Talk of The Villages Florida - Rentals, Entertainment & More
Talk of The Villages Florida - Rentals, Entertainment & More
#1
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Renting and flipping alive, well and needed to keep prices up?
While staying in the Villages in the month of May my wife and I looked at many homes but the most interesting was the new construction. We met two couples looking at the new model homes that told us they purchase two homes every year with the intention of renting or even keeping vacant for a year and then selling. They continued by saying they have been doing this process for eight years and made money on all their transactions and "many" others do the same thing. I asked if they live in the Villages, and they said no but they are the reason prices stay higher compared to other Florida locations. Hmmm?
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Saving for my place in the sun. |
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#2
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They are not the reason. The people who buy houses from them are the reason. It's the people moving here from other areas. Without that, all comes to a stop.
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#3
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I have been in the real estate/mortgage business for several years. The pricing of a preowned home is determined by comparables (homes that are similar in size with the same attributes and have sold in the last three months.) By law, you can not charge more for your home based on personal wants. It must be in line with the pricing of homes within your area. In 2008, the real estate market crashed because flippers and investors were misleading buyers about the actual value of the homes.
When you are purchasing a home do your research. Find as many similar homes in your area that are on the market or have recently sold. Before buying, place a clause in your contract that states the property must be appraised by a licensed appraiser to reflect the actual value of the home. Many people are emotional buyers. Flippers and investors use this and persuade the buyer to pay too much for the home. There are laws against this. Know your rights! I am in the market for a new home in the villages. Unfortunately, I have seen inconsistent pricing. Some homes, extremely similar to others, have a price tag of $50,000 or more. I researched a home I was interested in and found it was overpriced by $100,000. I am still in the market and probably will be for sometime. Throughout my buying process, I have been outbidded by someone who lives out of state and are paying cash for the home. A licensed appraiser is probably not requested in these deals. I let the homes go and do not bid higher. There are so many homes available that I do not see the urgency. No, I am not cheap! I just feel more secure in a home that will hold its value and provide me with equity in a few years. No one wants to lose money on a home purchase! |
#4
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This movie always has the same ending.
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#5
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The guy I am quoting above has the correct take on this. This time the underlying factors in high real estate prices are very different than they were when the bubble burst in 2007, but, even so, I think this market will slow……… There is no inventory in other places the country. A lot of first-time homebuyers are waiting and saving to get a good size downpayment — and besides, there is nothing for sale anyway. I am back North now and in my Ohio city, developers are slapping up “stackable” condos and apartments for millennials to buy in the ‘burbs. (I think those buildings look like filing cabinets and they basically are, in a way, but they sure are not cheap — just more affordable than buying a retired boomer’s house.) I think the next big step in real estate is to convert all this empty office space I am seeing now into condos. That space will never fill up with workers again. There is too much of it. (REITs have to be hurting.) But, hey, I gotta get outa here tonight. I got lured in with this thread of real estate talk — which I love. Seeya, Boomer
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Pogo was right. |
#6
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I know that housing is becoming more expensive every year, but is it actually increasing at 25% or more per year which is what I figure it would take to make it worthwhile? |
#7
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#8
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#9
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#10
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I find these stories of people "always making money" on the deals a lot like listening to people talk about how well they do at the casinos. They don't like to share the bad experiences in between the big payoffs. Insurance, taxes, maintenance , amenity fees and interest payments (or alternatively the loss of investment opportunities with the money tied up) all take their toll on the bottom line. |
#11
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2541 English Ivy Cir, The Villages, FL 32162 | MLS# G5066644 | Trulia which, when looking at price history reveal that even at current asking price, the house hasn't doubled since 2004, than I find homes that show a 100% increase over 5 years. |
#12
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Here is a typical example:
4362 Watch Hill St, The Villages, FL 32163 | Trulia note, this is from an actual sale, not a listing. This is what the house sold for, as opposed to asking price. in July 2017 it sold for 294,700 in May 2023, it sold for 462,000 Take 6% for the realtor (correct me if that's wrong), and you have a gain of around 140K, over 6 years. Carrying costs I'd estimate at around 12K/ year assuming no mortgage, so that 140K gets chopped down by 72K (again I'm doing this on a napkin, I didn't include bond payments ), so now we're looking at about 68K "profit" on a 6 year 294K investment, which is about 23% over 6 years, which is more like 3% to 3.5% return /year on the original investment. Meanwhile that money was not in the stock market. So, it's not the "no brainer" people sometimes like to make it out to be. |
#13
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#14
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In my experience, most people who claim to make a lot of money on real estate, will exaggerate the profit they actually make, or they just don't understand the math.
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#15
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Don’t get me wrong. We’ve made a couple of dollars on properties over the years by buying, renting and selling after appreciation and also vacant development land. It just doesn’t seem to be profitable to leave a home vacant for an extended period in hopes appreciation will offset all the initial and recurring costs of ownership Last edited by Sandy and Ed; 06-12-2023 at 04:36 AM. |
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