British buy to let (BTL) investors are looking outside the UK to new destinations as UK investments are much less profitable than they used to be.
A combination of fewer or less attractive tax breaks over recent years, and now the increase in interest rates, is making BTL landlords sell up their UK homes in droves.
High amongst the new locations they are looking at is Florida with Orlando the number one target in the Sunshine State.
The perfect blend of demand, global visitors, transient renters and a business- friendly approach allows investors to take advantage of properties priced from the low $200’s that offer the types of returns that make ownership a realistic option.
Florida has always attracted global visitors, with the first quarter of 2023 seeing 37.9 million visitors - the largest volume of visitors ever recorded in a single quarter.
Florida’s economy is projected to expand in 2022 and the state has the lowest unemployment rate of the 10 largest US states.
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It makes for a good investment environment for landlords, something that is being picked up on by British buyers. “The UK investor isn’t new to us in Florida, and in particular to Orlando, we have simply seen a significant increase in the former UK BTL buyer this year with many of them making initial enquiries and buying quickly to replace a UK property that has been sold or to add to their current portfolios,” according to Alistair Brown, CEO of Alistair Brown International Real Estate.
Add to this the personal use that saves investor-owners additional holiday expenses and the value proposition gets better – why not fund your own trips with your Florida income? It works for British buyers Martin and Claire Steggles who purchased two BTL homes on the Gulf Coast.
Across Florida, there are many examples of gross yields from rental investments at or above 8%. “Unlike the UK there are significant write-offs and benefits for this investor in Florida,” adds Brown.
He points to a recent example in the Grove Resort and Waterpark condo-hotel development close to Walt Disney World and Animal Kingdom for $320,000. It’s been a highly successful resort since opening in 2017.
This two-bedroom, two-bathrooms apartment has access to a host of amenities and services as well as the Disney Transport service which runs from the resort at various times of the day. A gross annual revenue during 2022 was $60,000.
A further example is nearby from Lake Buena Vista Resort where condominiums sell from $274,000 with financing set at 4% over five years. Alternatively, there’s a two-year product for cash buyers and a guarantee of a 7% return for two years.
Located close to almost every attraction, shopping and other facilities in Orlando area this is an ideal product for the BTL buyer, says Brown. Investors who have a smaller or bigger budget can choose between options, depending on what cash flow they seek. ‘We know this market and have direct access across all products,” reports Brown. “Mortgages are readily available, in some cases at very attractive rates over a short term.”
