All Forum Posts by: Keith Courtney

@Nick Shuber -

I don't find the 5% deposit that objectionable for an escrow deposit on a short term rental vacation home.  On a home priced around $230K, I have seen deposits ranging from $5K to 10% down.  Your escrow deposit will most likely go into the title company's (that will be handling the closing) escrow account.  Your escrow will be returned to you (assuming no unusual factors) if your financing falls through or if you exercise your right to cancel the contract "for any reason" based on your home inspection.  The "for any reason" clause comes from the FAR/BAR contract that is almost always use for Florida residential transactions, so I assume your realtor will be using it.  Your realtor should confirm all of this to you.

Regarding the 10 day time frame on the ordering of the appraisal - I would make sure that your lender knows this.  I personally would make the financial contingency period be based on when you receive final approval or denied - not when the appraisal must be ordered.  The FAR/BAR is written this way.  

Regarding the inspection contingency - As stated above, with the home inspection contingency, you can end the contract for any reason.  You don't even have to get a professionally done home inspection.  This unilateral control is very clearly worded in the FAR/BAR contract.  I would make the home inspection period as long as the seller will accept. This way, if your financing is approved but you decide you don't want to close, your inspection contingency will give you an out.

Good luck with it.

Keith 

@Charles Smith

I can help you with answers to all 3 of your questions.  I need to ask you a few questions to be able to give you specific guidance for your situation.  I will private message you.

Your questions are good ones.  The answers to questions 1 and 2 are critical toward the success of a short term rental investment here in the Orlando area.  Not only is buying in the right area important, but buying the right home in the right area is critical.  Your property manager will take care of your home (cleaning and maintenance) and deal with your renters.  If your property manager fails you, it will hurt your rental income due to the negative reviews left by your unhappy renters.  Your property manager is also critical toward the success of your vacation home investment.  Is it worth the hassles?  I'll send you pro forma statements on the vacation homes that fit your situation, and from them you can decide if it's worth the hassle. I am confident you will think it is.

In the last few months I have seen a significant increase in interest in vacation homes here - both from domestic buyers as well as international buyers.  The good deals are getting harder and harder to find.

Keith

@Logan Allec -

Kissimmee, FL and Davenport, FL are both short term rental friendly cities.  Both cities are just south of Orlando and close to Disney World and our other theme parks.

Keith 

@Dave Anderson

I am very familiar with Emerald Island and its homes.

Regarding the short term rental concern - Emerald Island is a short term rental community as are a lot of communities in the Disney World area.  That will not change.

What I question is the rental income number.  I don't see similar size homes in Emerald Island achieving that $92K number especially homes that have not been upgraded like the one linked in your posting.  I would ask for sales tax records and expense numbers.  

Homes in Emerald Island do have potential to be good investments.  However, any home you buy in there will be a resale and will most likely require upgrading.  Depending on the size of the home, you will probably need to spend at least $30K on upgrades.

Keith

@Account Closed -

Kara - Feel free to contact me regarding a property manager.  I work with an excellent one.  Many property managers require that you let them to do your short term rental marketing, which can be very expensive.  The property manager I use does not require that.

John - If you are possibly considering a short term rental vacation home in the Orlando area around Disney World, feel free to contact me.  I'll guide you toward where I think the best vacation home investment properties are and can provide you with pro forma statements if needed.

Keith

@Dave Carella -

I deal a lot in vacation homes in the Disney area.  There are thousands of short term rental homes - condos, townhouses and single family homes.  Many of them are not profitable, but there are some that are.  As a general rule, the ones that are profitable are ones that are in very close proximity to Disney, are new or have been upgraded, have a good, honest property manager and have a cost effective short term rental marketing program. 
Because most of the new ones are being built a little further out, the success that I witness and am a part of are primarily resales that the new owner upgrades adding a number of amenities that today's vacationers want and that make the vacation home stand out against the competition.  The vacation homes that have been upgraded with the amenities rent for more per night and rent more often - the two most important numbers to drive a profit. 

Keith

Joon -

The HOA fee is $354.84 /month as Bryce Litwin mentioned. The pro forma that I sent to you reflects this amount.

Keith

Tim -

Here in Central Florida in the Disney World area short term rentals are well entrenched, and I don't see that ever changing for a number of reasons - one being the counties where they are located are receiving tremendous tax revenues from them.

I would suggest that you look here for a vacation rental.  Just make sure and do your homework.  There are some good opportunities here, but there a lot that are not good investments.

Keith

Jeff -

I am here in Orlando and deal a lot with short term rentals.  There are property managers here that do not require that they market your property for short term rentals when they manage your home.  Depending on the size and type of your home, they charge anywhere from $150 to $350+/month.  Cleanings are an additional charge.  I advocate to vacation home owners that they use this type of property manager and do their own short term rental marketing - it's not difficult or time consuming.  Then they save the 20-25% that the other property managers charge, which enables them to make a profit.

Keith

Diana -

I suggest you look here in the Orlando/Disney World area.  Primarily because of Disney World, Universal Studios and SeaWorld, our tourism market is year-round.  There are a lot of short term rental vacation homes here, so you will need to be careful to choose a vacation home optimized for rentals and one that is in a prime location.

Keith