Help with buying a property in Florida

Are you thinking of buying in Florida ?

We would like to help you buy your own property in Florida

As we have gone through this ourselves we are aware of the pitfalls to avoid and the joy of closing on your own holiday home. If you are tempted to buy in Florida we would like to help you through the process of buying your own property. When buying a Florida property, there are a few things to consider to help you find your own piece of paradise within the Sunshine State!

We can help talk you through your concerns and can put you in contact with our recommended, and appropriately licenced, advisors and realtors in Florida to make the whole process easy for you.

Why do you want to buy?

If you want to purchase your own holiday home that you will be using, then you should think about what sort of holiday do you like ? That will focus your mind on location and size of property. From the attractions and theme parks of Orlando to the coastal choice of the Gulf Coast with spectacular sunsets and white sandy beaches and the Atlantic Coast with Daytona, rocket and shuttle launches from Kennedy Space Centre, nearby Cocoa Beach and Miami. If you are a golfer, Florida has hundreds of golf and country clubs, many of which offer residential or rental property on location or very nearby a fairway.

If you want to buy a property to rent out then you are probably better off looking at the areas within easy driving distance of the Orlando and Kissimmee attraction parks and of course, Disney. As the Orlando region attracts just short of 50 million visitors each year. It's simple to see why this is a great area for an investment in a rental property.

If you want a property to rent out

You have to ensure that the property is in an STR Zone. That means that the local authorities legally allow the property to be used for short term rental. The authorities also need to then inspect the property and issue an annual licence to let the property, like a hotel licence, you need to provide smoke/fire detectors, fire extinguisher, emergency lighting etc.

You also need someone to look after the property for you if you are renting it out. A local caretaker or management company, to maintain, clean and check the place inside and out. Some management companies can provide a rental service and find you guests as well. But be very wary of 'guaranteed rental schemes' and maximum occupancy claims.

What type of property to buy

Every type of property is available in Florida ranging from Condominiums to Townhouses to Full Luxury Homes. How many bedrooms, swimming pool, location etc will depend largely on the reasons why you want to buy and your budget. We can recommend the services of a fully licenced Florida realtor who is a specialist in Vacation Homes and helping the British buy their dream holiday home.

New or Resale - As our realtor is licenced they have access to all resale (previously owned) properties on the market via the multiple listing service, as well as access to all current and future new communities and developments directly with the builders. When you buy new off plan you see a plan of the development or community, select the location of your property and then select the style of building from the range that the builder has to offer at that development. They usually have a selection of showhomes showing the different styles and some offer the ability to then chose certain structural options and layouts as well as colours, tiles, worktops etc.

Our Florida realtor will be able to give you fully up-to-date availability information and pricing on new and resale properties that meet your requirements.

Finance

A US mortgage is easy to find if you wish to borrow up to 80% of the value of the property. You do need to find 20% or more to purchase in the US. You also need to have a US bank account. Both are easy to organise if you have the correct documentation and several forms of identity. Mortgages are available from US lenders and now several UK lenders are offering overseas mortgages or UK mortgages on overseas properties.

Taxation

There is a tax treaty between the UK Inland Revenue and the American Inland /revenue Service that means they talk to each other and share information. So you do not have to pay income tax twice on rental income, but you do have to declare rental income for taxation purposes once. They always get you one way or another! Florida also has a sales tax that is a bit like the UK's VAT, it currently stands at 12% that you will have to pay on all rental income if you do bookings yourself or most rental agencies or management companies will deduct this for you.

There are other annual taxes that you should be aware of such as the Property Tax, this is often paid via your mortgage provider if you have a US mortgage. The value of the properties contents also need to be declared in a Tangible Property Tax Return.

Many or most of your expenses including the mortgage interest, can be off set against any tax payable from rental income and so it is not uncommon for a tax bill to be minimal, once the expenses are taken into account.

HOA

Most of the communities in Florida, both residential and STR zoned have their own Home Owners Association. These elected boards run the community and cover things like security gates, road traffic control, local bylaws, landscaping and area upkeep and maintenance and membership of the HOA is normally mandatory. There is a monthly or annual membership fee.

Insurance

You need to fully ensure the property and make sure that if you are renting it that you have the most appropriate cover. US mortgages normally cover the repayment of your insurance premiums as well as the principal property taxes as stated above.

Closing

Closing or completing on your Florida property is done through an independent Title Company. They convey the title and they ensure that the appropriate monies are correctly distributed to all of the relevant parties and that all the paperwork, insurance, mortgage etc are in order. Closing cost are likely to amount to 4.5% of the total purchase price, your mortgage should be calculated so that these costs are covered. Closing costs are less if you are a cash buyer with no mortgage.

You do not need to be present in Florida to close on the property provided that your funds are made available to the Title Company and all the paperwork is correct and present. Documents in the sales pack can be signed and witnessed by a Notary in the UK and couriered to the US prior to the closing date.

A good realtor will have the personnel to help with the closing process, and arrange to do the walk through with the builder if you are buying a new home and cannot be there in person.

Furniture

Florida is well equipped to meet the needs of a rental or vacation home owner. Some builders include a furniture package in the final purchase price. If not then there are many companies that offer furniture packages based on the number and type of reception rooms and bedrooms that you have. You can tailor these packages to suit your own requirements. These packages include everything you need to equip the property for rental and include furniture, lighting, decorations and all the kitchen equipment and utensils.

Please note that closing costs, interest rates and rates of taxation are subject to change, as are conditions and deposits required to obtain a mortgage. Please treat the above as a guide only and you should obtain up-to-date information prior to any purchase.

Most of the advice, contacts and help that you may need, start from a good realtor.

We are happy to answer any initial questions or give share our wisdom of going through the process (good and bad experiences) or happy to put you in contact with our experienced, fully licenced and recommended realtor. We can also help with contacts for mortgages, tax accountants, furniture packages and the like.

To send us your questions or if you want to be introduced to our recommended realtor please click on the contact button below