A rental that looks good on a listing sheet can still lose money.
Tampa Bay has drawn investors for years: steady population growth, a mix of older bungalows and new subdivisions, and rents that track a growing job market. It has also seen insurance costs rise and new condominium rules raise association fees. Both sides of that picture belong in your numbers.
David Okafor leads our investment work. Before he recommends an offer, he builds a simple underwriting sheet for the property: rent comparables from leases signed nearby, real insurance quotes, property taxes after the sale, a vacancy allowance and reserves for the roof, the air conditioning and turnover. If the numbers do not work, he will say so.
We work with first-time investors buying a single rental, owners trading up to a duplex or small building, and out-of-state buyers who want a property they will never have to visit. If you would like us to manage the property after closing, our management team can take over on day one.
How we run the numbers on a rental
Every investment property we recommend comes with a one-page sheet built on these lines.
Leases signed nearby in the last six months for similar size and condition, not the asking rents on rental sites.
Actual quotes and the tax bill as it is likely to reset after your purchase.
A monthly reserve for big-ticket replacements, based on the age of each system.
What is left each month, and the return on the cash you put in, under a realistic vacancy rate.
Financing a rental property
Loans for investment property usually ask for a larger down payment and carry a different rate than a loan for a home you live in. Some investors start with a small building they will live in for a time, which can open other financing options; others pay cash or use a loan based on the property's rent.
We introduce lenders who work with investors often, so you can compare terms before you choose a property. The financing changes the cash flow, so we run the numbers on each option rather than assuming one.
Your own tax adviser is the right person to explain depreciation, deductions and how a rental affects your return. We can share the documents they will ask for.
Reserves matter as much as the loan. Lenders for rental property often want to see several months of payments set aside after closing, and a sensible owner keeps a separate fund for vacancies and repairs. We build both into the underwriting sheet, so the property still works in the month the air conditioning fails and the unit sits empty.
The kinds of property we help investors buy
Each type has its own trade-offs. We will tell you which ones suit your goals and your time.
Detached rental homes
Simple to finance and to sell later; the most common first investment.
Duplexes and fourplexes
More income per roof and a path to owner-occupant financing on smaller buildings.
Townhomes and condos
Lower upkeep, but association rules on renting and fees need careful review.
Value-add properties
Older homes that need work, priced for it, with permits and contractors lined up.
Insurance and association rules: the costs that surprise investors
Insurance is the line that most often turns a promising rental into a weak one. Premiums depend on the roof, the age of the systems, wind protection and the flood zone, and quotes for rentals can differ from quotes for owner-occupied homes. We get real quotes before you commit, not estimates.
If the property is in an association, its rules matter as much as its fees. Some limit how often you can lease, set minimum lease lengths or require tenant approval. Recent changes in Florida condominium rules have also raised reserves and assessments in some older buildings.
We read the rules, the budget and recent minutes before you make an offer, and we note anything that could change your numbers in the year ahead. If a property does not survive that check, we say so and keep looking.
What we confirm before you make an offer
These checks have saved our investor clients from expensive surprises.
- Rental rules in the association
- Current leases and deposits
- Open permits or code cases
- Insurance quotes in hand
- Flood zone and claims history
- Roof and system ages
- Utility billing arrangements
- Realistic rent comparables
When the numbers do not work
Some of the most useful advice an investor receives is a reason not to buy. A property can look good on a listing sheet and still fall apart once real insurance quotes, a realistic vacancy rate and an honest reserve for the roof are added. When that happens, we show you the sheet and recommend you pass.
Sometimes the property is fine and the price is the problem. In that case we work out the price at which the numbers do work and, if it is reasonable, write an offer there with a clear explanation for the seller. Sellers often respond better to an offer that shows its reasoning than to a low number with none.
Patience pays in investing. Most of our investor clients look at several properties before buying one, and many tell us the ones they walked away from taught them as much as the one they bought. We keep your criteria on file and send new properties as they come up, so the search keeps moving without you having to watch it every day.
What investors want to know
Short answers on Tampa rentals. A tax adviser can model your own return. See also Rental management, Buying a home and notes for long-distance landlords.