Quote:
Originally Posted by BrianL99
People on TOTV and in The Villages in general, seem intent on considering The Villages market (both sales & rentals) as a "one of a kind market".
It is not. It is a real estate market that's no different than any place else. It's driven by supply & demand. It's a market that can be somewhat skewed by the presence of "the Developer", but TV is now big enough that the Developer's influence is increasingly less defining.
We're in a declining real estate market. Sales are slow, prices are softening and the exact same thing applies to the rental market. The rental market and the sales market, seldom operate independently or contrary to one another.
Right now, a CAP rate of 7%-%8 isn't bad for an investor ... 5%-6% is good for an amateur.
Right now, I don't see how buying and renting a new home in TV gets you more than about 2%-3% max ... more likely, it's a loss.
As you point out, you can look at rentals differently if "profit" isn't your goal and one is only looking at cash flow balance.
As in every market, things change, but right now doesn't seem like an opportune time to be buying new in TV and thinking when you retire in 10 years, you're going to have a "free retirement home" that'a appreciated 200%.
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I would take issue with your second paragraph that the developer's influence is becoming less defining. Currently, The Villages sells about 3,000 new houses per year as compared to the resale market of about 800. And, the developer is large enough that they can control the supply and pricing of houses in The Villages. I would not call The Villages a one-of-a-kind market, but the availability of new houses constructed by a large developer is somewhat unique when compared with other housing markets. I would not refer to it as being no different than any place else.