[Worldseries27]

Originally Posted by retiredguy123

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.

agreed. Old saying, paper doesn't refuse ink

[Ski Bum]

Originally Posted by Laker14

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.

Your napkin is correct!

[kkingston57]

Originally Posted by C. C. Rider

Just doing some "back of the envelope" calculations, that doesn't sound very profitable to me. It seems to me that a brand-new house of the same size and quality would have to increase in price about 16% to 18% per year just to break even on the deal... not counting anything for your time involved. Making a profit on the deal would require an even greater price increase year-over-year.

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?

Real estate comes and goes. Fortunately for some, it has stayed good. Do recall drastic drop in and around 2008.

[Papa_lecki]

Don’t forget, if the property is set up as an investment, you get to depreciate it on your tax return, so any gain will most likely be offset by the depreciation loss. And all those expenses (amenity, taxes, utility) are also expenses. So your 20% gain when you sell in a year or two is basically tax free.

[retiredguy123]

Originally Posted by Papa_lecki

Don’t forget, if the property is set up as an investment, you get to depreciate it on your tax return, so any gain will most likely be offset by the depreciation loss. And all those expenses (amenity, taxes, utility) are also expenses. So your 20% gain when you sell in a year or two is basically tax free.

Not exactly. When you claim annual depreciation deductions, you reduce your taxes while the property is an investment property. But, when you sell the property, the depreciation deductions are "recaptured" and you pay taxes on them. So, the depreciation is not tax free, it is only tax deferred. In order to claim the house as an investment property, it has to actually be available for rent.

[SusanStCatherine]

645 Shauna Ln $457,530 increase in price sold in a year and a half.

Luck and Timing is everything.

[MrFlorida]

Don't forget the stress factor of watching the market rise and fall, plus interest rates rising and carrying expenses etc......Not much better than investing in Wall Street roulette.

[wmcgowan]

a house is only worth what someone is willing to pay for it - right?

move here:
https://www.youtube.com/watch?v=U7p8zPSonXc

[SusanStCatherine]

645 Mincey Loop
08/2021 - $582,016
10/2022 - $960,000

[Rainger99]

Originally Posted by SusanStCatherine

645 Shauna Ln $457,530 increase in price sold in a year and a half.

Luck and Timing is everything.

I assume that they made major improvements???

[jim@jedward.com]

Originally Posted by wmcgowan

a house is only worth what someone is willing to pay for it - right?

Sometimes, that is correct. However, some people are willing to significantly overpay for a house. That doesn't make the house worth it.

[vintageogauge]

Originally Posted by C. C. Rider

Just doing some "back of the envelope" calculations, that doesn't sound very profitable to me. It seems to me that a brand-new house of the same size and quality would have to increase in price about 16% to 18% per year just to break even on the deal... not counting anything for your time involved. Making a profit on the deal would require an even greater price increase year-over-year.

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?

We bought a new patio villa in 2019, sold it just shy of 2 years later for 70% more than we paid for it and had it rented unfurnished the entire time. The rental income covered all of the costs to own the unit so the 70% was all profit plus the positive income while rented. At this point, 2 years later, that same unit would sell for just about what we sold it for in 2021 so it's a matter of timing and mostly luck.

[KAM+6]

Originally Posted by Laker14

Well, perhaps some have doubled in the last 5 years, but in looking at the listings on Trulia this morning I see more that look like this one:

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.

Also , add upgrades, granite counters thru out, enclosed lanai, birdcage, epoxy garage and driveway, glass front door, crown molding, paid bond, etc etc.

[Escape Artist]

Originally Posted by Craig Vernon

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?

How old do you have to be to buy a home in the Villages? A neighbor of mine back in my former city of residence just bought one for investment/rental purposes and he’s in his early 40’s. Isn’t being over 55 a requirement? They never asked me when I bought (maybe it was obvious 😳 ) or perhaps during preliminary paperwork it was revealed but do you have to be 55+ to buy a home in TV or only to live here?

[retiredguy123]

Originally Posted by Escape Artist

How old do you have to be to buy a home in the Villages? A neighbor of mine back in my former city of residence just bought one for investment/rental purposes and he’s in his early 40’s. Isn’t being over 55 a requirement? They never asked me when I bought (maybe it was obvious 😳 ) or perhaps during preliminary paperwork it was revealed but do you have to be 55+ to buy a home in TV or only to live here?

There is no rule about the age to "buy" a house in The Villages. The only age rules apply to the residents of the house. Anyone can buy a Villages house.