Investing in a hurricane area--questions

General Real Estate Investing
1

If anyone has experience in this:

Will you buy older rental homes that may be cheaper, or do you only newer houses that are up to the latest building standards (i.e. more expensive but less likely to be damaged)?

thanks

2

Invest when the numbers make sense and don’t worry about the property being pre or post updated building codes. Oh, and don’t forget to have hurricane coverage in your insurance policy.

3

Thanks–insurance is definitely a must (but sometimes hard to find) because I’m in Fla.

4

Yes, I too own property in FL and insurance is a deal breaker when it comes to rentals. While many mainline insurers are reducing exposure in the state and thus kicking clients to the insurer of last resort, Citizens, I have heard service and pricing is getting better. Just raise your deductible and get the loss mitigation inspection done to reduce the premium further.

5

thanks–
If you don’t mind my asking, are you able to cash flow your Florida rentals? I’m looking at the Orlando area to start my rental business (live on the gulf coast right now) .

6

I’ve owned property in the Tampa area for many years, thus low basis makes cash flow possible. Perhaps with the market adjustment over the last few years finding rentals that cash flow may be easier. Seems that insurance and RE taxes are the wild cards.

7

Thanks. Insurance seems to be a bit more reasonable in the Orlando area because it’s inland. I was thinking of looking at Seminole County, or maybe places like Clermont or Davenport.

8
Will you buy older rental homes that may be cheaper, or do you only newer houses that are up to the latest building standards (i.e. more expensive but less likely to be damaged)?

I can’t answer, i guess it really depends on the purpose why you are buying that property. Redevelop it and sell? Sell it outright?

9

This is actually a tough decision to make. I would like to know too what others think. Hurricae is a serious problem for us investors. It’s like you will be gambling your hard earned money everytime you spot a property on these areas.

10

As rental propeties (buy & hold). Sorry, I should have made that clear.

11

Well, I would say if you buy in New Orleans or Key West you are gambling. Other places are safer, but the real issue is the insurance.

12

I think the more important question is this: how much are you willing to gamble? :slight_smile: