Quote:
Originally Posted by CoachKandSportsguy
Consider target renters profile:
over 55, fairly well off, thinking about retirement,
seasonal wanting to get away from cold/winter, one month average, 2 months special, 3-4 months rare
can do this with remote work, doesn't have kids (not a young person or family destination)
or future villagers wanting to rent to either figure out where to live
waiting for their house to be built (want to be nearby)
short term 4-6 months max type renter
or relatives of villagers wanting to visit who don't stay long
holiday timings 1-3 weeks max Thanksgiving / Christmas only . .
Competition:
Marketing brand name of The villages rentals when buying from the developer (owned by developer)
Lifestyle visits, with golf cart
More houses being built/sold (1% turned into rentals)
Houses with closer amenities, golf cart, shorter cart drive to town squares, number of golf courses within cart driving distance < 30 minutes
average cost of a standard house, annualized:
$18-$22 K, including taxes, insurances, bond, all utilities, amenity fee, deed required landscaping maintenance, on premise liability, excluding financing costs, depending upon size and age of rental.
Occupancy rate = 30% to 70%
Break even monthly rate for 4 months ~ $5,000
January -> April high season one renter, if you can get one
Off season =$1,000->$2,000 monthly rates
Just some ball park costs and you can get the rental rates from searching for rentals yourself
YMMV
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I have 2 rentals and agree with almost all of this except - The Villages management is NOT a factor - have never even heard a renter mention them, they are rediculously expensive, and they only seem to rent the high season.
Also, there are less rentals than their used to be because a lot of people sold when the market was really hot. I was getting calls all the time from realtors wanting to sell my houses (one is my retirement home, the other I plan to sell when I retire and use the proceeds to not take SS until I turn 70).
Occupancy rate - I have averaged 11 months a year on both houses every year for 10 years (6 for the second one since when I bought it). So it is more like 90% but I have repeat renters October-May, and I keep my summer rates where the "summer house tire kickers" will rent from me. I much prefer the house full than empty.
The beauty of renting in TV is the Renters are all upper middle class to upper class retirees - The fix more things than they break. I have had renters change fire alarm batteries and only tell me when they check out.... Its amazing. My 10 year old house looks brand new.
HOWEVER, you are NOT going to get rich. I am currently high income, and I like the tax treatment and the fact that I don't have to worry about cap gains until I sell. I also write off all my trips to florida because I am working on the houses (yes, it IS work). I bought the first house to avoid inflation. I bought the second one to diversify my stocks and bonds - and boy has it. The appreciation has far exceeded expectations.
I have friends who have houses and 4plexes as rentals up north and I would never do that- horror story after horror story. You won't get rich doing rentals in the Villages, but you don't have to deal with crappy renters either.
Bottom line- its great if you are high income and looking to diversify, but would not count on getting rich.
Ed