Where to Buy Investment Property in Florida
This is part one of a two-part blog that talks about where to invest in Florida, specifically Tampa Bay. In today’s part one, we will discuss where to buy property and in part two, we’ll discuss where not to buy investment property. At Hoffman Realty, we have been property managers and landlords for about 30 years. We certainly have a lot of experience in this area and that’s why we can recommend these three areas for investment property purchases.
1. Single family construction on the outskirts of the urban core.
These areas include communities such as New Tampa, Wesley Chapel, Land-O-Lakes, Lutz, Riverview, Valrico and Seffner. The reason we recommend these areas is that in the last 10 to 15 years, there has been a lot of new construction in those areas. The new construction homes are built to the latest codes and they have modern systems for electrical and plumbing. You’ll also find contemporary floor plans, which make them attractive to renters. There are often garages and usually these homes are built in neighborhoods with community clubhouses, pools and playgrounds. These things make those homes very appealing in the rental market.
2. Single family developments within the urban core.
These will be more mature homes, and we’re talking about houses in Tampa, Clearwater, St. Petersburg, Brandon and Palm Harbor. When you purchase homes in these areas, you’ve got to be more careful. Make sure the major systems in the house such as electric, plumbing and the roof are all in good condition. If the house was built prior to 1978, it may have lead based paint and that’s something you want to be very aware of with renters. Often, the older homes were built below the flood elevation, and that can be very expensive to insure. It will steal your cash flow, so avoid homes built below the flood elevation. Finally, get insurance for the property. Older homes in Florida are harder to insure but you want to make sure your property is fully covered.
3. Units within associations.
You can also purchase a unit, such as a condominium. The first two choices we discussed are single family residences, which are less restrictive than condominium units. When you purchase an investment property within an association, there will be more restrictions on your property. You want to make sure the association is solvent – some are not these day. Find out if the association is able to purchase insurance, because that’s getting harder too. Find out if there are upcoming special assessments. Special assessments are huge cash flow robbers for landlords. Then, you need to ask about whether the community is pro-rental. A surprisingly large number of associations are very restrictive on rentals, and that can really hurt your cash flow.
So these are the three areas we recommend purchasing an investment property in Tampa Bay. Contact us or give us a call if we can answer any questions at 813-875-7474.