When considering an investment in a holiday rental, your ideal would be a high-occupancy property in a destination with 365 days a year appeal and a constant throughput of high-spending tourists. This article takes a look at how Orlando in Florida can tick all the boxes of the most demanding investor.
THE MOST POPULAR PLACE ON EARTH
For the last seven consecutive years, Orlando’s tourist numbers have been on the rise. Last year, a jaw-dropping 68 million visited the city; that’s the equivalent of the entire UK population taking a break there and bringing Cyprus with them.
These visitors spent $91bn while they were in ‘The Theme Park Capital of the World’; of TripAdvisor’s top 15 amusement parks internationally, eight are in Orlando.
It’s one of the great family destinations, but it’s not all roller coasters and candyfloss. Golfers are very well catered for, with over 180 courses accessible within the hour. Downtown Orlando offers world-class shopping and lots of it; from the highest end upmarket malls to budget outlet stores and everything in between.
Located as it is in Central Florida, Orlando is handily situated for a day trip to the Kennedy Space Center, or to the zoo and aquarium in Tampa Bay. Slightly further away but well worth the trip are the famous Everglades.
A PROSPERING CITY
Such enormous visitor numbers have a significant effect on the local economy – tourism contributes $54bn annually. This has made Orlando’s the second fastest growing in the whole of the USA.
The tourism sector creates 380,000 jobs every year (#1 in the nation in 2015) and KPMG rates it as the second most competitive city in the USA for business.
An ambitious infrastructure and quality of life programme has seen $15bn pumped into new commuter train connections, an express rail link to Miami, the region’s ring road and a full upgrade of its 2 airports, including new terminals.
SHORTAGE OF PROPERTY
With home prices currently averaging $269,000, sales in August 2017 were up 3% year on year, with the number of available properties down by 16%. Median price has increased every month for the last 74, and now stands 94.8% above the July 2011 level.
Vacation rental properties, however, must be licensed and can only be found within specified Short Term Rental Zones. This puts them at a premium and local real estate experts estimate that a rental property with pool will go for anything between $300,000 and $1m plus.
WHERE TO STAY ON VACATION?
The home of the theme park is also the home of the themed resort hotel. Owned as they are by the Disneys and Hiltons of this world, a stay in Orlando doesn’t tend to come cheap, especially for a family or a group of friends.
There are plenty of villas to rent, but these can be quite dear and car-reliant.
Much in demand but short in supply are serviced apartments, or ‘extended stay’ accommodation as they’re known in the States; they represent some of the best investment properties in Florida. First intended for business travellers to the big cities, these home-from-home multi-bedroom, multi-bathroom suites with fully equipped kitchen are increasingly popular in the leisure hospitality sector, particularly with families.
James Harrington, Business Development Manager with serviced apartment specialists Emerging Property says “Serviced apartments are bigger and better value than standard hotel rooms, and if you’re taking your family for a dream trip to a place like Orlando, you want the best accommodation you can afford. There are only 3 serviced apartment resorts in Orlando at the moment, so higher than average occupancy rates are the order of the day for investors in this property type.”