Orlando Florida. Is now 18-03-2008 a good Investment Time?

Re: Orlando Florida... Is It A Good Investment Time

It depends on why you are investing?

For buy to let. Most of the numbers dont add up.

Take off tax, mortgage finance, hurricane insurance, property and rental taxes, and you in most cases will get negative cash flow.

Cheap does not always imply good value. We have stuff very cheap, 50% discounted but the numbers dont add up. Be sure you do your accounts if is for investment.

For personal use, it is different. You get alot of house for not much money.
 
Re: Orlando Florida... Is It A Good Investment Time

Martin77 said:
HSBC released additional figures this morning (also reported on CNBC).

1) 5% of their US mortgages are two or more months behind on payments.
2) They see the problems in the US housing market extending into 2009.
3) They also say that it is increasingly likely that the US will enter recession this year.

Number 1 is a shock to me. Under normal circumstances that would be 1 in 20 homes with a mortgage that would be entering foreclosure proceedings. I don't even think HSBC were that aggressive a lender. That'll be a huge brake on any potential upside IMHO.

There's still a long way to go on this story.
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If you think that report is bearish, Credit Suisse projects that by 2012, 12.7% of houses in the United States — roughly 6.5 million homes or ONE IN EIGHT — will have been foreclosed on. A very high percentage of these will obviously be in Florida and California.

http://www.reuters.com/article/bondsNews/idUSN2233380820080422

Sweet baby jeebus, it ain't even halftime yet.
 
Re: Orlando Florida... Is It A Good Investment Time

Indeed it has some way to go yet. Wouldn't buy anything there until I saw some strong evidence of house prices starting to rise ( years maybe? )...and invest in something else for foreseeable future! ( like US stocks ).
 
Re: Orlando Florida... Is It A Good Investment Time

Indeed it has some way to go yet. Wouldn't buy anything there until I saw some strong evidence of house prices starting to rise ( years maybe? )...
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In my opinion you don't have buy at the very bottom of a market, in fact it is impossible for everybody to do this. If one were to buy in Orlando today and prices continued to fall for another while it should not affect me if I am keeping in long term as the prices will eventually bottom and then recover, it is cyclical. I would also say that with a little research you could buy a property now well below even todays level as there are desperate seller there now, when these seller have gotten out or have foreclosed the remaining owners will not be as desperate to sell and so it could be then that prices recover. The bottom line is that there are bargains there now - 2 beds close to the Theme Parks for the same price as apartments in Eastern Europe? I know what I'd prefer.

I don't know if anybody saw the BBC 2 program last night 'The truth about property', its on again tonight @ 8, I though it was interesting and very balanced. They showed a service they now have in Florida where EA's have listings of foreclosed properties and they organise a bus tour around the properties for viewings!
 
Re: Orlando Florida... Is It A Good Investment Time

I just went back to check prices of my old house in FL.

Peak price would have sold for $240,000.

Currently, same model house is listed for $109,000 (would probably accept offer of $95,000)

How much lower can it go?

Either Florida is at the bottom, or prices will eventually fall 75% from their peak.

Scary either way.
 
Re: Orlando Florida... Is It A Good Investment Time

There were some on the ball comments in this thread ! My relative did go on to buy that house and moved in. They are there for the next few years anyway, and accept that the house will go down further but they are in a good area so expect that they will to be able to sell when they need to, in 3-5 years.
 
Re: Orlando Florida... Is It A Good Investment Time

Mumha could you give the name of the area in Orlando they moved into.
 
Re: Orlando Florida... Is It A Good Investment Time

Sorry if I gave that impression (I did say "it is in a very rentable area, in Florida") but he is in Stuart, West Palm Beach.
 
Re: Orlando Florida... Is It A Good Investment Time

SLAPPY said:
Yikes, West Palm expected to drop 17.6 percent in the next year.

http://money.cnn.com/2008/05/06/real_estate/100_forecast.moneymag/index.htm?postversion=2008050817
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My relative ended up buying that house for $220,000 so he is pretty happy with what he got. They needed to move because his wife is pregnant and they wanted a bigger place. Otherwise he would have waited another while. They are in no rush to move again for a number of years.
 
Re: Orlando Florida... Is It A Good Investment Time?

You can find some properties for near $100,000 US, however you may need to do some work to landscaping, furnishings or even the property itself. The reason the property may be priced so low is because it needs work and maybe it is not in one of the better rental communities. So, it also depends on how important renting it to others on holidays is to you financially.
 
Re: Orlando Florida... Is It A Good Investment Time?

If you are buying to rent out some of the time, the problem with assuming that prices are cyclical and will eventually come up again is that while that might be true for the market overall including new houses, there is such a huge supply of land, particularly around Orlando, that capital growth is not certain - even when prices recover. A couple of years ago we looked at buying a villa for short-term rental but it was the year 3 or 4 hurricanes hit Florida so we decided it was too risky. We've been back a few times since and it is amazing the number of new developments that have gone up. And when we look for a villa to rent, we definitely lean towards newer ones - might sound very fussy but would you rather rent a brand-new, newly furnished villa with a sparkling new pool on a new estate with new community facilities (pool, tennis courts, clubhouse etc) or a 10/15 (never mind when it gets to 20/30 years) year old villa that's looking a bit worn? It's not like a Manhattan or central London investment property where there is a very limited supply of land - go for a drive around the rental villa communities around Orlando and you will see how huge an area it is and how much unused land there is. So with a short-term rental property, you may find that demand drops over time as the house/community ages - and the capital growth won't hold up either for similar reasons.
 
Re: Orlando Florida... Is It A Good Investment Time?

And when we look for a villa to rent, we definitely lean towards newer ones - might sound very fussy but would you rather rent a brand-new, newly furnished villa with a sparkling new pool on a new estate with new community facilities (pool, tennis courts, clubhouse etc) or a 10/15 (never mind when it gets to 20/30 years) year old villa that's looking a bit worn?

I agree with some of the points you have made orka but not the above. We have a villa over there about ten years old and are constantly doing it up and upgrading. If anyone is thinking of buying over there one of the most important questions to ask is does the sub-division that I am buying in have a strong home owners association (HOA).
If for example they thought that our villa needed a lick of paint on the outside they would not be long in telling you to do it. If you refused they would get someone to do it and bill you at a later stage. If you refused to pay they would put a lien on the villa and in extreme cases they can sell it from under you to recover any monies owed.
A lot of the newer communities are out on Highway 27, yes the villas are all new and shiny but there is nothing out there.....shops, restaurants etc and miles from Disney. Our villa is located in Lake Berkley on Highway 192 a few minutes from disney and surrounded by shops, restaurants and the likes, very well established. We have a very strong HOA and if you are buying you will not find a blade of grass out of place.
So in finishing, if I was thinking of buying again I would definitely think about buying a resale property on a sub-division that is well established with a strong HOA and the only person who will know of these will be the realtor that you will have showing you around.
 
Re: Orlando Florida... Is It A Good Investment Time?

minkydog said:
if I was thinking of buying again I would definitely think about buying a resale property on a sub-division that is well established with a strong HOA and the only person who will know of these will be the realtor that you will have showing you around.
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And if you are buying to live in or purely for personal use, I agree with you. But as an investor looking to do short-term rentals, it is a lot easier to articulate in a rental ad - 'built in 2006' than 'trust me, it's on a sub-division that is well established with a strong HOA'. And as an investor, when it comes to selling time, it will be the rental record which helps the sale. And yes, a lot of the newer villas are on Highway 27 - we got suckered by the '15 minutes to Disney' (at 2am on a day when all the traffic lights happen to be broken??) blurb the first time we went. But even around Highway 192, there's a lot of land. We stayed at Windsor Hills last time and are looking at Reunion for next time - and there's a lot of spare land and building around even these two so close to Disney. I don't doubt yours is a really nice, well-kept sub-division, I just think as this is an investment property thread, the potential pitfalls of expecting capital growth should be pointed out - and I am fairly impartial as I don't own there.
 
Re: Orlando Florida... Is It A Good Investment Time?

the potential pitfalls of expecting capital growth should be pointed out

At the end of the day its all about location location location, and also the the time you move into this market. We bought ours over fours ago and if we were to sell tomorrow morning we would still make a handsome profit in this depressed market.
At the moment builders are not building on the spare land you talk about (which does exist) and there are bargains to be had after the people who were sold the BS dream about renting out their property for 40-50 weeks a year have left the market.
Dont forget 60 million people visit the central Florida region and mickey every year and in my opinion the STR market has a long way to go before saturation.
As an aside we also bought because we love it over there and not necessarily to turn a quick buck.....we are in it for the long haul.
 
Re: Orlando Florida... Is It A Good Investment Time?

All the foreclosures and difficulties for americans to get mortgages (especially first time home buyers) means that there is a significant increase in the Multifamily (apartment) market especially in emerging areas like Texas. A good place to put your money especially with the strength of the Euro. Not for those looking for a holiday home but heck take the profit and book into a nice hotel in the sun!
 
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Well, three years on it seems that now is an eeeeeven better time to buy in Orlando !

What's the real deal from anyone on here who owns property there rather than the newspaper spin ?

I'm thinking of a recce.
 
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