Investing in Miami Beach real estate can be your gateway to wealth. Not only are its rental rates higher than in greater Florida, but it also provides a picture-perfect backdrop that draws in high-net-worth individuals or HNWIs from all over the country year after year. In this article, we tackle why Miami Beach is one of the best places to invest in real estate, and share a few tips on how to make that investment work for you.
Why Miami Beach Is a Great Place to Invest
Many real estate investors consider Miami Beach as one of the most favorable markets in Florida. From its less strict landlord-tenant laws to its reasonably priced upscale properties, let’s take a look at why Miami Beach is a market you have to invest in.
#1 Greater Miami Attracts Tourists
Tourists troop to greater Miami every year for various reasons, but the number one reason is that it’s the perfect place for a vacation. Pre-pandemic, greater Miami saw around 24.2 million visitors, with Miami Beach being the go-to destination among overnight visitors. This is according to data from the 2019 Visitor Industry Overview. Considering this statistic, Miami Beach would be the ideal place to buy short-term rentals or to build rental properties for tourists to stay in.
#2 Miami Is Advantageous to Landlords
Compared to other states, Miami is more lenient when it comes to eviction laws. Miami landlords can evict tenants who commit violations within fifteen days of serving them a three-day notice – a significantly shorter period compared to states such as California. Miami also puts no cap on the amount of security deposit. This means you can set your security deposit – as long as it’s reasonable, otherwise, no one will want to rent your property.
#3 Miami Provides People an Escape
Miami, particularly Miami Beach, is best-known for its world-class shopping, dining, nightlife, and the list goes on! What’s more, Miami has warm weather all year round, as well as sandy shores and gorgeous views of the water. Because of the kind of life it offers, many wealthy individuals visit Miami Beach every year to unwind.
#4 Luxury Properties Are Generally Affordable
Luxury real estate isn’t as expensive in Miami as it is in other states. For $2 million, you can purchase an upscale property with waterfront views. For comparison, you’d only get a small single-family home for that amount in Los Angeles. This means that even if you’re starting with low capital, you can still purchase upscale properties for VIP clients who are relocating to Florida. Waterfront condominiums, in particular, are known to perform exceptionally well as real estate investments. This is because they can be rented to both professionals as well as travelers who want to experience luxury.
Pro Tip: Luxury properties are more demanding than “ordinary” properties, so make sure to partner with a luxury property management company. They’ll know how to take care of your real estate investment, considering the one-of-a-kind features it may have.
#5 More Renters Than Homeowners in Miami
According to RentCafe, 70 percent of the homes in Miami are renter-occupied while 30 percent are owner-occupied. Since there are more renters than homeowners, it’s the ideal place to purchase rental properties as there’s a steady demand for them. A property management agent can point you to the best Miami Beach neighborhoods to invest in, depending on your investment goals. They also have vast connections and can help you purchase properties in some of the best (and most expensive) areas in Miami Beach, such as South of Fifth and La Gorce.
#6 High Real Estate Appreciation
Miami Beach real estate can be a lucrative long-term investment, as property values tend to appreciate faster in this area. According to Fortune Builders, the one-year appreciation rate is about 20.1 percent.
#7 High Rental Rate
Miami Beach’s rental rates are also higher than the national average at $2,770 according to RentCafe. This means that you can earn more money, but do keep in mind that you’ll still need to account for maintenance and repair costs. If you aren’t familiar with the prices of third-party services such as plumbers, contractors, etc. consult with the best property management company in Miami to do the work.
Tips for Miami Beach Landlords
Now that you know why Miami Beach is such a popular place to invest in, you may be considering buying real estate in this coastal resort city. If you do decide to become a Miami Beach landlord, here are a couple of tips to keep in mind to make sure you profit from it:
#1 Hire a Miami Beach Property Management Company
If you’re buying a Miami Beach property but you don’t live in Miami Beach, consider hiring a good property management company. They can handle all of the typical landlord to-dos such as collecting rent, screening tenants, conducting repairs and maintenance, and more. They’ll be on-site to deal with any problems that may arise.
Although property management is an additional cost, it will be worth it in the end. Property managers can save you from the trouble of figuring out the Miami Beach market and can save you a lot of money in the long term.
Investors who are renting out their properties for the short term can benefit from their services, as well. Since short-term properties deal with vacancy after vacancy, it helps to have a vacation property management company to help find replacement tenants fast.
#2 Purchase the Right Property
One of the most important things to do when buying a Miami Beach property is to purchase the right property. While it’s true that many of Miami Beach’s locations are beautiful, don’t forget to put “rentability” as your number one deciding factor. Even if the area is attractive, if it doesn’t have the amenities that tenants want, you won’t be able to rent it out. Be on the lookout for neighborhoods that are in a good school district, and are near shopping centers, restaurants, etc., among others.
#3 Draft a Detailed Lease Agreement
Never let a tenant into your rental if they haven’t signed a lease agreement. It’s very important to have a detailed lease agreement that outlines what each party expects from the other. More importantly, your lease agreement should state when rent is due, otherwise, you’ll end up dealing with late rent month after month. A lease agreement protects you, your property, and your tenants from disputes, court cases, and more, so be sure to exercise caution and be as detailed as possible when drafting it. It would be best to have a professional prepare it for you.
Before You Invest in Miami Beach Real Estate
It can be tempting to be a Miami Beach landlord, but before buying your first property, consult an investment expert at Luxury Property Care. Our property managers have been in the business for years, and have gained a wealth of experience to identify which properties are worth your time, money, and energy. Call us at (561) 944 – 2992 or complete our contact form to schedule a one-on-one consultation today.