In Buyer's Guide
You'll probably have a lot of questions about buying property abroad, investment property, finding a property in Florida and buying property to rent amongst other things.
Florida Countryside personnel conduct seminars on 'Buying Florida property' worldwide and what follows is a summary of the questions we are asked most often at these seminars, together with our answers. Your attention is drawn to the important notice at the foot of this section.
A. When a non-resident visitor without a visa wishes to enter the USA, a visa waiver form has to be completed. This should allow the bearer a stay of up to 90 days as a tourist. No non-resident visitor is allowed to stay more than 6 months in any 1-year and when more than a 90-day stay is required, an appropriate tourist visa is required. Several specialist consultants provide a visa service that can help visas be obtained & we can supply details if this is of interest. You can also find out more about visas here.
A. With a cautious approach, the correct type of property and location, plus a wise choice of management with some degree of owner participation involving rental bookings, it is realistic to expect costs to be covered from receivable rental income. However a considerable amount will naturally depend on the purchase price, mortgage required and the future, which is of course always unknown. The recommended 'Florida Countryside purchase price points' act as a good start guide - they assume a 75% loan, average management costs and rental income, plus the costs quoted do "err on the side of caution" and are estimated as high rather than low. However safe any projections look, however, remember there can be no guarantee they will occur and therefore there is obviously a degree of risk attached. We believe no purchase should ever be contemplated if it solely relies on rental income generated to pay for itself.
A. First it should be noted that no foolproof guaranteed rental scheme exists and therefore all should be viewed with a certain degree of scepticism. A guarantee is only as good as the company offering it, although there are of course good and bad companies. For example, some builders periodically offer 'lease-backs' on their model (show) homes and this provides a good opportunity for buyers, as the builder will normally pay the running costs plus a healthy rental return. This way a buyer is pretty much assured of the offer being genuine, as it makes good commercial sense for both parties. When, however, a 'blanket guarantee' is offered on several homes on a particular development or on a home specific to a particular source, normally some kind of condition or even a catch may exist.
It could be the property being offered with the guarantee is overpriced or possibly the rental income proposed is below a ready realisable amount. One thing is for certain, if the rent is 'guaranteed' the grantee will not be intending to lose and will be ensuring that in some manner or means they do not take the risk. The risk will lie with the owner of the property. A good management company should be able to achieve bookings regardless of any guarantee and when part or total owner participation of rental bookings is forthcoming, the financial results are normally more rewarding.
A: The answer to this question will naturally depend on the amount of effort any owner is prepared to undertake. Nowadays there are several specialist web sites advertising property abroad. A striking individual 'owner web site' will normally attract a high quantity of rental bookings for its owner. We believe a good web presence is essential if a worldwide coverage for bookings is required.
Besides advertising within such media sources, web sites and villa publications provide new homeowners with a direct source to other like-minded owners of similar styled property. Direct contact with such an owner can lead to what can be a most cost effective rental opportunity, for a 'rental booking sharing relationship' can be formed.
Marketing to friends, family & business colleagues, is another common way of obtaining rental bookings. Most people nowadays will know of someone who is planning to visit Florida and therefore with a little effort private rental bookings are realistic to achieve. Most management companies are happy to work with owners who obtain private bookings themselves and many will forego part of their management fee when this does occur.
A. Land zones control land use and back in the late 80's few zonings related to property rentals in Florida as the market for rental properties had only just commenced. The property demand was high and many sales took place in a short period. When American citizens suddenly found their latest neighbour was an absent owner and "faces changed on a regular basis" problems occurred, as can be imagined, and the complaints that followed resulted in the current zoning position. Land zoning is like a planning consent, once granted it should be nigh on impossible to take away and if a State authority did consider it, an extremely strong legal argument to prevent this happening would of course exist.
It is therefore most important to consider any possible future use at the time of purchase, as once a property is purchased a buyer is then stuck with the land and its use. However there is nothing to stop a site with no zoning having an ordinance passed and a zone restriction applied thereafter.
A. The definition of 'short term' is transient, meaning ANY period of time that the property is being let for. Should it be a stay of 1 day or even a permanent stay, all are possible as any term is allowed. When a property is bought for personal use only it is worth considering if at anytime in the future a letting of the home is contemplated. A 'short term' zoned home allows maximum flexibility and it does not prevent its owner from living in it full time if required. Other zonings do exist; some can allow 1 letting a month, 1 every 3, 6 & 12 months and all manner of other permutations. A 'short term' zoned home should also provide its owner with a worldwide market of investors at the time of sale and therefore in our opinion this remains the best option for 'non-resident' buyers, regardless of their rental intentions.
A. February through September in Orlando and January through Easter along the coast. Christmas- New Year- Easter & Thanksgiving holidays are also traditional busy periods.
A. If only we knew the answer to this question we would make a considerable amount of money by predicting the future! Some facts can help us guess what might happen in years to come though. The number of tourists visiting the region from all over the world has been rising annually and Florida remains the undisputed sunshine state and "entertainment capital of the world". The International airport in Orlando predicts phenomenal visitor growth over the coming years and appears to have the land capacity and potential plans for future expansion to cope. Judging by growth to date, their projected figures look very likely unless of course the unexpected occurs.
The major tourist attractions in Orlando are pouring millions of dollars into 'visitor attractions' to try and ensure visitor demand is sustained and all of the facts seem to point to visitors wanting to return. Villas with pools are an effective cost alternative to traditional holiday accommodation, as they can provide home comforts at cheaper costs than hotels and still be close to attractions such as Disney World.
The authorities have found an effective way to curb the supply and location of rental homes by land zoning and therefore suitable 'short term' zoned homes purchased today should possibly become more desirable if and when restricted zonings limit future supplies.
A. So long as the broker you choose to act for you is a member of the MLS (Multiple Listing Service) access to every property for sale is enjoyed and if you deal with more than 1 broker it can only serve to confuse the position as neither broker will be able to act solely on your behalf. Not only that it may possibly even cause a conflict to occur between the two brokers.
A. So long as the salesperson or broker is licensed by FREC (Florida Real Estate Commission) and this is a legal requirement within the State for anyone involved in Real Estate, you can rest assured that they will have a duty to do so and therefore they should be very careful what they say.
A. No it is a completely different system as the broker has a choice and yet regardless the seller still pays the fee. At Florida Countryside we act on behalf of buyers and therefore we have a fiduciary duty to provide the best for our client buyers.
A. It is entirely up to you whether or not you specifically feel the need to employ someone to oversee all of the formalities, it is certainly not essential. Within the US, independent Title closing agents and sometimes lawyers, are employed to deal with title transfers and they act in a similar manner to Insurance Companies by providing insurance that the title is in order and such a firm will deal with the transfer regardless of whether or not you employ a solicitor to act on your behalf.
A. When rental income is being sought the income is likely to be paid in US $ and therefore it may be safer to obtain a dollar mortgage to avoid fluctuating exchange rates. However each person's circumstance is different and we are not qualified to provide any financial advice. We therefore suggest that independent advice is taken from a qualified source and if necessary a US mortgage expert can be asked to discuss the $ loan aspect with you prior to any purchase.
A. Although at first glance it may appear as though there is no incentive for us to operate this service without charge, on closer consideration it is more obvious why we do. In the first instance we believe the service we operate is unique, as most firms are not truly independent. Most have an involvement with a management source and therefore they are unable to offer our kind of service. It is also a thankless and difficult job permanently keeping an eye on lettings and management operations, after all there are now in excess of 650 letting companies in the Orlando area alone!
We encourage ongoing contact with our clients by operation of a 'referral homeowners program'. This works by clients introducing friends and colleagues to us and we pay them an attractive introductory fee. We of course are obtaining additional money from more sales also. As can be seen it pays for us to look after our clients before and after the purchase!
A. No property purchase should ever be based on any expectation of capital appreciation and therefore we should answer the question by saying none at all. However it is realistic to expect some rise and therefore maybe it is best to consider what has already occurred and the current forecasts. Several forecasts by associations such as the Florida realtors predict for the next 10 years appreciation should continue at a similar rate to that of the past 10 years. Capital appreciation has averaged around 9 to 10% per annum over the past 10 years and therefore although no one has the ability to accurately predict the future, it does seem a fair assumption.
All of the information supplied within this website is provided in good faith and is based on the experience and knowledge that has been gained by the author within the "second home vacation" Florida real estate market.
Whilst it is believed to be accurate to the best of our belief, no warranty is offered and no purchase whatsoever should be made in reliance of any information provided. It is recommended that all interested parties seek independent advice about any of the information contained within this website before travelling to Florida and/or expending any finance whatsoever.