First time buyer of rental property in miami. Need advice.

[Firas Rabbat]

Hello,

I am here for advice on miami market. I am moving to miami this summer and interested in buying a condo or single family house in Coral gables, pincrest, south miami, downtown or brickell area. I am staying in miami for two years and will move out and rent out the property afterwards. I am mainly looking for all done homes with no need for any type of work due to time constraints.

From what I noticed, there is nothing I can find that will break even or generate positive cash flow if I move out and rent out the place. Is there any advice or recommendation? Should I still buy or just rent for now? should I target condos or single homes? my budget is about a million for a nice place.
Thanks in advance!

[Bradley Sriro]

@Firas Rabbat as @Carlos Rovira mentioned, the Miami market is very difficult to cash flow... especially when it comes to single family. While you may not generate cash flow, all of the areas you mentioned benefit from significant both current and historical upside appreciation. 

I would argue that it would be a much better investment to purchase something for yourself in one of those areas instead of using your capital to pay rent that ultimately benefits only the landlord. You get 0% ROI for paying rent while purchasing will give you several benefits including asset appreciation, principal pay down, and tax benefits/ depreciation.

Once you move out in a couple of years, you can re-evaluate the property to determine if it makes sense to keep it as a rental (in which case you still get all of the above benefits; however, the tenant is now covering the principal pay down), or sell it and capture the potential gains from the property's appreciation. Regardless of which you decide, I believe that your capital will serve you better investing it into an asset instead of using it to pay rent. Hope this helps!