potential newby

[Bo Radley]

Well, I was about to fly out next week and buy a property. Then I found this sight. It really is an eye opener. In the last hour I've decided to
1] change my £ to $ bank it in the US wait 12 months then buy in a falling market.
2] forget the whole idea
3] buy older rather than new
4] forget the whole idea
5] go for it
6] buy on the coast
I'm not looking to make a killing. I love the the place and want to winter there when I retire in 10 years time but I can't afford the costs without assistance from rental income. All that I've read tonight tells me I won't even break even but surely that depends on so many different factors for example somebody with a deposit of 75% is going to find easier to cover costs than with 20%. Can anybody give me rough income figures in $ for a 4 bed within the magic 15
minutes. Or any other suggestions would be appreciated. [msnscared]

Colin

[blott]

Hi Bo Radley

Welcome to the forum!

As you've probably gathered by now, it's pretty easy to work out the rental income - take a look at some comparable homes to the type you're thinking of purchasing on the websites and work it out! It depends how hard you're prepared to work as to how many bookings you achieve but work on 2-3 hours each day for obtaining your own bookings - this is the way you have the best chance of maximising your income.

It's not necessarily the income, it's the expenses you should be looking at as, if you have no bookings for a particular period, then the expenses just relentlessly carry on and will need to be met, out of your own pocket.

If someone is going to put down a deposit of more than the minimum of 20 - 30% (depending on which mortgage you get) then of course there are less expenses to cover but... you need also to take into account the interest or return on that money in your deposit that you could have had if you'd decided to do something else with it.

I think you'll find that homes on the Gulf Coast are more expensive to purchase than those in the Orlando area. They rent for higher money but you'll have higher mortgage costs to cover. Choose the area you want to have a home, particularly if you're intending to spend longer periods there.

Sorry, I can't make up your mind for you. You sound as if you're wavering at the moment and, unless you're 110% sure that you can afford this, then my advice would be not to do it. If you can afford it, then you sound as if you're looking into a long term investment where you may be able to cover your costs.

Just make sure that you go into the whole thing thoroughly before you purchase anything at all and, most important of all, ensure that you have six months of expenses in a contingency fund which you're prepared to top up as and when necessary for your 'fall back' situation.

[jeffc]

all the things blott says is fact you have to do your home work correctly the same as in any business..

the main thing you have to decide is the what you want to do with YOUR MONEY its going to be your success or failure the people on this or other sites can only advise our our experiences some good and some bad..

the main thing i would say is come and spend a nice fact finding hoilday looking for potential homes both new and resale in all areas.

then continue with your home work looking at sites like this then take the plunge when you feel ready.

good hunting.....

[esprit]

Obviously if you have only a small mortgage, it will be easier for you. Income depends on the number of weeks you let ( and at what rate obviously+. I have always done quite well and managed to let in the high 30s low 40 weeks per year. That is because I put hours and hours in on the internet. It is more than just a hobby, it is a way of life and if you let up for a moment, your renting average falls. Anyone thinking of buying should be aware of the work involved. Those who dont wnat to do the work and expect others to do the work for them are the ones who fall by the wayside and end up dumping their homes on the market smartish as the bills start to come in and panic sets in. Ask yourself if you have the commitment. If you have, then go for it. Ten years is a long way off though. I know of very few people who bought when I did seven years ago who still own their homes. never mind ten years.

[steph_goodrum]

What you also have to remember if you have a smaller mortgage is that although it may make it easier to break even it also gives you less of a deductible for your tax returns so could put you in the situation of making a profit and having to pay tax on it. If you make a loss in the tax years when you come to sell the property any losses are rolled over and offset against the eqwuivalent Capital Gains tax you may otherwise have to pay, so there could be a case for having a slightly larger mortgage and more in reserve in case you do need to top up your fund.