So, you want to invest in real estate in SW Florida? Well, you have arrived at the correct place for assistance. Our team has been helping real estate investors through multiple up and down real estate markets over the past 20 years right here in beautiful Cape Coral, Florida! While some of our agents are newer they have experienced the training from our dedicated real estate broker & experienced mentor agents to help guide you to the right investment for your needs.
This article is going to address rental opportunities. I will write another article about potential remodels in another post.
Please also keep in mind that if you are finding this post in the future, it was written in the Spring of 2021 so prices and rental rules, and expectations could have changed by now. For up to the minute stats and advice always reach out directly to one of our highly trained licensed real estate agents at our office, Florida Future Realty, Inc.
We have real estate investors from beginner/novice, to experienced reaching out to us about the right rental investment for their portfolio. In this article, I am going to cover the 3 most sought-after rental opportunities we see in our current market. I hope this information assists you with deciding if our area of Cape Coral (and surrounding markets of Naples, Ft Myers Beach, Bonita Beach, Sanibel, Captiva & Ft Myers) is for you.
Most of the investors I speak with are looking for a hybrid investment model. I just made up this term because they are wishing to rent out the home (or condo) often but they would also like to use if for their own personal use as well. Most of these investors are not heavily looking into returns and are mostly interested in covering all or some of their costs. They see this as a long-term investment and may be moving down in the next few to several years as well.
Cape Coral Gulf Access Homes
Depending upon your budget in this case, I often suggest either a 3 bedroom, 2 bathroom pool home or a larger pool home on the water. Cape Coral has waterfront both with Gulf Access and also waterfront homes on what we call fresh water that do not lead out to the Gulf of Mexico. Both can be furnished to make great vacation rentals but if you are an avid boater you will want to look at homes with the easiest and quickest access out to the Gulf of Mexico. Obviously, these homes are the most expensive of them all.
At the time of writing this, homes with very quick, direct (meaning no bridges or locks to contend with) access, that are in the right location and condition to be a lucrative vacation rental are starting in the 600s and going up from there with the average cost being around $800-900k. For these prices, you can acquire a very nicely appointed vacation rental, or a home that would make a great vacation rental with some minor updates and/or furnishings. Homes in this price range are renting between $8-12,000/ month during season. Our peak season is typically described as Jan-March however many owners find themselves getting vacation rental rates as early as November and as late as through April. Our “off-season” is the summer months. While you can absolutely still rent your house out during the summer months, we find that the rates are about half of the seasonal rates and also come with a vacancy rate as well. In the summer months, it is also common to find people looking to rent for just a week or two versus in season you often have people wanting the entire 3 months or at least a full month rental.
Does this sound ideal? Get started with a search for Gulf Access Homes in Cape Coral.
Cape Coral Pool Homes - Off water
With off-water homes, you can imagine that the rental rates are not nearly as high however it can still be lucrative. A typical 3/2/2 (That’s 3 bedrooms, 2 bathrooms, and a 2 car garage) pool home that would make a nice vacation rental can be purchased for around $350-400k in today’s current market. This home can rent for about $3000-3800/month during the seasonal months (see above) depending upon location and amenities. Start searching for pool homes in Cape Coral now.
Annual Rentals in Cape Coral
The third investment I want to touch on are the annual rentals. With an annual rental, you do not have to furnish the property and you get a long-term tenant. You also save on having to pay for electricity, water, sewer & internet. We still suggest that you handle the pool & lawn maintenance though. Off water homes are usually more ideal for this as with an annual rental you are asking much less per month and with the holding costs of a higher-priced luxury waterfront home, this just doesn’t make much sense to most investors. But a nice pool home can easily rent year-round for about $2,000-2,400 in today’s market. A house without a pool can rent for about $1600-2,000. These homes, without pools, can be purchased right now for under $300,000.
In Cape Coral, Florida at the present time, the only rule for rentals is that they require a minimum of 1 week stay. They also just passed an annual registration as well to go into effect Oct 2021.
If you are looking inside of an HOA or Condo Association there will be additional rules. Many complexes do not allow rentals and most of the ones that do have stipulations in place like you can rent up to 4 times a year at a minimum of 90 days stay, etc. So each complex’s rules will need to be studied carefully.
I hope this article helps you get an idea of what our current real estate rental market in Cape Coral looks like. Obviously, this is a very broad picture and once we connect we are happy to narrow down the picture for your specific goals.