I’ve been working with landlords and tenants for the entire time I’ve lived in Florida – that goes back to 1997. In that time I have met many people who are, or want to be landlords and of course tons of great tenants. For those people that want to be landlords for the first time I always suggest entering the landlord role with a little bit of caution and with a lot of professional management help because contrary to popular belief, being a landlord is not simple. Even managing just one property can actually become a job requiring many hours of work should things you are not prepared for happen; and happen they do!
In the mid-1990s most South Florida landlords were in the landlord role as a byproduct or a sideline – a necessary duty that had to be performed while they awaited the days and months to tick away as their property appreciated to a level where a sale could deliver them a tidy return on their original investment. Being a South Florida landlord 15 years ago may have been a money loser or maybe a break even proposition after mortgage, interest, taxes, insurance, repairs, commissions and vacancy, etc. Today in the mid-2010s the economics have changed! Now the astute investor with the right property can make a very reasonable return from rental revenue alone while any future value appreciation can be counted as an additional bonus for a future day!
What caused this amazing calculation shift you ask? The answer is the South Florida real estate market value reset in 2007-2009. Prior to that a return on a real estate investment could be only be made with a quick buy/hold/sell cycle to capture the accumulated appreciation of South Florida’s relatively rapidly escalating values market. In fact during the red hot escalating values market of 2007 and prior – capturing equity by moving your property on to the next buyer was just the status quo and many thought it would not end; but like a terrible game of musical chairs end it did and badly for many.
I am happy to report that the game of musical chairs is by and large a distant memory. South Florida Realty Management currently has the pleasure of doing business with multiple real estate investors owning a single rental property to 10s of rental or commercial properties. The vast majority of them are making excellent total returns on their investment of cash and time as a landlord – and the value appreciation their properties are experiencing is just a future BONUS – not their sole vehicle for growth.
Is being a landlord simple? Can anyone do it? Is it for everybody? Of course the answer must be no. Being a landlord takes money, knowledge and time.
South Florida Realty Management can’t help you with the money or the time but we specialize in the “knowledge”. We assist real estate investors as they acquire income producing residential and commercial real estate right here on South Florida’s Treasure Coast! Why not let us put our knowledge to work for you today? Give us a call or an email so we can show you how. And don’t forget to subscribe to our BLOG where we will continue our effort to deliver the tips and tricks that are essential for landlord and tenant success!