Property investors/renters ! step on in

nxhappy

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hey guys....I have a chunk of money I want to invest in a cheap house. I am thinking about Florida (possibly Pensacola). Problem is....I live in CA...Am I crazy for thinking about this? Does any one own a home thousands of miles away ? I am looking at current markets, and charts are showing 10-12% . I could even rent it out to vacationers a few weeks at a time. Tell me to do it LOL .... or maybe it's a bad idea.
 

Serpent

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Its a good idea. I talked to a Fidelity consultant about opening an LLC for putting a home up for rent.
Also, now considering using that LLC to register my car since paying $600+/year for registration ****ing sucks, will prob have to smog in 2-3 years too. Registering car out of state will solve that shit!
 

nxhappy

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Its a good idea. I talked to a Fidelity consultant about opening an LLC for putting a home up for rent.
Also, now considering using that LLC to register my car since paying $600+/year for registration ****ing sucks, will prob have to smog in 2-3 years too. Registering car out of state will solve that shit!
damn. I totally forgot about that LOL . So what your saying is......twin turbo in Kali without smog ?!
 

venmos1

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I dont have a lot to contribute aside from the vacationer looking for a rental. My wife and i just spent hours and hours looking for a rental home for vacation. We already bought our tickets into orlando and narrowed our search to 3 hours in any direction, preferrably on the gulf. There were a lot of options at all sorts of price points. We were amazed at some of the very high end homes for rent for only 150 and less a night. Some had to be half to million dollar houses. So it seems that competition is high. These all had enclosed pools with 3 plus bedrooms and 2 bedrooms sleeping 8.

What i would take out of this is what is true with any real estate transaction. If you buy the property at the right price you cannot lose. If you buy too high you set yourself up for failure. Sounds kinda obvious but it really is true. Supply and demand. If you offer what people want at a price they want to pay you will be fine. Pay too much for a property and sink too much into renovations to stay up to other comps and you may be in trouble. I would guess that a lot of these homes were either purchased at killer prices or were hand me downs as it seems like they barely make enough to pay the taxes, rental fees, insurances, landscapers, property managers etc. You really need to be on point with your numbers if you want to make profits. But thats just the basics of real estate.
 

Klaus

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If I was in your situation, I would ask myself the following:
- What % of your net worth would this represent?
- How much of net worth is liquid?
- What life events are on the horizon?
- What is your time horizon?
- What are your goals for the investment?
- What do you mean by "charts are saying 10-12%?"

All in all, houses are terrible investments. If you want to own a house that is one thing. If you actually want to invest your money and generate a return on your capital look elsewhere. A simple S&P index fund is a good choice.
 

BlckBox04

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OP what do you actually plan on doing with the house? If it's going to be your vacation get away and you can afford the yearly upkeep I think it's a no brainer.
 

DSG2003Mach1

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damn. I totally forgot about that LOL . So what your saying is......twin turbo in Kali without smog ?!

until you drive past one of those mobile smog stations and then they'll probably still try to cut your nuts off

also make sure to see what insurance and stuff would look like, especially if close to the water. Hurricane deductibles are a mother ****er too so be aware of that
 

nxhappy

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I consider myself a decent businessman. 99% of the time I make profits. Not to brag but I am tight ass lol. If I purchase a house it's going to be under what I think is market value. It would mainly be a vacation home. BUT if I could rent it out when not in use, that would be cherry.
 

HillbillyHotRod

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Did that, doing that. I had houses in cali for like 15 years while I was all over the US. a MUST have is a good management company that can keep tabs on it. It cost me 10% for that but well worth if for not having the headaches of dealing with it. That was like 1500 miles away. Recently exchanged that for a condo in Gulf Shores, Al so it is only 750 miles away. Plan on using if of and on and get to write of the expenses of doing so.
 

nxhappy

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OP what do you actually plan on doing with the house? If it's going to be your vacation get away and you can afford the yearly upkeep I think it's a no brainer.

use maybe 2-3 times a year for vacation. Also just as investment. The FL housing prices are so damn cheap it's unbelievable. I'm in CA so we get butt****ed on everything, I'm used to triple pricing lol.
 

BlckBox04

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use maybe 2-3 times a year for vacation. Also just as investment. The FL housing prices are so damn cheap it's unbelievable. I'm in CA so we get butt****ed on everything, I'm used to triple pricing lol.

Dude I'm in NJ, we're practically the same state. I know EXACTLY what you're talking about lol
Buy something in an affordable and affluent area and you should do just fine.
 

nxhappy

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until you drive past one of those mobile smog stations and then they'll probably still try to cut your nuts off

also make sure to see what insurance and stuff would look like, especially if close to the water. Hurricane deductibles are a mother ****er too so be aware of that

roughly how much is yearly home insurance in FL ?
 

DSG2003Mach1

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roughly how much is yearly home insurance in FL ?

I don't think up there is going to be comparable to me in the middle of the state, dont know how close you are to the coast or anything else. I think my premium here in CFL is about 1% of the value. Hurricane deductibles are something like 5% of the value of the home.
 

barstowpo

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Have you checked with any vacation rental agents in the area. If the house is going to be only used a few times a year, I would look into some sort of management company. One that also deals with vacation rentals would be ideal. They could also manage the repairs and maintenance needed.
 

nxhappy

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I would expect Fl to have high property taxes since they do not have income tax.
I live in CA, I'm used to paying quadruple for anything and everything LOL. No joke. I have seen the Florida housing prices and they are amazing. The only thing you have to watch out for is hidden HOA fees, some places are $600/month just for the damn HOA.
 

HillbillyHotRod

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I live in CA, I'm used to paying quadruple for anything and everything LOL. No joke. I have seen the Florida housing prices and they are amazing. The only thing you have to watch out for is hidden HOA fees, some places are $600/month just for the damn HOA.

That is what we are paying. That does include all common maintenance and property insurance. You have have your interior insurance but is not that much. Anyway this is Alabama but would guess most states are similar. Upside 2/2 averages 30k a year.
 

PhoenixM3

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We had good success managing SOCAL property while we lived overseas. Thorough tenant screening, and having a trusty handyman is key. If you can’t make a few hundred dollars per property then consider other investments.
 

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