RENTAL HOMES: SMALL INVESTMENT YIELD LARGE RETURNS IN ST CLOUD FLORIDA HOMES

RENTAL HOMES IN ST CLOUD FLORIDA– While news reports of a down housing market may have discouraged many would be homeowners from taking the plunge back into buying Real Estate;  investors flocked at the opportunity to scoop up distressed property at a huge discount. 

Contrary to popular belief,  Investors are not necessarily guys in business suits but rather average people with a basic understanding that timing is everything when it comes to buying and selling real estate. Buy low, sell high.  Declining value means opportunity. 

Investors watched the market here closely. As the glut of foreclosed homes hit the market, they had an ample supply of inventory to choose from. Most were looking for 3 bedroom 2 bath homes in St Cloud Florida. 

Why developments don’t work as good investments.

 While planned developments appeal to the average consumer, novice investors lost their shirts when the housing market peaked back in 2007.  Why?  Savvy investors look at the bottom line. Novice investors don’t. 

 Novice investors,  did not factor in the carrying costs and additional fees as part of their investment properties in St. Cloud Florida.  For that reason sub divisions while appealing to consumers as primary residences are attractive, are losing propositions for seasoned investors who know the burden of additional taxation such as CCD fees and Home Owners Association fees chipped away at their profit margins.

CDD fees (community District Development) are bonds the builders put in place to pay for amenities like sidewalks, street lighting,  club houses, community pools and common areas. These bonds are rolled into the property tax paid by Kissimmee and St Cloud Florida  home owners.

Comparing apples to apples, a 3 bedroom 2 bath home within the city limits of St Cloud Florida (outside of development) may have property taxes within a range of $2000-3000.  A similar home inside a development with  CDD fees would have a tax base of $3000-4000. Not including the additional cost of the home owners association fees.   It is not hard to figure out why they went belly up when the market went flat. They got caught short as value began to decline and the carrying costs were prohibitive from profitable renting.

Rental demand is on the rise.  The hundreds of thousands of people that got caught up in frenzy of the heated real estate market between 2005-2007 have lost their homes. As a result, they are now converted renters. Rents are predicted to rise annually as the demand for housing increases.  A 3 bedroom home in St. Cloud Florida will fetch $900-$950 a month.  A four (4) bedroom home can expect to yield $1200-1500 a month in the St Cloud Florida Area

While it is true that prices have slowly inched up over a year ago, at about a 6% gain, the selection of quality homes has decreased proportionately. What is coming to market now, are homes which have been in the foreclosure process for years in some cases. As a result they need a great deal of work to bring them back to rent-able status. 

 Early on, banks were reluctant to sell to investors, in fact, many would not.  They were holding out for the new wave of first time home owners who would finance the purchase through them giving them one more opportunity to try and recapture their bad debt.  That wave never materialized.  What did materialize were buyers offering cash for investment properties.

In a time where we are seeing values finally starting to rise, sompared to other parts of the country, Osceola County, specifically St. Cloud Homes have seen a median sales price rise on resale properties, which is  currently at $185,200.

Lease to Own Property in St. Cloud Florida

 LEASE TO OWN RENTALS INQUIRIES RISE  in my Market of St cloud Florida.

Lease To Own Homes, not a new idea by any means, but an old idea that is experiencing a renewed interest among renters. With Sellers…not so much. The concept of “leasing to own” or “Lease With The Option to Buy” is designed for renters to be able to apply a portion of the monthly rent to a down payment to purchase the property at a later date. (Typically within a year of the lease agreement)
 
Increased demand for housing, has lead some renters to make more inquires about Lease Options, or Rent to Own properties. But in a distressed area, that can be a very risky proposition. If the landlord/property owner is in default you could end up losing everything you have down.
 
For Sellers, there is NO benefit in a rising market. If you agree to sell the property in a year, you are speculating that the price would have to drop in order for your deal to be a good one for you. Unless there are other factors influencing your decision, and you feel having a buyer ” in residence” is the best way to go.
 
If you have been waiting for the market to “rally back” to previously over inflated property values, then it is not a good idea to engage in a contract now. A lease to own not only involves a lease, but a purchase option which if signed by all parties IS a contract.
 
While it is unlikely the prices for homes in St Cloud or homes in Kissimmee will get back to those previous high watermarks anytime in the near future. Many Florida home owners need to see the housing market improve from where it currently is and are waiting patiently for the market to turn around before considering selling. An average home price is $121,000. Most people who purchased in 2005-2007, cannot afford to sell for that price. So as a result, they would not benefit from a lease to own scenario at this time.
 
The housing market is far too unpredictable, and still under pressure from foreclosures, and short sales to make Lease/Options viable. In a years time, the renter can” opt” out and choose not to purchase. Also known as first right of refusal. But depending on where the market is at that time, it is risky. In a rising market it is clearly to the advantage of the renter/buyer. In a declining market it is the seller which would benefit to the greater degree. Which is why under present market conditions, and an uninspired economy, the Lease To Own Purchase Option has all but vanished in Real Estate.
 
Poor Credit also plays a factor. People looking to rent (with Lease to Own Options) generally have a credit issue of some sort that would prevent them buying outright. Otherwise, they would be seeking to capitalize on the historically low home loans lenders are currently offering (still under 4%) and be pre-approved to purchase property outright.
 
Those will less than stellar credit, are hoping to secure a “deal” while prices are low now and capitalize on it later when the market has more sufficiently rebounded and their credit may have matured to a point where getting a loan is more viable.
 
The Census Data indicates that 65% of American own their own homes. Down from previous years, is the result of the mortgage meltdown crisis, high unemployment, under-employment and a lackluster job market, and homes still underwater, combined with the foreclosure fallout and recent escalation of foreclosure filings, which is affecting one in every 167 homes locally.
 
Sellers who find themselves owing more than their homes are currently worth have other options with their lenders under the Home Affordable Mortgage Program (HAMP) and lender incentives giving them cash at closing to remain in their during the short sale process.
 
In addition, the 25 Billion Settlement with the five top lenders as a result of “Robo” signings have resulted in an increase of home loan mofidications designed to save home owners from going into foreclosure by reducing the amount of their current monthly mortgage payments.
 
Freddie Mac reduced fixed-rate 30 year mortgage interest rates by 1.5% saving homeowners who owed $200,000 a whooping $2900 in interest payments a year.
Banks are working harder to reduce principal amounts owed in hopes of decreasing the record high foreclosure filings which have plagued Florida for more than the last four years.
 
As the number of renters increases, rents are expected to continue to rise proportionately to demand for rental properties.
Investors know holding properties long term is one way to increase profitability-and therefore would not consider converting a “cash cow” into chopped meat by taking a lease option on their investment.
 
So with inquires on the rise, understanding why the supply of these types of homes is in short supply gives renters who wish to re-enter the home market (at some point in the future) a better understanding of why sellers are reluctant to want to participate at this time.
There risks to the renters as well. A “landlord” giving you a lease option and is not making mortgage payments is still at risk for losing their property to foreclosure. Placing the renter is a precarious position. The lease would be honored, but the Purchase Agreement may not. Leaving the would be buyer out the money which was to be applied toward the downpayment or purchase price.
While it is tempting from a renter perspective to want to maximize their return on their rent money by having it be utilized as dual purpose rent/ downpayment credit; it is a slippery slope. Finding a cooperative buyer, having a fully executed contract, making sure money is deposited into escrow, and a monthly accounting of what funds are being applied and how, make the bookkeeping aspect significant. Consult a real estate attorney before signing any legally binding agreement.
Millions of former home owners are affected by either having participated in a short sale or been foreclosured upon, and possibiliy even filed for bankruptcy and as a result have damaged their credit.
Renters who have poor credit and feel they cannot qualify under current lending standards, should still consult with a lender and learn how to improve their credit scores, ask what the proper time frames are to re-establishing credit worthiness, and how they can re-build their credit to an acceptable level for credit consideration in the future and construct a plan to achieve that.
 
 

 

Examining the St. Cloud Rental Market- Why developments don’t work as good investments.

 Examining the St Cloud Florida Rental Market  Why developments don’t work as good investments.

While planned developments appeal to the average consumer, they can be money pits in disguise.  The park-like settings, and Norman Rockwell appeal comes with a hefty price tag. 

Consumers want nice amenities. They want community pools, and fancy clubhouses, fitness centers, and lighted sidewalks for evening strolls.  All of these things cost the builders money. Or does it?

CDD fees (community District Development) are bonds the builders put in place to pay for amenities like sidewalks, street lighting, club houses, community pools and common areas. These bonds are rolled into the property tax paid by home owners.

 Novice investors lost their shirts when the housing market peaked back in 2007.  Why?

 

Saavy investors look at the bottom line. Novice investors did not.  Attracted by the new, shiny, and nice features not the bottom line. They were thinking like “home buyers” and not like “investors”.  As a result, they got sucked into losing propositions.

Novice investors, did not factor in the carrying costs and additional fees as part of their investment. For that reason sub divisions while appealing to consumers as primary residences are attractive, are losing propositions for seasoned investors who know the burden of additional taxation such as CCD fees and Home Owners Association fees chipped away at their profit margins.

Comparing apples to apples, a 3 bedroom 2 bath home within the city limits of  St Cloud Florida (outside of development) may have property taxes within a range of $2000-3000.  A similar home inside a development with CDD fees would have a tax base of $3000-4000.  Not including the additional cost of the home owners association fees. 

It is not hard to figure out why they went belly up when the market went flat.  They got caught short as value began to decline and the carrying costs were prohibitive from profitable renting.

While sub-divisions are still appealing to many as primary and secondary homes, they are by no means “tax-payers” when it comes to investment and return on investment unless renter have deep pockets. Which in this economy is hard to come by. 

What Renters are Looking for.

It can be summed up in just 2 words.In two words: AFFORDABLE HOUSING

Most renters are very cost conscience. Times are tough all over, unemployment is high, and disposal income is diminishing.  As a result renters are looking to cut costs where ever possible.  They are turning to the historic homes, and smaller homes in town as a way of saving money and cutting back on paying for amenities they will rarely use.

HOW TO MAKE THE MOST OF THE REAL ESTATE MARKET IN KISSIMMEE/ST CLOUD

Wondering how to make the most of the Real Estate market in Kissimmee and St Cloud?  If you are like most people, you are very aware that there are some great  buys on homes for sale in the Kissimmee and St Cloud Florida area.  With current mortgage rates at 3.87% and the added benefit of the mortgage interest deduction, still available this is the prime time to be seriously looking.

Are Cheap Houses Really A Good Buy?

No. While the prices may be tempting, cheap houses may not be the bargain you think they are. Factors that need to be considered are:

Cost of Repairs

Cost of Insurance

Age of the home

Location

Cheap homes are often older (sometimes historic) homes.  They may need a lot of work.  A home inspection is a good launching point to determine the age and efficiency as well as functionality of the major components of the home.  A good home inspection can range from $200-400 depending on the size of the home. It is highly recommend you invest in one prior to making a purchase agreement.

Most people under estimate how much the actual repairs will cost.

Foreclosed homes are typically in need of several thousands of dollars of repair work as they have been long neglected and uncared for. 

 

   LOW END HOMES & HIDDEN PROBLEMS

 Hidden issues such as mold,  termite damage, water intrusion, and wood destroying organisms can be very expensive to eradicate.  Lenders make no warranties as to title or condition of the properties they are selling, therefore it is very important that you do your own “due diligence” and know exactly what you are buying before you sign on the bottom line. 

 Estimates do not include additional problems incurred while renovating.  Allow an additional 20-50% over the estimate for unexpected problems which will need attention and add cost to the job. 

MID RANGE HOMES YIELD THE BEST RETURN

Instead of shopping in the” bargain basement” of the home market, consider rolling in the repair costs and looking at mid-range homes.  Avoiding the “money pit” homes, and instead taking the repair money and applying it to a mid-range home will not only increase the inventory of homes you have to choose from, but the potential for the greatest return on your investment long term.

A cheap house is exactly that. It will not increase in value comparatively to a mid-range range home in dollar for dollar investment. An 800-1000 square foot house is never going to be worth what a 1500-2000 square foot house is.  Regardless of the market conditions.

Mid-range homes are newer, and often located in planned developments. They are larger and have a more favorable resale down the road. They will most often require a lot less work. 

Mid-range homes are usually short sale properties or in some cases traditional sales, where the owners have maintained the homes to a better extent than a foreclosed home which has been vacant. Short sale homes can still be purchased at a discount compared to a traditional sale as the price reflects current market value.

HIGH END HOMES- GREATEST POTENTIAL FOR RETURN

 The market downturn has hit the luxury market hard, making now a great time to capitalize on the larger homes which were once completely unaffordable.  Looking at long term holdings in Real Estate, bigger can be better. Especially for younger families looking to grow over time. If you are financially able, the best buys right now, are in the high end homes. They are much larger, have more upgrades, and location is always a factor in best return on our investment.

 

 

 

 

 

Kissimmee St Cloud Florida Why Buy Here?

      Kissimmee-St Cloud Florida Homes- Why Buy Here?

      Kissimmee -St Cloud Florida Homes For Sale.  Kissimmee St Cloud is geographically convenient to all the attractions without the tourist traffic most locals dread. Located southeast or Orlando, and within close proximity to the Orlando International Airport.  Yet it is near the hub of the attractions such as Disney, SeaWorld, The Wizzarding World of Harry Potter at Universal Studios, Beautiful  sprawling, sun soaked sandy Beaches on the Space Coast, and Melbourne Beach, and Cocoa Beach the hub for cruise lines. It is also  an easy drive to Daytona for Nascar fans.

St.Cloud Florida was established in 1909 as a City.  There are still many St. Cloud Florida Historic Homes which dot the tree lined State Streets.   St. Cloud Florida roots date back to the Civil War era. It is home to G.A.R., Veterans Museum in Kissimmee, Veterans Library, and many military vehicles are proudly on display in the park located on Highway 192 which is the main street.

The beautiful St Cloud Florida historic District is rich with restaurants and unique antique shops, vintage hotels, and a sense of small town Americana in the shadow of the high tech amusement parks located within a half an hours drive.

It is the geographically, the best place to live being centrally located, and predominantly residential.

Minutes from Lake Nona Medical Complex,Medical School, an easy commute to Orlando, or The University of Central Florida (UCF) and both the Osceola and ake Nona campuses of Vallencia College

Architecturally, the styles of homes in St. Cloud Florida vary dramatically. From its sugar mill era of turn of the century homes to modern new modern communities. There is something that will appeal to just about everyone.

Whether you are sun-seeking, or relocating  to Florida St. Cloud Florida has something for everyone. Homes, Land, Business Opportunities are all available here.

St.Cloud Kissimmee Florida home Prices are very attractive to Buyers, and there is an ample selection of homes to chose from and homes are slowly appreciating in year over year comparisons.


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Relocation services to Kissimmee St Cloud Florida are available. Contact us for a free relocation guide email a request to: Allison@Kissimmee-stcloudflhomes.com

st cloud  median sales prices

 Allison Stewart Real Estate Broker/Owner- St. Cloud Homes & Land, LLC Local Kissimmee-St Cloud Florida Real Estate Experts. Looking to buy in Kissimmee -St Cloud Florida; we will streamline the process and eliminate stress with our proven Purchasing System. Looking to sell your existing Kissimmee -St. Cloud Florida home we have a program for that too. We provide Unparallelled Customer Service, Rapid Response, and concenrate on your individual Real Estate Needs. Have a question? Contact us at Allison@Kissimmee-stcloudflhomes.com or call 407-616-9904

 

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St. Cloud Kissimmee Real Estate Experts

St. Cloud Homes & Land, LLC YOUR Local Real Estate Experts serving Home Buyers/Sellers in Kissimmee, St. Cloud Fl, Harmony, Lake Nona, Anthem Park, Bay Lake Ranch, Lake Lizzie, Reunion, Celebration, Lakepointe, Steven Plantation, Acadia Estates, East Lake, Windermere, Bay Hill. Our unparalleled service begins with YOU.

Allison Stewart Real Estate Broker/Owner- St. Cloud Homes & Land, LLC Local Kissimmee-St Cloud Florida Real Estate Experts. Looking to buy in Kissimmee -St Cloud Florida; we will streamline the process and eliminate stress with our proven Purchasing System. Looking to sell your existing Kissimmee -St. Cloud Florida home we have a program for that too. We provide Unparallelled Customer Service, Rapid Response, and concenrate on your individual Real Estate Needs. Have a question? Contact us at Allison@Kissimmee-stcloudflhomes.com or call 407-616-9904

St.Cloud Homes & Land, LLC
Allison Stewart Broker, SFR, CDPE
407-616-9904
Allison@Kissimmee-stcloudflhomes.com

 

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When buying or selling A Kissimmee St Cloud Florida Home Market Study Shows Surprising Fact

When Buying or selling  a Kissimmee St Cloud Fl home Market study shows surprising fact

Consumer Fact:

Only 4% of the consumers polled by the National Association of Realtors reported that Company Brand mattered. 

90% are looking online. Just as you are right now.

Real Estate is local.  What you look for is:  a property that meets your needs, appeals to your individual tastes and preferences, and one that will match your financial ability.  Next is finding a local Real Estate Professional to assist you. 

Realtors®  and Real Estate Agents

Realtor (pronounced Real-tor) are members of the National Association of Realtors® Real Estate Agents are not necessarily Realtors but all must be licensed.

                                                                                                   St. Cloud Homes & Land, LLC we are both.

 St. Cloud Homes & Land, LLC is a local Real Estate  Agency specializing in Residential Real Estate. This includes a large selection of St. Cloud Florida homes, vacation homes, town-homes, and condos. We also service Kissimmee Florida homes, vacation homes, town-houses, and condos.   We are local Real Estate specialists.

We are able to bring you the latest listings through our  Property Searches Page, seamlessly, and from the comfort and convenience of your current home.  By allowing you to preview online the current list  Kissimmee or St. Cloud H0mes for sale, it gives you an opportunity to see what is available and what will fit in your budget.  Once you contact us, we can organize a specific search based on your criteria and narrow down the best matches individually tailored to your needs.

  A large brokerage employing  many many  agents are much more likely to have a higher percentage of non producing agents, less Broker interaction and layers separating the consumer from the actual Broker.

The larger the company, the  more departmentalized  they have become.  Kind of like big Government.  The basic procedures, do not differ all that drastically from  a smaller family owned operation for instance.  Large or small, the mechanics of the Real Estate Industry are all basically the same.  We work with buyers and sellers to achieve a successful sale.

In Kissimmee St. Cloud Florida the mainstay of our community is small business. Businesses locally grown; which employ local people; servicing the local community.  Homes for Sale In St. Cloud Florida vary in architectural design, from historic to modern.  It is the sense of community which brings people together and it is why people want to live in St Cloud Florida, buy homes in St Cloud Florida and choose to buy businesses here in St. Cloud Florida.  

At St. Cloud Homes & Land, LLC we pride ourselves in being people oriented. Yes, we sell property.  A lot of it, but it is really about putting people together with properties they love.  It is about providing great reliable service, integrity and honesty.

 

Homes & Land, LLC,. A local St Cloud Florida Real Estate Brokerage.

Committed to excellence and superior customer service, the emphasis has always been on Unparalleled Customer Service which begins with YOU. St. Cloud Homes & Land, LLC has performed consistently and grown over the years. What makes us successful is our commitment to you.

Knowing a little about us is nice, but Focusing on what is important to you is what we do best!

Whether Buying St Cloud Florida Homes & Land, or Selling St. Cloud Homes or Land, Allison will take the time to find out what is important to you, answer your questions, and share important information on current market conditions.

Licensed and Certified we specialize in ALL aspects of residential Real Estate. From contact to closing we are with you every step of the way, answering your questions, overcoming obstacles and getting you to the Closing table as stress free as possible. Our team consists of like minded, friendly knowledgeable Sales Associates who offer outstanding Customer Service. We guarantee you love what we can do for you in making your Home Buying or Selling Experience with us a good one.

St.Cloud Homes & Land, LLC is a full service Licensed Real Estate Agency Providing OUTSTANDING customer service and commitment to excellence for its clients. Kissimmee Homes, St Cloud Florida Homes, Kissimmee Vacation Homes, Kissimmee Town Homes, Kissimmee Condos, St Cloud Vacation homes, St Cloud Town Homes, St Cloud fl historic homes, St Cloud Fl condos, all OSceola County Real Estate Properties.

Our Customer call us ” The best in business”, call us 407-545-8002

St.Cloud Homes & Land, LLC is a full service Licensed Real Estate Agency Providing OUTSTANDING customer service and commitment to excellence for its clients. The best in business, call us 407-545-8002

St.Cloud Homes & Land, LLC
Providing Professional Real Estate Services
2490 Bronco Drive
St. Cloud, FL 34771
Phone: 407-545-8002 | Email: Allison@Kissimmee-stcloudflhomes.com