ORLANDO — The cost of purchasing an investment property can go well beyond simply the price of the home itself. Anyone interested in buying a home as an investment should first consider the many factors that go into maintaining it, renting it, and keeping it viable in a competitive market.
An Flamand, the owner and broker at An Flamand-Orlando Vacation Realty, is an expert in investment sales. As is the case with first-time home buyers, An noted, there are a lot of costs associated with owning a home that need to be factored into the early decision-making process.
For example, maintaining the home in good condition is critical for both first-time buyers and investors. Both want to ensure that the property stays clean, attractive and free of problems.
Even a home that’s brand new will eventually suffer from wear and tear – everything from leaky pipes to an aging air conditioning unit.
For investors who choose to rent their property on either a short or long-term basis, keeping up the property’s condition and avoiding any unpleasant problems for renters is crucial.
This is true for another aspect of home maintenance: keeping the pests out. That’s not a reference to problematic tenants (although investors will definitely want to keep them out, too), but to the many insects – from termites to ants to roaches – that can breed inside a home. Taking the time to have an independent pest inspection done is essential before turning the keys over to renters.
Those investors who choose to make their properties available as short term rentals can quickly discover they’ve made a smart move. Central Florida is home to some of the world’s most popular theme parks and is close to the beaches, and in the past decade, vacation homes have become an appealing alternative for tourists, especially large families that want the comfort of staying in a fully furnished house, with a kitchen, living room, and multiple bedrooms, rather than cram everyone into a hotel room.
There are also some costs associated with this decision. First, a furnished home means the investor should seek out quality furniture and amenities that will make the property appealing to guests. Furnishing a kitchen, dining room, game room, and separate bedrooms for adults and children requires plenty of thoughtful decisions and selections. A real estate agent who specializes in the investment market can help guide the investor to the best companies in the field of home décor.
Investors should also consider the importance of scheduling regular home inspections, which can help ensure that the property is well maintained after each guest has departed.
Other costs to consider include how much to spend on utilities – everything from providing a heated pool to outdoor lighting to the best possible air conditioning system – and whether to buy a property located in a gated community that has a great reputation, but also has a homeowners association that requires monthly fees.
Also important to consider are property appraisal fees, closing costs, property taxes, homeowners insurance, and mortgage rates. A real estate investment broker, An noted, can help guide the buyer through all of these expenses.
More importantly, An Flamand fully understands the entire process of investing in income rental property – and the hidden costs sometimes associated with the purchase.
Orlando Real Estate Broker An Flamand can also work with investors to help them generate the optimal income return on their short or long-term rental property. That includes helping them put together a strategic rental plan.
Orlando Vacation Realty is an excellent place to start researching how to turn the purchase of a home in Central Florida into the smartest investment you’ve ever made.
So take a moment to consider these 11 tips:
1. Develop a strategy for your rental property.
2. Set a budget and plan for repair work to the home.
3. Conduct a pest inspection early on.
4. Conduct home inspections early on.
5. Consider the amenities you want in the home.
6. Get the property valued by a real estate appraiser.
7. Budget for closing costs.
8. Budget for moving fees.
9. Budget for homeowners insurance and property taxes.
10. Consider additional insurance for potential risks like flooding.
11. Budget for utilities.
Michael Freeman is an Orlando journalist, playwright and author of the book “Bloody Rabbit”. Contact him at Freelineorlando@gmail.com..