STR in Orlando and Kissimmee area

[Steven Cheung]

Hi everyone, 

I've been interested in getting a STR property in Florida. I really want to know the rentability in Kissimmee area since its super close to all the Disney attractions. As I am an out of state investor It is tough to truly know the area. But does anyone have experience with being an investor in this area?

It seems that rents are around 250 a night for 4 bedroom townhomes. There seems to also be a lot of competition and majority of these townhomes are investor owned. 

When doing the research at 10% down for a 400k to 500k townhome and given HOA, taxes, and other things the occupancy rate must at least be 70 percent to make this even worth it unless I'd be barely breaking even. Unless someone can tell me its normal to rent >70% occupancy? seems like a lot of risk for low reward.

Anyone have some advice in this area?

[Ryan Moyer]

> 70% is definitely doable, but probably not at the rates you're hoping for.  Rates have been trending down in the area since the covid boost finally started to level off, while home prices have not.  It's a great market long term, but that's kind of the rub right now. 

I do > 90% on the one I own but it is heavily themed.  Theming is the key here.  There is an unlimited supply of nice homes and that leaves nothing to compete against each other with than price.  I have a client that had a hard time accepting  that his 6br home might rent for under $300/nt at times.  It took showing him that there are 9br homes in the area renting for sub $200/nt from some desperate owners to drive the point home.

It's a vacation destination which means it will always be a strong STR market. But you need to mentally prepare yourself to possibly not cash flow for a while if you're not very well themed.