Southwest Florida Duplex REO Investing

Although Southwest Florida may be the brunt of all real estate jokes, it is no secret that the amenities the area has to offer must rank in the top 10 of the country.  Where else can you find world reknown beaches, Sanibel and Captiva Islands, top notch shopping, dining, and entertainment, and best of all half priced real estate from neighboring Miami. 

All that said, it is expected by CNN Money that Southwest Florida's real estate market could conceivably be the first busted market to rebound, more importantly rebound the quickest.  Today, one can purchase real estate owned (REO) property for pennies on the dollar.  Literally!  A single family home in Cape Coral purchased in 2006 for $250,000 now has a foreclosure price of barely $100,000.  You do the numbers.  Single family homes are renting for about $1,000 per month and duplexes are renting at about $750 per side on a monthly basis.  A duplex in Lehigh Acres, whose notes in 2006 were in the $300,000 range can now be had in the low to mid $100's, of course depending on who you know. 

Due to the difficulties in logistics and contractual language of short sale purchases, REO investing is much easier and cleaner.  The duplexes pictured below are typical duplexes you will see available from us.  Almost all of them are built with concrete and steel allowing for more aggressively priced insurance and none of them are in any type of flood plain.  Take a look at one of our most recent closings.  This financing was a customer who opted for an 80% loan so a 20% down deposit was made.  The nice thing is that duplexes on the open market are selling at higher prices so in perhaps 6-12 months, you can acheive a cash out refinance to recapture your down payment and quite possibly have a lower loan to value than 80%, the most beneficial percentage.

Recently Purchased:       $145,000

Down Payment:                  $29,000

Principal Loan Amt:         $116,000

Mortgage Payment:               $725

Taxes/Insurance:                   $285

Prop. Mgmt                             $120

Total Due:                             $1,125

Duplex was rented at $700 per side or $1,400 total, creating a positive cash flow after all operating expenses of $275 per month.

This was the duplex sold.  Very good condition

Please fill out the form below to contact me, Scott Allan directly or visit our blog where we update the Florida foreclosure market on a regular basis.