Is it a good time to rent a vacation home if you own one in Orlando? In other words, can we give a sense of the overall vacation home market in Central Florida? The answer is very simple – No.
However, we did discover a recent Wall Street Journal article entitled “Are You Ready to Be a Landlord” that covered the ins/outs of owning real estate from a landlord perspective. This article covered many of the opportunities and risks.
Current Opportunities
- Opportunity costs are low – Many domestic and international markets are quite volatile in today’s environment. The investment expectations for other potential asset classes are quite low.
- Interest rates – Interest rates, assuming you have good credit, are hovering around all-time lows. However, origination fees and interest rates tend to run a half point higher for second homes than for primary residences.
Current Risks
- Rental Vacancies – It still takes a savvy owner or property management company to rent your vacation home. There has never been more competition for vacation rentals in Central Florida. The inability to actively market your vacation home rental could lower your return.
- Unplanned Costs – No matter how smart and prepared you are, there will always be some blutterbunging expenses that pop out of nowhere. If you are looking for more details on vacation home break-even analysis basics you can see our previous post.
- Calculating Rental Revenues – It is very smart to realistically assess your potential revenue sources from your vacation rental. Overly optimistic estimates almost always lead to investment returns below your expectations.
If you are looking at potentially renting or purchasing a vacation home in Orlando or the Central Florida market in general, always do your homework and use professionals that are independent. There are plenty of opportunities, but there are also risks involved.
One additional nice thing about finding a vacation home rental property in Orlando is the fact there are dozens of high quality neighborhoods such as Encantada Resort Kissimmee, Hampton Lakes Davenport, and Emerald Island are within minutes of major theme parks and attractions. Over 80 vacation home rental communities are profiled on our home page including information on location, amenities, driving distances and community facilities.
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