Buying a Florida Rental Home is Easier Than You Think

With its miles of beautiful beaches and warm winters, South Florida will always be attractive to vacationers and escapees from colder climates. Given that so many visitors prefer to stay in a home or condo—instead of a hotel or resort—it’s also a great market to own a short-term rental property. Here, some of Corcoran’s South Florida market experts offer their tips on finding—and buying—the perfect vacation rental property:

Head for the Water

In the Florida rental market, an ocean view setting — like this one at 719 North Ocean Boulevard in Delray Beach — is gold.

“Just like everything else in real estate, location is absolutely the most important factor in a property’s rent-worthiness,'” says Corcoran agent Nathan Zieman, who focuses on coastal Delray Beach and Boca Raton. “The home or unit could have the latest and greatest of everything, but if it’s not in a desirable area, the chances of getting high rents are low to none.”

In Florida, that translates to being on the water, whether that means logging beach time, boating and fishing, or dining along the intracoastal waterways. Oceanfront real estate will “always bring more in rents versus ‘dry’ properties or ones farther from the coast,” Zieman says. “The initial purchase price of the property is going to be higher as well, though.”

In terms of returns and revenue, Corcoran agent Lynn Feuerman, who markets luxury waterfront property in northern Palm Beach County, agrees. “Oceanfront is ‘gold.’ It is worth the premium of yielding much higher rental fees.” Buyers should remember that property prices drop in summer, when the market is less competitive. When the weather is the hottest, that’s the time to buy.

Condo or Single-Family Home?

Townhomes, like this waterfront tri-level on Hendricks Isle in Fort Lauderdale, can make excellent investment properties.

Once you determine where to buy, you need to figure out what: Condominium or single-family home. This decision will likely depend how often you will be in town, among other factors. If you’re not going to use the property yourself, Zieman recommends looking at condos. “Generally speaking, condo buildings with reasonable maintenance fees and relaxed rental restrictions are going to offer the best mix of features/amenities for the renter and ease of ownership for the owner.”

However, not all condos welcome short-term rentals, Feuerman cautions. “Most communities with homeowners associations have minimum requirements where you have to live there for four months or six months. Some communities do not allow rentals the first year after purchase. Some do not allow it for two years after purchase.”

Your agent can help you decide whether a concierge building on the beach with towel, chair and umbrella services is better than a house with an “updated and well-appointed kitchen and master bath, along with a clean, light and bright neutral interior that will appeal to the broadest audience,” Zieman says.

Know Your Target Market

For a more hands-on landlord experience, keep an eye out for homes with rentable guest houses, like 50 Coconut Lane in Ocean Ridge.

While condos will meet the requirements of singles, couples, or friends, single-family homes bring in people with kids (and possibly pets) who want backyards, pools, fences, safety, and privacy. Both types of renters require oversight on your part, just different kinds of monitoring.

To that end, you should also think about management, maintenance, and restrictions—especially if you’re planning on using Airbnb or a similar service to market and book your rentals.

“In Delray Beach, a permit from the city is required to rent a property, and there are certain tax implications should the lease be less than six months,” Zieman says. “Airbnb is allowed in the area, although certain buildings may not allow it. Condo buildings generally handle maintenance on the exterior of the unit or other building related items. Most will not handle inside unit maintenance or rental management, such as rent collection or tenant placement.”

Which Amenities Matter Most?

Retractible curtain walls, as exemplified by this sleek Modern on Palm Island in Miami Beach, afford seamless indoor-outdoor flow to maximize warm-weather living.

Once you’ve narrowed down location and decided on the type of property, it’s time to look at the amenities. Make sure you inspect the clubhouse, fitness center, pool and outdoor spaces to ensure they’re well-maintained and will appeal to vacationers.

Layout is a type of amenity that many buyers don’t consider. “A condo with two separate living areas is a better investment,” Feuerman says. “Or split bedrooms with a living area in the middle. That way people can have guests or family visit and not be on top of one another. For people who like to entertain, a summer kitchen, pool and spa are “great investments in houses,” she says.

Whatever you decide, it’s especially important to work with an agent who knows the South Florida market, so that your investment lives up to its rental potential.

Find your place under the sun.

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