Hello Friends. As you may remember, I decided to sell both Florida rentals earlier this year. Find the backstory on my crisis here. A few months back, we successfully closed on selling rental #1 and even thought it was not long ago, it was a totally different real estate market. House #1 received multiple offers in one day and by the end of the week, the property was under contract.
House #2 has been very different. It sat on the market for one month. While it attracted multiple showings, it took 30 days to receive an offer. The buyer’s offer was less than asking and she asked for concessions. This is the market that we are now in. Although just a few months later, things are changing drastically.
Sense of Urgency
Starting last year, I felt a high sense of urgency to sell both rentals. Below are a few reasons:
1️⃣ The Florida Home Insurance Crisis: Many insurers are moving out of Florida due to the high risk of loss and fraudulent activity. Especially after this recent Hurricane Ian, I expect further exits, premium hikes and risk-averse carriers who are very selective in their underwriting.
2️⃣ Rising Interest Rates: As I have spoken about before, the Fed is in constant interest rate hike mode as it battles massive inflation. Risking tipping our economy to the edge of recession, it is a delicate balance to fight the inflation that was created by massive over printing of dollars and now that plagues our country.
Rising interest rates means rising mortgage rights; rising mortgage rates means lower prices people are willing to pay for the same home. This is why both home sales and prices are falling from their highs and will continue to do so.
3️⃣ Focus on Other Things: Now is a great time to offload my rentals at great prices for me, allowing me to take that capital and move elsewhere while no longer having the responsibiltiy (and occassional headache) of managing rentals. If you know me, you recognize the seriousness that I place on managing a rental property. In a nutshell, investors are responsible for the safety and well-being of their residents. That should not be taken lightly. Selling the second and final rental will close off a great chapter and allow me to focus on being a Dad and husband and invest in other asset classes, which i will share in future posts.
New Opportunities
There will certainly be great real estate buying opportunities in the future and as I wait for those, I will be thankful to have closed off a great season of land lording with awesome tenants. And just like our last sale, I look forward to our house being a great blessing to the next owner!
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