Kissimmee FL real estate listings and homes for sale, home buying, home selling information – Cinderella Realty, Inc.

Florida Investment Properties

July 18th, 2008 12:14 PM

Hello Everyone,

I received the following questions today from a potential overseas investor, I thought you may be interested.

Questions & Response:

These are very good questions, would you mind if I post them on my web-site and blogs? I think they will help others as well. Thanks.

What is property tax? And how is this paid?

These are taxes we pay to the county we own a home in. They are assessed based on the value of your home. They are similar to the council taxes you pay for your home. They are paid once a year by the mortgage company so they are collected monthly from your mortgage company with your payment and deposited into an escrow account

With regards STR, what is the difference in zoning? I don't quite understand this.

STR stands for Short Term Rental, when a builder is permitting a new community, it must be declared and approved as a residential (meaning a min. of 7 months let) or STR (which means it can be full time residence or short term rental)

If the property is located on a resort, do we have to pay any maintenance fees?

The maintenance fees are included in the HOA fees (Home Owners Association - all the owners own the common areas collectively). These fees are based on the type of community, amenities, maintenance of the common areas, guard (if needed), club house, and the number of homes (as the total is divided amongst the owners)

Do most people use letting agents, and if so, do they tend to let the properties throughout the year or are they not reliable as there are so many rentals available?

There are many reliable management companies and just as many bad ones. We will assist you with management companies known by their reputations. Typically, the first year you should expect about 20 weeks of bookings from a management company. I advise my Buyers to do additional advertising. If an owner can supplement their rentals by 5-10 weeks, you will be in a comfortable position.

Of course, this goes along with the type of home and community. Some communities have on-site management companies and can supply more bookings. In my experience, the most successful homeowners eventually do all their own bookings, using a management company for check-in & out, cleanings, ect.. Repeat guest and referrals are more prominent when they go through you directly.

Do you have any idea of what management fees would cost annually an approx figure would be fine?

A return on investment (ROI) spreadsheet is attached below. It will give you a good idea of the monthly incoming and outgoing expenses. The management fees range based on the community. Most standard companies will charge 10-15% per their bookings but only a minimal service fee for your booking not a percentage.

I hope this helps & have a great day!

Posted by Laura A. Balko on July 18th, 2008 12:14 PM

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