All Forum Posts by: Dillon Cook

 PM companies don't make their money from a subscription service at $35-50/mo.  The costs associated with that are usually very high.  Remember these are 3rd parties who PMs partner with to provide the subscription package.  A PM may get $1-5/mo per door.  Most of the profit goes to the 3rd party 

Well that's definitely not normal. Either they have a massive portfolio to make such a demand, or they'll quickly find the worst PM or not one at all.  @Michael Smythe  @Mitchell Hammack

I'm not a property manager myself, but work on the brokerage side.  But I see and hear everything.  Some PMs are offering hundreds off first months rent.  I've never thought those worked very well.  I think a cheaper and psychologically more effective advert is 5% off your monthly rent if apply by "this date".  People don't want an upfront discount.  They want to better their lifestyle and a one-off discount is perceived as temporary and lesser. IMO

@Michael Smythe

9% is the average in Tampa.  I've worked at multiple PMs in the area for the last decade.  Any local questions you have, hit me up.

75-100% first months rent is average.  I've worked with some PMs who don't even charge a renewal fee.  You DO get what you pay for, but also recognize that some people aren't worth what they charge.

It's definitely slower.  I am wondering if there are more people moving out of Florida now which solves some of the demand issue.  Less at-home/remote jobs.  Population growth during the pandemic HAD to be a little elastic, meaning not everyone would stay.

You can't get a distressed house or duplex in tampa under 150k.  Maybe a 1 bed bungalow in a bad part of town. 

You're saying it costs 600k to build a 1.5m property?  Are you sure it's really 600k?

@Account Closed as an investor focused realtor, that's what I think as well. 

While I think there's still a strong case for appreciation in some markets, I've somewhat pivoted away from long term rentals for the time being as most investors don't want to put more than 25% down (understandably).  Cash investors don't care.  

There are other rental strategies that are producing cash flow - like Padsplit - for the real estate on the side.

@Jorge Vazquez

Interesting take. I think a massive amount of people have a second job already, and that's not necessarily a good sign.

As for the 1% rule, I can actually find them occasionally, but it's a bit deceiving. I'm curious how you would calculate cash flow because from the conservative calculations, 1% rule doesn't cash flow. Our property taxes and insurance are too high.

I do have hope for 2024, but are your investors cash buyers or leveraging ~20% down and seeing any cash flow?

In the Tampa Bay real estate market, achieving positive cash flow from long-term rentals is quite the puzzle this year. With rising interest rates and property insurance costs outpacing rent and wage increases, investors are feeling the pinch. Making hefty down payments (30-40%) to get a trickle of cash flow works. But is this sustainable, especially with the potential of a recession? And what about the long game, banking on good deals now and then cash out refinancing when interest rates dip?  Anyone seeing something different in a nearby market?

It does seem Tampa's market remains attractive to investors, with around 26% of closings coming from investors.