Anyone own a vacation home?

[tyco]

I was just curious if anyone could give me some details about vacation home (owning in Orlando/area) I see these beautiful homes and hear such good things about them - Wise investment or not comes to mind - We always end up in Orlando for vacation no matter how many other areas we look into - We love it there - Like so many of you do! It would be great to own and have a roomy place to stay when we're down there - Thanks guys (as always)

Sue

 

[disneysteve]

Hi Sue. You are among thousands of us who have had the exact same thought. We go to Disney every year. We rent these beautiful homes. Why not buy one and do the same thing?

The simple answer is - Its not that easy.

Owning a rental home near Disney is not a slam-dunk proposition. Last year, my cousin and I spent several months studying the local market, speaking with owners and property management companies and chatting at online forums. The owners who are successful (i.e. making a profit) all said the same thing. They spend several hours EVERY DAY handling house business, advertising, booking reservations, responding to e-mails, communicating with their management company, etc. It may not be a full time job, but its at least a substantial part-time one. If you think you can just buy a house, hire a management company and sit back and collect the rent checks, forget about it.

There is an excellent online forum devoted to this topic. Many owners post there and will be happy to answer your questions. The site is:
http://www.orlando-guide.info/forums/default.asp

By the way, after extensive research, I remain a non-owner. The housing prices in the area have risen rapidly at the same time the supply of rental homes has also grown tremendously. So you would be buying a more expensive home with more competition than ever before. That makes it even harder to operate successfully from a business standpoint. So do your homework and if you decide to buy, be absolutely sure that you can comfortably afford ALL expenses associated with the house WITHOUT any rental income. If you need rental income to afford it, don't buy.

 

[tyco]

Steve,

First let me say thanks for the response and the info/web-site - I hear you loud and clear - My husband and I are looking to purchase some type of investment property - We will probably stay closer to home - I just thought looking into Orlando would be an interesting idea - I have been doing some (small amount) of research and I'm seeing the amount of homes and the price are both LARGE to say the least! I agree with you 100% - We will do more research and see - We were also looking Jersey shore $$$$ - It seems that we like the expensive areas - Oh well, doesn't everyone? Thanks again!

Happy trip planning!

Sue

 

[disneysteve]

Originally posted by tyco
We were also looking Jersey shore $$$$ - It seems that we like the expensive areas

Even though Jersey shore prices are quite high as well, that is the better investment for a number of reasons.

1. Competition - there aren't nearly as many rental homes in the most desirable areas as there are near Disney. In Kissimmee, there are literally thousands of homes within 20 minutes of WDW. There are a very limited number of homes however within a block of the beach in Sea Isle, for example.

2. Proximity - I don't know what part of PA you are in, but wherever it is, you are closer to Jersey than to Florida. You can take a weekend drive and check on the house, do maintenance, etc. Its much harder to be a landlord from 1200 miles away.

3. Rental fees - 4 bedroom homes near Disney go for as little as $100 per nite, sometimes even less. Due to the relative scarcity of homes at the shore, rental fees are higher which helps offset the costs.

4. Rental duration - lots of folks rent shore homes for the season. Granted, the season is only 8 or 10 weeks, but you can take in more than enough during those 10 weeks to cover your costs for the year. In FL, you need to rent your house for somewhere in the neighborhood of 30 weeks to break even (depending on various factors).

Maybe one of these days we'll actually enter the investment real estate market but it won't be near Disney unfortunately. Happy hunting.

 

[Amirah95]

We considered purchasing a vacation home, but after our lawyer ran down the list of responsibilities and the finances...we were obviously not ready or prepared to do it. It's a business that has to be kept up from long distances (ouch) and we have one of those already that we work many hours in and plus we have regular jobs. My DH said that the hardest part is getting the bookings to fill up the entire year to breakeven.

I agree with DisneySteve, do your research.

 

[tednvon]

Hello,

Could not agree more with the above posts. We purchsed a 7 bedroom 6 bath in Emerald Island 8 months after 9/11. It was one of the first 7 bedrooms in the area and rented very very well. Prices skyrocketed, and now there are over 100 7 bedroom homes in the area and more coming, so rentals became harder to get and we did lots of "specials."

We sold the home 10 months after it was completed (took 8 months to build) and did very well. But now instead of purchsing a 7 bedroom home for just over $300,000 with 20% down and rentals at $280/day for about 220 days a year, these homes are 500 to 800,000 fully furnished and ready to rent and the rents have not changed. So profit is very hard to do and how much they will continue to appreciate is a good question.

Prices continue to skyrocket with 3-4 bedroom homes now 200 to 400,000 and new condos CLOSE TO DISNEY going for 200 to 300,000.

Investment now is for appreciation unless you can pay 50 to 100% down.

If you are from England, $500,000 is really about $300,000 so the Brits are buying a lot of real estate in the area.

As said earlier, we did 2 years of homework and watching the rental market. 9/11 caused a huge slowdown in traffic and we were given over 20,000 cash as an incentive to buy the house.
Now there is not much in terms of incentives from sellers.

I spent about 45 minutes a night answering emails from our websites. We still rent the home in Iowa to friends and the new owner provides us with a little commission.

I loved the contact with the renters. They were usually big families coming for a reunion and vacation of a lifetime and seeing them have a great vacation was lots of fun for us.

Any specific questions, feel free to do a PM. Our website is www.7bedroomorlando.com
Hope this helps.....don't do it unless you love lots of problem solving and time on the computer....

All the best....Ted