39: Almost two million people call Greater Fort Lauderdale their year-round home. But countless more come here to invest in the region’s valuable and appreciating residential real estate to buy property for rental or rental income. Whether condominiums, single-family homes, or duplexes or triplexes, the real estate around Fort Lauderdale, Pompano Beach and other coastal areas is rising in value – and investor allure. The attraction of seasonal rental property is growing.
In this blog, we’ll explore the foundations of buying and renting residential investment property anywhere along Fort Lauderdale’s Atlantic oceanfront. From the finances to the rules, some guidelines and principles can guide your way to a smart investment strategy to drive income now – and build your nest-egg for future financial security.
Why would you want to buy and rent out a South Florida waterfront condominium? The time-tested investment strategy of owning rental property comes down to dollars and sense (pun intended).
Families traveling to the Fort Lauderdale area from the Northeast – New York, New Jersey, Connecticut, or even Canada – or the Midwest, or even Europe or Latin America – can become your bankroll to pay ongoing ownership expenses.
ONE COMMUNITY FOR ANY INVESTOR
No matter your investment strategy, Broward County has it all. Some are buying homes and condominiums intending to make them the centerpiece of their retirement. Those who buy property for rentals might only do so for part of the year, instead choosing to buy a condo for seasonal use for themselves or their families, and renting it the remainder of the year.
After all, who wouldn’t want a family place to call home in a vacation paradise like South Florida? Escaping daily life, whether in the winters of New York, New Jersey, Connecticut, or even Canada, or any time of year, has drawn vacationers and real estate investors here for generations.
At The Gary Lanham Group at Coldwell Banker Fort Lauderdale Beach Office, our specialty is working closely with home and investment property buyers into coastal communities across South Florida. Sure, we know Lake Ridge, The Corals of Oakland Park, North Andrews Gardens, or Bay Colony and Wilton Manors. We’ve guided investors seeking properties in such communities as Coral Ridge Country Club, The Landings, Coral Ridge, Imperial Point, Las Olas Isles, and Santa Barbara Shores in Pompano Beach.
BUYING SEASONAL RENTAL PROPERTY
Some come to live here. Those looking to buy Florida property for rental, whether seasonal rental property or longer-term leases, need a Realtor versed in the details and nuance of the area.
Sitting with Eileen Mulkey, a Gary Lanham Group broker associate, Fannie Mae appraiser, forensic Fannie Mae appraiser who evaluates other appraisers, we recently discussed a striking Pompano Beach waterfront condominium residence and what makes life in Pompano Beach “beachfront day.”
The area around Atlantic Boulevard and A1A has seen millions of dollars in new construction and rejuvenation. New restaurants and retail shops, the family and children’s playground, the pier and new parking garage. Locals and tourists alike have been drawn to Pompano Beach. And the city, business owners, and developers are delivering significant and alluring improvements.
More than generating important revenues that the city can use to continue to improve the city, it’s elevating Pompano Beach. And seasonal rental property owners and buyers are taking notice.
Developers are delivering striking condominiums with modern new amenities. Whether for an owner-occupant or an investor hoping to buy and rent out, the condo residence we discussed was second to none. It featured a host of amenities, like a beautiful pool area, onsite gym, and social room perfect for living life well or entertaining friends and family. Its 24-hour concierge makes it a little resort getaway, even though it’s a condo.
What’s more, the valet and concierge services are ideally suited to older residents, even families with senior parents or family members who might need looking after or a little additional attention.
This building is Exhibit A in the type of property investors are looking for. Amenity-rich and built for elevated living, it’s ready to rent. A unit owner here can live in the property or rent it out immediately.
A SNAPSHOT OF TODAY’S BUYER
So, who are the people who are buying oceanfront condominiums? When the Auberge Beach Residences luxury condominium was built several years ago, developers expected to draw those northern buyers and an international clientele. To be sure, they bought at the luxury property. But many of the buyers were from right here in South Florida. People from western Broward County, places like Weston, Coral Springs, and Pembroke Pines, showed up looking for a change in life and lifestyle
They had raised their children and were now empty-nesters looking for “what’s next” in their lives. At the same time, they were also maintaining beautiful single-family homes. And they’d grown tired of the ceaseless upkeep and cost.
They were ready for a little rest and relaxation they could find in a retreat on the beach. The Auberge became the perfect opportunity for them to do write their life’s next chapter.
What’s more, some realized that they could have it both ways. Maybe they would still own that home, or downsize to something more tenable to their current life circumstance. But if they bought a beachfront condo, they could enjoy their waterfront getaway part of the year, rent it out seasonally, and generate enough rental income to offset some of their ongoing costs.
Even international buyers are finding condos to be good investments – or an opportunity to sell their units and become renters themselves. One Canadian couple we worked with were older baby boomers who didn’t want responsibility of owning their unit in Pompano Beach any longer. But they wanted to return for winter to enjoy their season down here.
So they sold their unit and now return annually to spend the season renting in Pompano Beach. Many return to the same unit; owners have the reliability and security of trusted renters, and renters have no learning curve with a new unit each year.
RULES & REALITIES OF CONDO OWNERSHIP
If you’re looking to buy a condo to rent out, what are some considerations to pay attention to? The soundness, safety, and upkeep of the building certainly are essential (we’ll get into that in a moment). What should buyers, especially those looking to rent, be looking for? Ask if the building is professionally managed. Does it have special assessments in place?
Is there any pending litigation that could cost a special assessment to you as an owner down the road.
Renting single-family homes, or duplex/triplex properties come with far fewer restrictions than renting a condominium residence. The rules aren’t arduous; many building owners and association board members are property owners themselves. Tenants must be vetted by the association board or management company.
To be clear, these reviews aren’t intended to be unduly burdensome or to restrict the chance to earn rental investment income on seasonal or longer-term leases. They’re mostly interested in keeping the building less transient, like a hotel, and more like a home community with people whose company they might enjoy.
That’s why most rental restrictions require a minimum 30-day rental. Many limit such short-term rentals to twice a year.
Those interested in seasonal rentals find real benefits. As an owner, signing tenants for two months or more dramatically reduces tenant turnover and unit fatigue that comes from higher use by more individual unit renters.
THE COSTS OF CONDO OWNERSHIP
We all know condos have rules. They also have ongoing costs. So what are the expenses of condominium ownership? They include those that all property owners must pay, like property taxes and insurance. These can be thousands of dollars each year, which must be paid regardless of whether the unit gets the highest and best use, or sits idle.
Unlike other residential properties, like single family homes, or duplexes or triplexes not within a larger planned community, condominiums have fees. Association fees, management fees, even the costs behind the annual upkeep and longer-term, 40-year review plan for the building.
What is the 40-year review plan? Built to withstand the harsh elements of sun, wind, and salty sea spray, waterfront condos still need investment to maintain their beauty and structure. So throughout the year, condominium exteriors must be refreshed with paint, landscaping, and maintained to keep a fresh appearance.
Every few years, condos must be more thoroughly attended to. This can include new paint and repairs to rust on exterior metal.
The 40-year plan is a far-longer improvement program. It addresses the installation of impact glass being installed to help prevent damage in the event of a hurricane or other tropical disturbance; upgrades to the fire alarm warning and sprinkler systems; improvements to the balconies, including the concrete flooring and metal railing; and modernization and aesthetic upgrades.
This financial obligation cannot be overlooked, but can be financially mitigated against by rental income.
Stretching back to the 1950s, Pompano Beach has been a popular destination for countless generations of tourists and South Florida residents alike. For those who know real estate in Fort Lauderdale, Pompano Beach is far different from – and a nice accompaniment to other popular areas like Las Olas, Lake Ridge, and Wilton Manors. The team at Gary Lanham Group at Coldwell Banker Fort Lauderdale Beach Office brings our expertise in all of greater Fort Lauderdale’s established and areas on the rise – like Coral Ridge, Imperial Point, Coral Ridge Isles, and Oakland Park -so buyers can make them their own.
When looking for the right waterfront or beachfront condominium in South Florida, no place is more alluring than Pompano Beach. As coastal towns go, it’s the right neighborhood that creates a strong argument for investment and retirement planning.
Nestled among Broward County, Florida’s Blue Wave Certified beaches, Pompano Beach is unique among area Atlantic coastline. The Pompano Pier serves up world-class fishing to the anglers and sightseeing for tourists from around the world.
If you’re looking for the ideal residential property to bank on as an investment, to bolster your retirement planning, to tap into South Florida’s real estate appreciation, or just to call home, our team can help you find the right home, condominium, duplex, or triplex to suit your needs.
We have our finger on the pulse across the region. We know Lake Ridge, The Corals of Oakland Park, North Andrews Gardens, or Bay Colony and Wilton Manors remain prime neighborhoods. At The Gary Lanham Group at Coldwell Banker Fort Lauderdale Beach Office, we have worked to place excited new homeowners in all these communities. We’re also experts in such areas as Coral Ridge, Coral Ridge Country Club, The Landings, Imperial Point, Coral Ridge Isles, and Oakland Park, and Santa Barbara Shores in Pompano Beach.
Gary Lanham Group at Coldwell Banker Residential Real Estate is a boutique real estate organization offering sales, leasing, and brokerage services to the Greater Fort Lauderdale area. A listings agent matches home sellers with buyers and tenants with landlords. While Broward County is our universe, we focus on Coral Ridge Country Club, Oakland Park, Wilton Manors, Pompano Beach, and the surrounding areas. Call us today at (954) 695-6518 or visit www.GaryLanhamGroup.com.