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Best places to invest in Orlando Real Estate

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Often, investors come to us when they have already bought a property they plan to rent. They are proud of the property they purchased and they think it’s going to make the best rental in the world. Sometimes, we have to give them bad news. When you buy on your own without professional advice, you are going to find yourself in trouble. There is a lot of knowledge that goes into picking the right rental property, especially in Orlando. We have great rental pockets and very poor rental pockets. Here are common mistakes:
 
Mistakes To Avoid When Purchasing Orlando, Florida Investment Properties
 

Location

 
As with any real estate transaction, location is essential. You must always buy in the right location. Don’t buy a rental property without consulting a professional property manager. That’s like asking a race car driver to drive a car he’s never seen before. When you talk to a property manager, ask about the location before you buy.
 

Size

 
Most people will buy a house based on price instead of size. But there’s no point in buying a house because it’s cheap if it’s 10,000 square feet. Similiarly, you’re not going to find a lot of renters looking for a home with only 400 square feet. If you don’t get the size right, you’re going to have a very small market of potential renters. Judge the size of the house you should buy by what rents best. In our experience, that’s a single family house between 1,300 and 2,500 square feet.
 

HOAs

 
Recently, we began working with an investor who bought a property in a great location that would have rented for $1,600 per month. It was a single family home with 4 bedrooms, 2 bathrooms, and a swimming pool. Unfortunately, the investor realized too late that the HOA does not permit any rentals at all. So that owner, who lives out of state, has a vacant property he cannot rent and he’ll have to sell it as fast as possible. We always look for HOA restrictions before we recommend an investment property purchase.
 

Condition

 
Investors usually buy foreclosures so they can do the work to get the place ready to rent, or brand new houses that need few repairs. Many properties are overlooked because they need superficial work. Don’t make this mistake. Unless you’re buying a foreclosure or a brand new property, budget between $2,000 and $6,000 for repairs and updates.  Buy properties that need sensible fixes such as new carpet, fresh paint, appliances, and fans. Don’t buy homes that need a new roof or a new patio. Those things will be out of your budget and won’t get you better rental prices.
 

Price

 
Everyone wants a deal and expects to pay bottom dollar. Those deals are gone but you can still buy well. The market is not yet where it was in 2004 or 2005, and while there are often multiple bids on a particular house, we aren’t seeing big auction prices. Prices are fair. If you buy at a fair price now and hold onto it for five to ten years, you will make a decent capital gain in addition to your rental income. Don’t be put off by a price. We’ll tell you if you’re overpaying. Brokers and managers with experience in the industry know the right numbers and we can advise you at what price point it’s best to buy.
 
Finally, a key error many investors make is to buy through sales agent without talking to a property manager. Property managers deal with the final product. We have the responsibility of dealing with the property maintenance and finding a tenant, so we’ll give you good long term advice. Choose carefully in Orlando.
 
If you have any questions on investment property buying strategies, please contact us at Warner Quinlan.
 
Mark Pagdin
 
President/Broker Warner Quinlan, Inc.
 
For more than 20 years, Mark has managed his and clients’ investment portfolios, garnering him the unique perspective as both owner and property manager. His blog series is an invaluable tool for investors looking for guidance on property management, purchases and acquisitions.