Anyone out there ever bought a house in Florida?!

[Debs Hill]

We are considering buying a house in Orlando and I would love to hear from anyone who has done this! How easy was it, what did it cost, do you rent it out etc? Also, once you have a propery in Florida can you retire there, or do you still need visas etc?
Thanks for your help!

 

[vernon]

Hi Debs, you still need a visa. A lot of people will spend 6 months ( well a day less than 6 months is the current rule) in Florida and 6 months in Europe. I bought my house 5 years ago for £90,000 and sold it last year for £110,000 but by the time the agents fees and taxes came off in $ terms I didn't make a profit, in £ terms a small profit because of the exchange movement but that was more than eaten up in the running costs.
Buying the house was pretty easy, the agent I dealt with was very good and very prompt in keeping me up to date on developments. Renting out can be quite time consuming and unless you have a very large circle of friends quite difficult to get enough rentals to hit breakeven. Getting a good local agent is an absolute must, but again not always easy to do. My experience was the agents got me about 25 weeks a year of bookings, you need probably 40 weeks a year to break even so you need personally to get something like 12-15 weeks a year yourself. This can be easier if you don't vacation at "prime time" yourself. In my case I would personally use 3 or 4 weeks of time that would certainly have produced income had I not been in the house myself (i.e Xmas, Easter and July/August). Obviously, the less you have to borrow in order to buy the house, the easier the finances are to justify.

From an investment point of view, there are a few things that need to change that would REALLY help to boost prices.
1) Is that the envoirenmentalists pressure the Fl government to cut back on the amount of land they are allowing to be developed. I think this WILL happen, but it could take quite a few years. With less land becoming available, there will be fewer new homes coming onto the market. With demand outstripping supply you should, IMHO see quite a sharp rise in house prices if/when this comes about but it could take 30-40 years.
2) More "baby boomers" quit the chilly northern affluent cities and retire to the warmer south. It seems that Arizona is the #1 destination at the moment for this group of people due to the less humid but still warm weather. But Florida is still a pretty popular destination.
3) If more Americans start looking at Home rentals as a accommodation choice. I couldn't ( still can't) believe how few American look at this option when going on vacation. They will rent a house at the beach or on a lake, but don't consider it on a WDW vacation. I do think 9/11 will have an effect on the way Americans vacation with fewer people taking " 4 or 5 weekend breaks" and more choosing for less but longer breaks. This makes Villas a much more attractive choice. Coupled with more people choosing to drive instead of flying means the benefits of "on site" are a little less obvious.

I spent 3 or 4 years thinking it over before I took the plunge and even though a divorce meant I was unable to keep the house I don't regret the choice. It's likely that I will move to America in the future, which was the main reason for me taking the plunge int he first place, but on one income supporting two household it was just a little too expensive a luxury.

If I had only been looking at the matter as a holiday destination, I think I would have gone down the road of either a timeshare or DVC as a much cheaper and less demanding commitment. While it is likely that rentals will help towards the upkeep, it is by no means guaranteed that they will. Events like 9/11 can really blow a hole in your plans and if it's a tight call financially you need to be aware that it is possible you would go a long stretch where you had to fund the upkeep yourself with few or no rentals to help. In those circumstances it's likely that there would be many homes up for sale as owners "cut their losses" it would be a difficult time to unwind a loss making investment and likely to be a costly one.

 

[Sue F UK]

Hi Debs,

I agree with Vernon. We bought our home in Florida last year and, while we don't regret it, we found ourselves on a very steep learning curve.

There is much, much more involved in buying than the realtors (estate agents) would have you believe and rental income is by no means guaranteed.

You can get a US mortgage with a deposit of as little as 20% with few questions asked - it is staggeringly easy!! But beware, as vernon says, the bokings from agents will never be able to cover all your mortgage and maintenence costs. This means you will have to learn to market the house yourself or find the money to make up the short fall. The competition is tough with thousands of properties available for rental in the kissimmee area alone.

Before you take the plunge you need to do as much research as you can. Questions you may need to ask yourself are:
Do you want a personal home you can just spend a couple of weeks a year in and nothing else or are you prepared to run the home as a business with many other families using it too?
Do you have the time and skills to spend marketing the property yourself?
Can you afford to support the home if the rentals do not live up to expectations?
Do you expect to make a profit on the sale of the home or are you happy to just break even?

Sorry, I really am not trying to put you off but have learned from experience that there are many people in Florida who are just interested in getting you to buy a new house and don't really care if you can afford it or not. They promise you that the house will pay for itself when in reality this may not happen.

If you decide that buying a home is for you then you need to look into the options available.
1) You can have a home built for you. This will take approx. 6 months and developments tend to be out on the Highway 27 (12-15 miles from Disney) You choose the plot, the basic type of home and then add the pool, furniture package on top.
The price depends on the type of home, plot location, number of bedrooms and pool/furniture packages chosen.

2) You can buy a 're-sale' home which is what we did. These are slightly older homes (ours is 2 years old) which have been sold by the owner for one reason or another. These are sold 'as is' much like in the UK. They come fully furnished - right down to the teaspoons and you can start letting the property from day 1 after closing the sale. Re-sale homes are available all over and can every realtor has a list of every home available so you don't need to shop around too much.

The list of properties available can be viewed online at www.realtor.com just put in the town and it will list all properties for sale and their prices. This should give you a good idea of what's available in the re-sale market.

So far we have managed to break even with our villa and love having it, although the amount of work we have put in to 'break even' defies belief!!

If you would like to send me a PM I would be happy to answer any specific questions.

 

[Beth__WDW23/6/02]

Hiya we are in the same predicament.
We are interested in "buying a home" over in america,and plan to stay 6months here and 6months there.

Ive been on a few websites,looking at prices,and etc.
Just wondered what do you do? how do you get the ball rolling?
We have 20 - 30% of the asking price which i understand you have to put down? but i just wondered where do you start.?

Any advice i'd gratefully welcome,as we are waying up the options.

Beth x

 

[FLeisure]

This really is a thread that needs a book !

A lot of good advice is listed here but basically do a lot of research and make sure you buy a home that is in the right area from both a licensing and rental point of view.

It is possible to make a house break even but YOU must be prepared to put a lot of effort into it. If you are in the financial situation whereby the house MUST pay for itself.....don't do it !

As regards moving out here....very difficult. My parents hold a B visa which entitles them to a 6 mth stay. Even this, however, is down to the immigration officer at the time of entry. EG., we recently went on a cruise and the immigration officer told them that if they left the country for a month, he'd allow them back in for another 6 mths ! Another immigration officer would have his own interpretation no doubt !

In short, take your time in coming to a decision. I spent the best part of a year researching the possibilities of buying a home and I went into it with my eyes open. I now live here so I can only say I got it right but it was still a steep learning curve.

Good luck with whatever you decide.