Help analyze this Cape Coral, FL New Construction (Buy and Hold)

[Andrew Craswell]

Anyone have in depth knowledge of the Florida and Cape Coral markets? I had been planning to buy my first property to get my feet wet and was looking for an easier turnkey property, but I came across an interesting new construction deal where the lender was offering just 10% down. The numbers aren't amazing, but seems Cape Coral (33993) area might have a decent chance at an equity play with higher than normal appreciation values which may be a bonus. Few other advantages I see:

• New construction should mean less hassle and lower expenses which may be more suitable for a first property
• The house costs $220k and the lot is just $10k, so depreciation should provide a great tax write-off
• I actually love Florida and wouldn't mind visiting when the place is vacant
• 10% down makes the CoC rate pretty decent, and unlocks a lot higher value property

I'd be happy to pay a consulting fee to connect to someone in the area who could help advise on this, or help think through any Florida specifics since the market is new to me.

I suspect the cash flow in this example proforma is inflated. I'm assuming the rent value would come in closer to the lower end of the deal, especially if Covid is still raging. First year owning the property probably wouldn't be great performance. I suspect the vacancy rate is also closer to 7%, as this is something I read in a few articles from last year.

A few other things I'm doing:

• Scheduling a meeting with a property manager to get their opinion on the property and get a sense for what they might price the rental value at. I'm also interested in property management recommendations.
• Scheduled a meeting with a CPA in in my area that is active on BP and came highly recommended from other investors. Hoping to plan our LLC structure and get a sense for Florida specific issues, taxes related to new construction, and how to plan ahead for when I own 3, 5, or 10 properties.