Investment opportunities in Florida real estate

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September 22, 2013

Investment Property Ideas




Investment opportunities in Florida real estate market. This investment opportunity lies in Lake Fredrica, Orlando. This residential development is located 10 minutes south-east of downtown Orlando in a suburban location and is tenanted by professionals, whilst also being just 10 minutes to Orlando International Airport and 15 minutes to the Orlando convention Centre. This is an excellent opportunity to invest in the greater Orlando real estate market. As prices of short-term rental accommodation, e.g. villas, have risen, and their supply has increased, it is becoming both expensive and difficult to invest in the area in this way and make the numbers stack up. Prices of short-term rental accommodation are falling in the short term in many parts of the central Florida area.

The demand in the area has been fuelled by the 75 million (and increasing) tourists travelling there every year and the associated commerce that it creates. However, unlike these “holiday let” properties, long term residential properties have hardly increased in value over the last three years and the potential to increase is astronomic. We recommend investors turn their attention to this long-term rental market as this is where the best returns can now be made. This means you are investing in suburban Greater Orlando, in a conventional buy to let.

Investment opportunities in Florida real estate in Orlando

Investment opportunities in Florida real estate1 Bedroom Superior Apartment $155,000 (£83,000)
1 Bedroom Superior Lake View Apartment $175,000 (£94,000)
These apartments are currently occupied by American citizens on long-term lets
All 1st & 2nd year costs paid by the developer, including mortgage costs and management costs – up to a maximum of $1,400 (£753) per month
On-going rentals of $1,100 – $1,250 p.m. should exceed all maintenance & repayment mortgage costs, post refurbishment
All closing costs paid, i.e. legal costs & disbursements
Offered at a discount to market value of over $10,000
$1,000 to make a reservation (refundable before exchange of contracts)

Typical return on investment
Purchase price     $155,000
Reservation, deposit & fees     $31,000
7.2% equity growth year 1     $11,160
7.2% equity growth year 2     $11,964
7.2% equity growth year 3     $12,825
7.2% equity growth year 4     $13,748
Return on investment = 160%     $49,697

* This example assumes the client takes a mortgage for 80% of the property value on completion and keeps for 2 years after the rental guarantee expires.

Investment opportunities in Florida real estate – property amenities: views of and direct frontage on Lake Fredrica, fishing pier, two swimming pools, boating slips, waterfront gazebos, heated Spa, State-Of-The-Art Fitness Centre, picnic area, car wash facility, covered parking with storage. Deposit of 20% payable within 30 days ($31,000, £16,600); 75%-80% stated income or 80% full status finance available,  Example repayment mortgage costs of $896 (£482) and $1,012 (£544) per month, apartments undergoing refurbishment, work is scheduled to complete fall 2013.

The simple fact is that the demand for long term rentals greatly outstrips supply. The reason is that thousands of people every week are moving permanently to Florida; most of that focus is around the Orlando and central Florida region – there is not enough rental accommodation to meet the long term renter’s demand. These apartments on Lake Fredrica are let to American citizens on long-term lets and are undergoing refurbishment, scheduled to complete in 2014 – hence they form part of the current Orlando supply inventory. The residential investment opportunities in Florida real estate offers an incredible investment opportunity over the short term and up to 10 years.

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