starting graduate school in Cambridge, MA this fall, so we are also planning to buy multi-family there later this year. My fiance is currently stationed in Florida, so he won't be going anywhere in the next year or two. We are looking into getting VA loans or traditional loans depending on which one allows us to use less of our cash for a single family. We plan to use this opportunity to learn more about real estate. We are okay with paying the mortgage ourselves as long as it is lower than his current rent at least until he decides to move. After that, we hope to sell it for a profit or make it a rental property.

Is there any other neighborhood in Florida that we should take into account?

All suggestions are welcome.

Arianne L. · Answer

@Elena C. You've got some great advice here. If you go like @John Powell's condo idea we've got a 1/1 condo at Cedars for sale right now for 41k :).

Like he said you need to sit down with your significant other and figure out what you want to buy first. VA is a great loan and since he's going to be here for the next 1-2 years that's a perfect option. He can do a live in flip/house hack, combine that with renting out the rooms and that'll make for a great cashflow situation and potential upside with the sale.

There is only one area in the FWB area I won't buy in and that's off of Lovejoy on the west side. Anywhere else varies from A-C neighborhoods but I would live in any of those neighborhoods myself.

Definitely check out the local meetups. I host one every last Tuesday of the month (April 24) in Shalimar and I also attend the local real estate investment guild the next one is April 17 on Okaloosa Island

John Powell · Answer

Welcome to the gulf coast. With the military bases and retirees here there is still a lot going on down here during the off season once you get off of Okaloosa Island and away from Destin. A big thing to think about is how long you think you will live in the area and what kind for life style do you want to live while down here. What kind of rental do you want. Short term or long term. If your looking for something to live in that will break even as a rental or potentially make a profit if sold then a decent 150k-250k single family makes sense. If your looking to rehab there is plenty of that down here. Do you have an idea of what you want your numbers to look like? That will guide your search. If your looking for something cheap you can find 1 bed condos on the intercostal waterway for well under 100k that will rent out well close to Hurlburt AFB. That is what I would do if I were just starting out again. I’d buy a cheap condo and pay it off as fast as I could then keep it as a rental geared towards military members. This would also keep your DTI low for future investments. If you need help finding anything my wife @Cathy Powell is an agent down who invests here with me and understands military life we have been stationed here twice.

Jennifer Wilson · Answer

@Elena C.  Very exciting that you guys are looking to invest here! Like the others have said, it is a great place with a lot of potential and with all the military members in our area, we are fortunate to have a strong rental market.  Fort Walton has some great properties at great prices, but like @Jamin Solomon mentioned, some neighborhoods are what I like to call "transitional neighborhoods" due to new homes located right next to older homes.  If your fiance has the time, I'd recommend that he drive around a bit to determine which neighborhoods he likes and ones he would prefer not to be in.

As I'm sure you're aware, if you go with a VA loan, you will have to intend to occupy the home as your primary residence.  You can do a live-in flip/rehab like what Arianne was mentioning, but you do have to purchase it as your home vs. an investment property.  If you end up moving or getting orders later on and then turning it into a rental, you're good to go!  If this is something you're interested in, then I'd say VA is a good way to go as you can get in for little to nothing down!    Otherwise, my husband and I prefer conventional loans on our investments because we can get rid of the mortgage insurance, but that does require more money down, but it's totally up to you and your financial situation.

If you have the chance to make it to @Arianne L.'s meet up on the last Tuesday of the month, I'd recommend it! It is a great way to meet people and learn how they've worked their investments, and is a small, comfortable environment!  Also, if you or your fiance are interested in taking a look at a few homes, please feel free to reach out to me!  I am a Realtor in the area and my husband and I are also investors with some single family homes and one multi-family complex.  I would be happy to look at the homes with you/him as well as help give an idea on potential ARV and/or rental prices!  :)

Jamin Solomon · Answer

@Elena C. Welcome to Fort Walton. Definitely a lot going on in the summer with Destin and other touristy spots in the area. As far as neighborhoods in Ft Walton, its kind of all over the place. There are many areas where on one side of the road you have a beautiful row of properties and on the other side there's junky mobile homes or really run down houses. Not necessarily a bad thing, especially for an investor who can get the ugly ones and rehab them, but it takes some getting used to. Rents are usually pretty decent for quality properties though so even up to a mid 100k's property should still cash flow. Possibly also look towards the Navarre area.

Elena C. · Answer

Hi Jennifer,

Thanks the information provided! I am currently looking at Zillow for "GREAT" single family or multi-family in the range of $45-90k. We can do up to $30k down payment. We think VA loans are good because we want to save as much of our cash as possible for a larger down payment in the Boston area. Thus, if we can do no downpayment and have the mortgage be at less than what we are currently paying for rent (around $1k), we are good to go. As I said many times before, we want to "house hack" in Florida, so we could learn as much as possible this summer before we go into a bigger deal. I am currently reading The Millionaire Real Estate Investor, still trying to figure out what represents a good deal. Havent done any calc yet. As of now, my investor criteria: a SF or MF with 2+ bedrooms, 2+ bathrooms that needs minor to major cosmetic repairs (we are both engineers, so we are willing to learn to make repairs.) Don't want to deal with structural repairs yet. Good cash flow or flip for a profit (looking to make at least $200 from monthly rent or $25,000 from flip). I haven't studied the market enough to know if those are good or bad criteria. Goal: buy a property by August.

I should be in Florida by June. Will attend the meetups and definitely reach out to you.

Elena C. · Answer

I find condo a bit more complicated to deal with. If I am not mistaken, buying sf or mf give you more control and also access to the lot, so you could add extra and expand if that is what we want. So far, we only plan to buy single family in Florida, improve, sell or rent after he moves. It will give us a platform to gain experience on how to DIY and fix houses. Currently, we are looking at SF in the $40~90k range.

Thanks everyone for the suggestions! We will try to attend one of the local meetups once I am there.

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