Vacation rentals in FL

[Amy Ranae]

Hey Y'all,

My fam used to have a house in Rosemary Beach, FL and we would vacation there all the time. A few years ago, they sold it so we haven't been back since. This year, I rented an AirBnB there and we are going down for a fun little vacay in a few weeks. This has gotten me thinking about owning something in the area. So....

...Tell me about your experience with owning a vacation rental on/near the beach. What are your purchase criteria? How is it different than a normal rental? Do you have management horror stories? Do you know any good agents in the Rosemary Beach area I should connect with while I'm down there? Pros/cons on owning a rental from a distance.

Maybe I should just keep renting when it comes to a vacay house, I'm undecided but appreciate your feedback! 

Thanks BP Friends! 

[Luke Carl]

Don’t let Paul scare you Lol.

There’s big money to be made in this business in the RIGHT MARKET. First thing to do is check if the area is vacation rental friendly. If you saw several AirBnB’s in the area it probably is but again quick google search.
Next.... run the numbers. If you’re dealing with condos on the water the returns are generally small if anything. The HOA will be high and the terms on your loan will be outrageous because you can’t get a conventional. If you pay cash you’ll avoid the high dollar loan and make money.

I would start by messaging the owner of the place you have already rented and ask questions. If they actually own it (which is not likely) they will probably be more than happy to answer questions!

There are some money maker markets in Florida and others where you’ll be struggling to tread water.

I do want to point out that if you go and stay there, you lose money, and is that really any different than spending money?

The dream of having a place to go stay in is not realistic because whether you’re staying in your own place or renting someone else’s it still costs you the same amount. However, it’s the difference between spending $xyz of the money you make now and $xyz of your future income so it’s a good problem to have.
If you’re barely breaking even every month you’ll feel like a chump sleeping in your own house having created a new job for yourself that Costs you money!

In my market a 250k 2 bedroom will gross 40-50k per year depending on who’s managing. Then again if you don’t self manage in my market you lose money because PMs charge 40%
I self manage 5 cabins in the mountains from 10 hours away and I do 90% of the work from the can in the morning. I also have a day job and I’m a moron.

Ask a Ton of questions and you shall find answers.
Good luck!