Cape Coral trends for out of state investor

[Avtandil G.]

Hello

I'm looking to buy an investment property in Cape Coral. I'm a buy/hold investor and am focusing on yield rather than flipping/appreciation. Have 2 properties in CA, but am looking to do out of state since can't get desired yields locally any more. I've narrowed down the area to 33914 so far. Would appreciate advise from local investors

* What is renting easier in Cape Coral - a 2/2 condos or 3/2 SFRs?

* I see a fairly wide variance in mo rents in 33914 for a ~1,500sqft 3/2 SFRs, ranging from $1,300 to $1,800 - I'm wondering if the variance could be due to more specific location within 33914 - any advice on which parts of the zip are 'more desirable'?

* How long does it take you on avg to get a new tenant?

* Do you see any noticeable slow-down in sales and discounting?

* Are there any credible (and largish) local property management companies you'd recommend that have 50% first mo + 10% / mo rather than 100% first mo + 10% / mo fee structure?

Thanks

-A

[Peter Davis]

Hi Avtandil,

33914 is a desirable zip code, nice homes, good access to the gulf, nice local amenities like Cape Harbor, Tarpon Point, among others.

Seasonally, both condos and SFR's are in huge demand; there's very little available. Annual rentals are also in demand although the fast rise in rents over the past couple years has pushed a lot of local renters out of the area, to Lehigh Acres for example, where rents are less.

Condos can be trickier to rent because many condo communities have restrictions on rentals, i.e.: length of rental term, number per year, approval from the HOA, pets, etc. Whereas with a SFR you can do whatever you want. Finding a quality tenant won't be a problem, supply and demand. Do your checks and you'll find a good renter, whether seasonal or annual.

The variance in rents you're seeing in 33914 likely depends on several factors, including specific neighborhoods where some may be nicer than others, i.e.: a home surrounded by newer gulf access homes is more desirable than a home in an older neighborhood off-water (no canals).  Also, naturally the age, condition, finishes and amenities (pool, fenced yard, etc.) are a factor that will cause the rent variation you're seeing. 

Sales have slowed slightly from last year but prices continue to rise, in part due to lower inventory.  I've seen a recent uptick in activity as buyers are beginning to arrive.  I was showing homes to two separate out-of-state buyers over the last two weeks and both are now under contract, one on a gulf access home in the SW Cape and the other on a nice pool home in the SE Cape.  I think it will be an active season.  In fact, as I'm out showing homes, I occasionally see what I think are interesting investment opportunities.  I saw two such homes recently and plan to shoot them out to the BP nation in a separate post.

Hope this helps Avtandil!

Sales have slowed down slightly from last year but prices continue to rise, for SFR anyway.  As we're coming into season I'm seeing an uptick in buyers.  I think it will be an active winter.  I had two different buyers in town over the last two weeks and both are now under contract, one gulf access in the NW Cape and the other a nice 3/2 pool home in the SE Cape.  In fact, as I'm out showing homes I occasionally see what I think are interesting investment opportunities.  I saw a couple homes recently that I want to bring to the attention of the BP crowd. I'll do that in a separate post.