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Residential Rental Property: Condo or Single-family Home

“I want to invest in a residential rental property. Should I rent a condo or a single-family home?”

For first-time real estate investors, it’s easy to get overwhelmed by the high-impact decisions that accompany real estate investments. And, like most responses to higher risk questions, the answer is often, “Well, it depends.”

When it comes to real estate, there are multiple market factors to consider prior to purchasing a rental property — location, market trends, health of the home, investment goals, investment risk. We encourage you to schedule a free consultation for more personalized guidance. In the meantime, here are a few general benefits of residential condo and single-family home rental properties for you to consider.

 

first-time real estate investing condo VS home

Residential Single-Family Home Rental (SFH)

  • No Association Fees: In general, condos come with monthly or annual membership fees and special assessments. Both are subject to increases, thus increasing your cost to rent.
  • No Restrictions on Use: Condo rules may restrict, or set guidelines, on how you use your property. This can make it difficult, or prohibitive, for you to rent your condo. Homes for sale, not within a community, do not have to abide by the strict rules of an HOA, thus making it easier to rent.
  • Appreciation Potential: In general, the recurring costs associated with a condo can negate much of the financial gain of appreciation. SFH’s have the potential to experience greater appreciation over time, given that the market factors mentioned above are in your favor.

Residential Condo Rental

  • Undervalued Units: Properties for sale lower than the assessment value can present an opportunity for a first-time real estate investor to obtain an affordable, lower maintenance asset that will appreciate more quickly.
  • Cheaper to Acquire: As a new investor, you may be searching for a more affordable purchase. In general, condos are cheaper than SFH’s. However, you will be responsible for the HOA fees and regulations. Tenant-screening is also important because you are responsible for ensuring that your tenants also abide by the rules.
  • Less Maintenance: Traditionally, the benefits of the HOA fees include not having to mow the grass or maintain the exterior of the building. With a SFH, the burden of home maintenance is generally shared between renter and homeowner.

Within the Naples Area in April 2019, we saw:

  • 11% YOY drop in overall inventory
  • Condo sales were up 20% YOY
  • SFH sales were up 4% YOY
  • Median close price was $340,000, down 6%

Approximately 26% of those living in Collier County are renting — roughly 97,000 people.
How many of the 97,000 will be your future tenants?

 

Contact us today to learn more about getting started in the Collier County Real Estate investor community.

 

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Resources:
https://datausa.io/profile/geo/collier-county-fl/#housing
https://www.nabor.com/marketstats

How to Market Your Rental Listing

With a busy season ahead as many families prefer to move during summer once schools out, April is the perfect month to share some of the FAQ we receive from new investors asking about the home rental marketing process.

How do you find home rental tenants?

Through modern and traditional marketing techniques. Automated property listings post vacancies to hundreds of sites including Zillow, Trulia and Rentals.com ensuring the maximum exposure for your listing. By 2022, it’s expected that 81% of the U.S. population will use a smartphone and the number of mobile-only internet users will increase by 12%—that’s why we invest in mobile-friendly online technologies for you and your residents.

How do you manage a rental property, exactly?

We manage the day-to-day operations of home rental—this includes:

  • Tenant Application and Approval Process
  • Rental Price Market Research
  • Collecting Rent
  • Late Rent Notices
  • Repair Oversight
  • Early Lease Terminations
  • Monthly Accounting
  • 24-Hour Emergency Line
  • Insufficient Funds Payments
  • Routine Maintenance
  • Unauthorized Pets
  • All Charges Verified
  • Regular Inspections
  • Evictions
  • Neighbor/HOA Complaints

How do you protect my investment?

Through competitive rental pricing recommendations, home inspections and repairs. We research local market rental prices of similar properties and offer data-based listing price recommendations to maximize your profits while remaining competitive year after year. Home inspections take place before signing any contract, this includes: before you sign with us, before a tenant moves in, after a tenant leaves, as well as quarterly inspections, or as needed. We assess damage, preventable maintenance, plumbing, electrical, overall status and more. Expect detailed reports with photographs of each room in the property. For repairs, a highly-skilled in-house maintenance technician handles your quick repairs at discounted prices. Through strong vendor relationships, we’re able to offer highly competitive rates on maintenance issues that require outsourcing to a specialist. We offer real-time updates throughout the repair.

When do I get paid? How much commission do you keep?

We provide monthly financial reporting. Bookkeeping staff will provide you with month-end statements for your rental income and expenses. Year-end 1099’s and an annual statement will also be provided. Rent proceeds are processed by the 10th of the month. Proceeds are either directly deposited in your account or mailed to you each month. Our fees are fair and competitive, you receive 85-90% of the profits each month (subject to maintenance and repair fees). Please use the information provided on this website to contact us for more information.

 

Gulf Coast Management Group provides property management services to Naples, Marco Island, Estero, Bonita Springs and Fort Myers, Florida.  If you’re expanding your business or would like to start investing in real estate, GCMG can guide you through our owner’s program, call us today at 239-325-4300

Are You Buying the Right Home for Renters?

How to Rent My Home Naples

Many home owners dream of turning their first home into an investment property for passive income. Others are buying a home with direct intent to rent. In both scenarios, consider reaching out to a property management company to help ensure you’re setting yourself up for success—prior to making a commitment on a home. Gulf Coast Management Group offers free consultation and home rental evaluation services. The value of talking to an experienced property manager could make all the difference.

Two items to consider when purchasing a home with intent to rent:

Simple Landscaping

Consider homes that don’t require a lot of landscaping maintenance for you, or your renters. In most Southwest Florida neighborhoods, it’s common to expect renters to mow their grass. However, you can’t expect all renters to want to keep up with planting seasonal flowers or keeping the weeds out of huge plant beds. Keep it simple.

Major Updates Completed

Most homes in the area priced $150,000 and below will traditionally need some work—you can expect outdated kitchens and bathrooms, old carpet and few modern upgrades. Generally speaking, a fresh coat of paint, new floors and needed repairs are the most popular investments that prepare a home for renters.

With that being said, there are a few updates that can reduce the likelihood of depleting your rental property emergency fund right away. Give greater priority to the homes that have newer roofs and HVAC systems. The idea is to avoid large repair and maintenance expenses right up front. If you are considering an older home with an old roof and HVAC system, the home itself should be a great deal with clear signs of a return on investment following upgrades.

 

Schedule Your Free Consultation and Home Rental Evaluation.

Naples Area Ranks Happiest and Healthiest City in U.S.

Naples, Immokalee, and Marco Island, Florida are collectively ranked the Happiest and Healthiest city in the U.S. for the third year in a row by a Gallup-Sharecare Well-Being Index! Not only do the cities share the success of being #1 three years in a row, they are also the first community to rank in the Top Two for all the well-being elements used to determine the rankings. The Gallup report was based on five elements:

  • Physical Health
  • Social Ties
  • Financial Security
  • Community
  • Sense of Purpose

 Family Naples Florida Real Estate

Worth mentioning, Naples, Florida participates in the Blue Zones Project, a community-wide well-being improvement initiative to help make healthy choices easier for everyone in Southwest Florida. Many of the restaurants, businesses and schools in Naples have achieved the status of Blue Zones Project Approved.

Other recent awards in 2016 and 2017 for Naples, Florida are:

  • #11 “Happiest City in the U.S.” by National Geographic
  • “Best Beach Town To Live In” by WalletHub
  • Ranked in the Top 10 “Best Adventure Travel Destination in the United States” by U.S. Tourism Quality Index
  • 3rd in “America’s Favorite Beach Towns” by Travel Leisure
  • 8th “Best Big City” in the U.S. by Condé Nast Traveler
  • Awarded a 2017 Readers’ Choice Award by ConventionSouth

Schedule a free consultation to learn more about real estate investments in the Happiest and Healthiest City in the U.S.

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Collier County Could Face Stricter Short-Term Rental Regulations

On Monday, the Collier County Tourist Development Council voted that county staff take a deeper look at the rules and regulations of vacation homes and condos for rent within the local area.  This proposal comes on the heels of rising noise complaints, concern for the viability and health of Collier County neighborhoods, as well as the impact low-priced, “for rent by owner” vacation rentals may have on the local economy.  The study may aim to review whether rental owners are paying tourist taxes, and the impacts of short-term rentals on the Naples hotel industry.  “If you’re renting a private dwelling and if you don’t even have a fire extinguisher and a fire breaks out, people are going to be injured or killed, and it’s inevitable, unfortunately… That’s a major risk.” said Council member Clark Hill, general manager of the Hilton Naples.

One council member shared that he would rather see the current ordinances enforced prior to adding additional regulation.  For example, in many of the residential areas outside of city limits, owners are not allowed to rent their homes for less than six months.  Before listing your residential rental property independently, weigh out the pros and cons of choosing to list a vacation rental or annual rental. Leverage an experienced property management company like Gulf Coast Management Group.  Be sure that you understand the environment, regulations, and responsibilities required of you.  Annual property management is our specialty, call us for a free consultation, 239-325-4300.

 

Contact Us for more information on real estate investment opportunities in Southwest Florida.

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Build Out Your Investment Portfolio with Annual Rentals

Naples Property Investment Opportunities

Fort Myers and Cape Coral, Florida recently came in at #2 fastest growing cities in Florida this year. We weren’t surprised. We have seen the recent surge in economic activity in our region. With Fort Myers boasting a population growth rate of 3.48% (which is higher than Orlando, St. Petersburg, and Tampa) Fort Myers shows no signs of slowing down any time soon as visitors continue to become residents.

In 2017, Lee County attracted 4.8 million visitors. Two-thirds stayed in paid accommodations and enjoyed visiting the beaches, dining out, relaxing, swimming, and shopping. In the United States, vacation rentals are now projected to reach $36.6 billion by the end of 2018.

Vacation and annual home rentals can be a lucrative investment for both domestic and international buyers. Investors, consider the following:

 

Think Long-Term

Investing in vacation and annual rental homes is just like investing in any other real estate venture—it’s generally a long-term investment—think 5+ years. Perhaps even consider it something you pass on to a family member or child, depending on your goals and objectives.

 

Location, Location

Areas like Fort Myers, Cape Coral, Sanibel Island, and Naples are consistently topping charts as some of the best cities to visit in Florida. Home prices have still not reached the point where they were before the financial crisis. So, the argument is that Southwest Florida is both a stable market and one expected to grow. There is opportunity for investors to take advantage of the prices in conjunction with the population and visitor growth.

 

Appearance Matters

If you’re buying a home to rent to vacationers, the home quality and décor is VITAL to your long-term success. Your guests need to pull into the drive, open the front door, and FEEL like they’re on vacation. Here’s why:

  • 74% of visitors to Lee County are returning visitors
  • 85% said their purpose for visiting was to vacation
  • Only a mere 40% said the quality of their accommodation exceeded or far exceeded their expectation

Only 40%—hello opportunity! Consumers have too many choices in vacation rental options—make yours one that they return to year after year.

 

The Right Management Company is Everything

As the service provider for the rental of your property, a management company can be the make or break of the success of your vacation and annual home rental property. You want to check your bank account each month and trust that your rental funds have been auto-deposited on time. Look for a company that has compelling and consistent marketing across multiple digital platforms.

Ask them how they will market your listing and their turnaround time!

As prices and demand continue to increase in Southwest Florida, investors have the opportunity to benefit from annual yields and future capital gains.

 

Contact Us for more information on real estate investment opportunities in Southwest Florida.

 

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WE’RE GROWING!

 

GULF COAST MANAGEMENT GROUP WELCOMES PATTY BRAWNER

We are so excited to announce that our Gulf Coast Management Group team is growing!

Patty Brawner joins us as a Licensed Real Estate Agent who has focused her career as a property manager. She comes with experience in both seasonal and annual property leasing, as well as large, luxury community property management. As a member of our team, Patty will focus on customer relations and property management. We are proud to have her with us to continue the Gulf Coast Management Group legacy of building long-lasting relationships through individual attention and high-quality service. Our goal is to provide peace of mind to our valued investor owners when it comes to the management of their investment properties.

Reach out at 239-325-4300, or by email at Patty@gcmg.biz, and join us in welcoming Patty to the Gulf Coast Management Team.

Nabor Market Report

First Quarter Housing Market Activity Sets Stage for Strong Year

Excerpts from First Quarter Naples Area Board of Realtors Market Activity

Tourism was up in our area this season compared to last year so it is not surprising that we would end with strong pending sales for the quarter,” said Kathy Zorn, President/Owner, Better Homes and Gardens Real Estate Pristine. “But I wasn’t expecting to see a 109 percent increase during the quarter in pending sales for condominiums over $2 million!”

There are very good investment opportunities in the condominium market, especially at both ends of the market,” added Coco Amar, a managing broker at John R. Wood Properties. “The top and bottom price categories are where both the inventory has grown and the prices have dropped.”

As reflected in the market’s year-ending statistics (12-months ending 1Q 2018 versus 12-months ending 1Q 2017), there was a 69 percent increase in closed sales of condominiums in the $2 million and above market, and a 17 percent decrease in its median closed price to $2,450,000 from $2,962,000 in 2017. Despite rocket sales in this high-end sector during the first quarter of 2018 (179 percent increase) and a drop in median closed prices for the first quarter (24 percent decrease), its inventory increased 5 percent! Similarly, median closed prices for condominiums in the $300,000 and below price category dropped 1 percent to $199,000 from $200,000 in the first quarter of 2017, but inventory increased 3 percent.