Buying Orlando Vacation Homes
Buying or renting anything, let alone a vacation home, requires you to do your homework. This is what was concluded well over 15 months ago after writing about vacation home break even analysis .
Our interest was again piqued by a recent article in the influential Kiplinger’s Magazine entitled “Deal or No Deal”. Click here for this article. The article concludes that the retail price for the vacation home relative to the rent that it generates is the crucial element to consider when purchasing. Moreover, the author concludes that the size of the home and variety of amenities are necessary to maximize marketability. This relationship is highlighted in vacation homes:
- The net revenue or cash flow that the vacation home generates has always been at the heart of basic net present value calculations.
- At least as it relates to rental properties, this correlation has mostly been in sync with growth in personal incomes and net rental revenues.
There are at least three other additional concerns or “secrets” to keep in mind:
- Selecting an honest knowledgeable real estate agent/company can help your chances of reaching break-even or profitability, if that’s your goal. They understand where the pockets of value exist in the market, and can match your individual needs.
- Since cash flows from rentals are a big part of the valuation equation, selecting a professional management company to market and manage your property is also important. They can give you primary exposure on websites with thousands of visitors daily along with other important services.
- Although some vacation homes in conventional neighborhoods rent for “commodity type rates”, homes in higher rated resort style communities with close locations realtive to the parks generally attain higher rental rates due to reputation and referrals. It is best to look at what we refer to as “resort style branded communities”. Reference several of our posts on the “Top Rated Communities in Davenport and Kissimmee” which have developed a strong rental following.
As we stated on our original post, we do not give any professional advice as we are incompetent (reference our disclaimer). We strongly recommend that you seek the counsel of expert professionals to advise you when making a financial decision of any kind.
