How is the Orlando Real Estate market looking right now?

[Vin Gupta]

I'm looking to invest in the Orlando Real Estate. How is the market looking right now? I've seen a lot people worry about the cost of insurance.  

[Chris Grenzig]

@Vin Gupta Shawn is right and he's probably one of your best resources on BP for the Orlando area. From a rental perspective things are definitely taking a bit longer to rent and it's becoming more common to see concessions than 1-3 years ago. Insurance premium relief is trickling back into Florida, as Shawn said, but it's not widespread yet. Rental rates are pretty flat in the Orlando area, and vacancy has expanded and you'll see rates in the 7-10% range, but it just depends on what source you get it from. 

The "good news" is I think there are some tailwinds behind rental properties coming int he next 1-4 years. There has been a ton of new construction all over Florida, so supply and demand tipped very quickly in 2022-today. However, new construction starts have plummeted since 2022/2023, so within the next 1-3 years current projects that were started in 2022 will finish up, but the pipeline of projects that started in 22/23 is way smaller so projects being completed in 2025-2028 will be significantly less so supply and demand should tip back (all else being equal). I've seen some reports saying new supply for that 2025-2028 range will drop below the levels of 2015-2018 in many markets in FL but I don't have actual sources and changes in different markets and areas. 

I think the combination of fed cuts, insurance carriers slowly coming back, population/job growth being steady, future new supply dropping off, and a few other things bode well for rental properties in the coming years. So if you can find deals that work well today, I think they have a good chance to perform really well in a few years, it's just tough to find those opportunities in FL today. 

I say this both as a property manager and also as someone who owns 51 MF units too.