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.