When you’re thinking about to invest in a property in Orlando, planning ahead is the best way to avoid errors that can cost you a lot of money. Especially if you’re investing in a property in a city where you don’t live or don’t know well, is important to do your research, receive professional advice with experts that can help you make the right purchase and help put you on the right track.
We want to help you to make a successful investment here. If you’re planning to buy an investment property in Orlando, avoid the following but common mistakes:
1) Not setting investment goals. Most buyers have the primary goal to earn money from their investment properties whether they rent short or long term, but the two are not alike. Vacation rentals properties should be purchased with the main goal of enjoyment and required more operation expenses than a long term residential property. Will you hold the property 5 years or 10 years? Are you buying for rental income or appreciation for future gain, or an investment property with the plan of retirement home in the future? Having clarity of your goals, sharing them with your agent and teaming up to find the ideal property can be a home run investment.
2) Not working with an agent who specializes in selling and rentals of investment properties in the Orlando market. Your agent can give the professional advice about all of the aspects of your investment, including the type of market, the potential of the house rental and equity and help you to have an estimate of the costs of being an owner-investor. Also will help to find the best property that fits your interest and budget, show them and guide you through the process from the selection, to execute the buying process, property management and rentals, as well as future sale of the property to conclude a successful investment cycle.
3) Not having the real idea of the cost of an investment property. Buying a home in Orlando (same as many other cities around the United States and other countries), came with many responsibilities and charges. Not only the mortgage, in case that you need to have financing to buy, but also property taxes, insurance and HOA, a Home Owners Association fees that most of the communities require to pay. These are only a few of the expenses and is important that you included all in your budget and have real expectations about the income vs. expenses that you’re going to have. It is important that you consider all the costs that will affect your cash flow and keep a reserve account on an annual basis for these potential costs.
4) Not doing your research: Ask many questions about the property, but also about the neighborhood, and be sure that they allow to have rental properties. In Orlando, the neighborhood can have rental restrictions, including the not been able to rent for the first year, not been able to rent at all, or some communities maybe will be just for persons of age 55+, among others.
5) Not hiring a professional property management company. After you buy your property, the best decision is to hire a property management that handles the marketing and all aspects of the property, including, tenant screening, maintenance, rent collection, managing escrow and send you the reports of your property.