Do you live in Florida? You may have noticed that our real estate market has remained red-hot, even while markets across the country have begun to peak and settle. There’s still a huge influx of people relocating to the Sunshine State, and that’s driving a continued demand for housing.
You may also have noticed that a lot of the investors looking at properties to buy around the state are not from here. They live out of state and sometimes they even live out of the country.
It’s understandable why they’d be attracted to Florida real estate. There’s a lot of money to be made here.
We believe that as local investors, we have several advantages over those who are investing from afar. In fact, you can harness local opportunities yourself, and that’s what we’re talking about today. Investing locally leads to success, especially when your local market is here in Florida.
Sure, it’s easier than ever to invest from anywhere in any market that appeals to you. As a Florida-based real estate investor, you can buy properties in Texas or Colorado or Arizona. We encourage you to invest locally for maximum success and unique benefits that only local investors can enjoy.
Let’s explore what we mean a little more.
It’s Easier to Understand the Local Market
Working with local experts in a far-away market is easy enough, and usually the necessary data can be gleaned from any location, however sometimes it’s hard to really quantify the positives and negatives of a neighborhood. You have to know it. You have to drive through it in the early morning and at night and over a long weekend. This will tell you a lot about what you need to know. Demographics, dynamics, and vibe always come through when you’re there in person.
Here’s what you can’t really know unless you have physical access to a neighborhood:
- Is there a lot of traffic at certain parts of the day?
- Do planes fly overhead, creating a nuisance?
- Are there freight trains crossing busy roads during inopportune times, holding up traffic?
- Are the lawns well-landscaped?
- Is there a lot of trash and debris gathered in the corners?
- Do people tend to speed through the streets?
- Are there a lot of cars, or is it a walkable area? Are there sidewalks?
Local market knowledge can be personal and allow for a depth that other investors won’t be able to access. This knowledge can even translate to equity increases. When you live in an area in which you also rent out homes, you’ll know what’s going on with an abandoned building. You’ll know if a new coffee shop is preparing to open and how that will impact your property value. Is there more new construction housing coming into the area? Are people leaving for other, more desirable communities? Having first-hand knowledge of these things will allow you to take the temperature of the market without studying spreadsheets and data. That information certainly has its value, but when you don’t have to do as much research, you can save some time. Being a local investor also allows you to be part of the community discussion around what’s happening in your area.
You Have a Seat at the Table
As a local investor, you won’t just know what’s happening in the market, you’ll have an opportunity to influence what’s happening in the market.
Florida politics can be interesting to follow, and luckily this area remains a relatively landlord-friendly state. However, if something is proposed that raises an alarm bell, a local investor is uniquely positioned to do something about it. We know that rent control is unlikely to become possible; our state constitution prohibits it. But, that doesn’t mean there aren’t legislators and advocacy groups who consistently try to change the laws towards more tenant-friendly directions.
As an investor who lives and invests in Florida, you can be here to protect your own interests and to contribute to the growth of the industry in general.
You can contribute to the discussion around development, public transportation, environmental regulations and requirements, and smart growth management. You and your rental business will be impacted by decisions made over schools, commercial properties, zoning, and building.
It’s hard to make your voice heard from across the country. Because you’re here, you can attend meetings and write op-eds, and lobby for effective change.
You can also vote in local elections. You’re paying local taxes and supporting the local economy with your rental properties. Make sure you’re available to talk about the issues that will directly impact your rental business. This matters more than ever.
Vendor Relationships and Local Partnerships
Finding reliable vendors isn’t as easy as it once was. Twenty years ago, you could get a referral from someone you trusted or even make a cold call, and you’d have a fantastic plumber, drywall expert, or HVAC tech ready to do the job you needed. Now, thanks to higher demand for this kind of work but a lower labor supply, finding vendors who can do work quickly, affordably, and to your standards can be a bit of a challenge.
Solid relationships are required, and it’s difficult to establish those relationships when you’re investing from elsewhere. As a local investor, however, you can take the time to work on such a relationship. You can provide a steady volume of work and put things into place that ensure you’ll always have someone ready to take care of anything you need at your rental property.
There’s a lot of value in that, especially now, when vendors can essentially pick and choose which projects they’re going to take on.
You will need a Realtor, general contractor, handyman, landscaper, electrician, plumber, and a strong set of cleaners in order to succeed as a real estate investor. You’ll also need a local attorney you can call with questions and an expert in finance and taxes. You cannot possibly do everything yourself when it comes to investing in rental property. By growing your portfolio with properties in your local area, you can create and cultivate a fantastic vendor list.
It’s also a single vendor list. But, if you spread your investment properties around the country, you’ll need a list of reliable vendors in every area. That’s a lot.
The relationship you’re able to establish with your preferred vendors is about more than ease and efficiency. It’s also about expertise and service. When you hire a landscaping team who takes care of the lawn at three or four of your properties, that team is going to care about you and what you need. You can leverage their best rates, especially as you continue adding properties for them to take care of.
Remaining Hands-On During Turnovers and Major Work
We often recommend professional property management to real estate investors so that they can leave all of the day-to-day management to their experienced partners. Why spend your time running from property to property, overseeing what a management company can do for you?
It’s understandable, however, that many investors prefer to remain hands-on. They like to be active participants in how their investment properties perform, especially if there’s a major project that needs supervision or a turnover that’s likely to include improvements and renovations.
When you invest locally, you can be physically present for these things.
You might still elect to leave all of this in the capable hands of your property manager. It leaves you more time to focus on your future and what you want to do with your assets. But, if you want to take a walk through your property before and after it’s remodeled or you want to be on hand when carpets are pulled up and hard surface floors are installed, you can do that with a local real estate investment.
There’s also the potential for emergencies and catastrophes. Maybe it will make you feel better to be on-site when something happens. There are always tropical storm warnings and hurricane fears to work through, especially on the Florida coast. When you know a bad storm is approaching, your local presence will make it easy for you to communicate with tenants, follow the latest news and evacuation orders, and take care of your property.
This can be great for your own peace of mind as well as for the way that you protect your investments.
Whether it’s deciding about replacing versus repairing appliances, installing new trees, or putting up some hurricane shutters, your ability to get to your rental property quickly will be a huge benefit to you as a property owner. If you want a project to go smoothly, you need to be present.
This does not mean you have to completely avoid out-of-state investing. You might find an opportunity that’s impossible to turn down. Your own investment goals will drive where and how you invest.
Our recommendation, however, is to purchase at least a few properties locally, so you can take advantage of the fantastic market we have right here, and so you can see if you’re able to earn more money on those investments that you’re physically close to.
We’d love to consult with you on this. Please contact us at Anchor Down Real Estate & Rentals.
