Take advantage of the reviving tourism industry by finding the best Airbnb properties for sale in Florida. This guide will show you how.
Airbnb investment properties have always earned high returns. But ever since the pandemic, many investors have either sold their Airbnb rentals or switched their strategy to a traditional lease. Thankfully, the tourism sector is slowly recovering, with Florida leading the way. As more travelers visit the Sunshine State, Airbnbs and other short-term rentals are seeing an increase in bookings.
Whether you are a beginner real estate investor or an experienced one, 2022 is an optimistic year to expand your portfolio and invest in an Airbnb, specifically in Florida. To help you prepare, we are sharing everything you need to know about the Florida real estate investment market:
- Why you should start an Airbnb in Florida this coming year
- The state’s regulations on Airbnb and other short-term rentals
- How to find a lucrative Airbnb investment in the Florida housing market
- The five best cities in Florida to buy an Airbnb investment property
If you need help on finding a profitable investment out of the many Florida houses for sale, keep reading.
Why Start an Airbnb in Florida in 2022
Since Airbnb started in 2008, travelers have favored vacation rentals like Airbnb over hotels for their accessibility and homey experiences. This has led to many taking advantage of this profitable opportunity to find Airbnb investment properties. But is this still the same today?
The COVID-19 pandemic and subsequent lockdowns hit the tourism sector everywhere. However, Florida has made a quick comeback and is seeing record numbers of tourists, both from within the state and out, compared to other states in the US. This is because Governor DeSantis encouraged Floridians to travel within the state.
Disney World in Orlando also continues to press forward by increasing its capacity as more and more tourists show their desire to go out. This has led to short-term rentals near the theme park getting fully booked. Airbnbs in other Floridian cities is seeing an increase in bookings as well.
As more people get vaccinated and become more comfortable with traveling, tourist hotspots in Florida will welcome more people next year. Using Mashvisor’s data, we found that the Airbnb occupancy rate in different parts of Florida is down this month compared to the rest of the year. Dover, Navarre Beach, and Indian River Shores had the lowest occupancy rates between 14% to 26%, while Havana, Cantonment, and Dundee have been booking 83% to 97% of the time.
Based on 2021 data, we expect short-term rentals to get more bookings starting in January 2022 and reach a peak during the summer. This makes 2022 an amazing time for investors to start looking for Airbnb properties for sale in Florida.
Airbnb Regulations in Florida
What is limiting the industry, however, is the tightening of regulations for Airbnb Florida and other short-term rentals. As more homeowners and investors listed their properties on platforms like Airbnb and VRBO, issues caused by rowdy guests increased tenfold. Neighbors called and emailed their local councils complaining about the noise, parking disputes, and disagreements over shared spaces.
This has caused the state government and local governments in Florida to enforce ordinances concerning short-term rentals and home-sharing. Florida law defines vacation rental as:
- Any unit or group of units in a condominium or cooperative; or,
- Any individually or collectively owned single-family, two-family, three-family, or four-family house or dwelling unit; and,
- A transient public lodging establishment but not a timeshare project.
Owners of vacation rentals are required to apply for a business license and follow regulations set by their respective municipalities. Condos and dwellings have different application requirements. You can find more information on the Florida Department of Business and Professional Regulation’s website.
Meanwhile, properties in which the hosts remain in the property and list the rooms as short-term rentals (also known as “hosted rentals”) are not regulated by the state. But the cities and municipalities may have ordinances surrounding this type of rental.
As you search for Airbnb properties for sale in Florida, do not just decide which city or neighborhood has the highest Airbnb occupancy rate and rental income. You must first look into whether you can list your property as a vacation rental in that particular city in the first place. If you violate the local and state ordinances, you may have to pay a large fine, shut down your listing, and be banned from hosting a rental in Florida.
Steps on How to Find Airbnb Properties for Sale in Florida
Florida has 282 cities, 109 towns, and 20 villages, or 411 possible locations for your next investment property. But because you would want to have your short-term rental set up by Spring 2022, you do not have time to visit these municipalities one by one for research. So here is a step-by-step guide on finding Florida Airbnb investment properties for sale in one day:
Step 1: Select Up to Five Cities or Neighborhoods for Your Search
As mentioned above, the Sunshine State has 411 municipalities where you could start an Airbnb business. So you have to decide on which cities–preferably no more than five–you will look into. Because you are investing in a short-term rental property, you would want to buy somewhere that gets a lot of tourists. A big city would be ideal, too, but you must prepare to shell out a larger amount of money compared to when buying a property in a smaller town.
When you use an online real estate tool like Mashvisor’s Property Finder, you can concurrently search up to five cities. This way, you do not have to open five separate tabs to look for and compare properties in each city.
Step 2: Narrow Down Your Search by Your Property Preferences
When you have started dreaming up your Airbnb investment, you may already have a certain property type in mind. Once you have decided where to find Airbnb properties for sale in Florida, you can filter your search further by your preferences, such as your:
- Budget: Set the maximum amount you are willing to spend on a property.
- Rental strategy: Check the box on whether you are planning to rent traditionally, list on short-term rental platforms like Airbnb, or both.
- Property type: You might be looking for a single-family home, multi-family dwelling, condo or coop, or other types like villas.
- The number of bedrooms: Depending on your target market, you might want to focus your search on a property that they would stay in (e.g. one bedroom for couples). This is also a great filter if you plan to do a hosted rental.
- The number of bathrooms: The number of bathrooms in a property can dictate its selling price. But you may also be able to charge higher daily rates if your property has a lot of bathrooms, especially if you are only renting out rooms.
If you use Mashvisor’s Property Finder tool and filter your search based on Airbnb rental strategy and other qualities, our AI will take your preferences into account. It will then show you houses with the highest potential for Airbnb based on Cash on Cash Returns.
Start out your 7-day free trial with Mashvisor now.
Step 3: Calculate a Property’s Potential Profitability
When you find Airbnb properties for sale in Florida that interest you, the listing price is not enough information for you to decide whether it will be a good buy. You also have to look into the following metrics:
Property Valuation Metrics
- Potential monthly Airbnb income: This is the estimated monthly income you could make if you list the property on Airbnb. This number is determined based on the monthly incomes of comparable properties in the neighborhood.
- Estimated expenses: These include your one-time setup costs such as home inspection, closing costs, repairs, furnishing, and appliances. You also have to factor in your monthly expenses like insurance, utilities, property management and maintenance, taxes, HOA dues, cleaning fees, and licensing.
- Estimated Airbnb cash flow: This shows how much you will have at the end of each month. Ideally, you would want this to be in the positive, but if you are buying a property using financing, you are likely to have a negative cash flow for the first few years.
- Estimated Airbnb cash on cash return: This calculates your return on the cash that you invested in the property. If you are buying a property using financing, this metric will show how much ROI you will get on the mortgage payments you made in a year, if any.
- Estimated Airbnb cap rate: This also calculates your return, but instead of the amount you paid, it is calculated on the total purchase price or current market value of the property.
- Estimated 10-year payback balance: Seeing the monthly performance does not show the full picture of a property’s profitability. When you calculate the 10-year payback balance, you can estimate your accumulated profits after 10 years and when you will be in the green.
How to Calculate Profits Using Mashvisor
If you are using Mashvisor, you can see that we have already made these calculations for you. You can find these estimates by clicking on any of the hundreds of Airbnb properties for sale in Florida listed on our platform. On the listing page, not only will you see the valuation analytics for that property and its neighborhood, but you will also see our Airbnb profit calculator. Here, you can type in your target monthly Airbnb rental income, expenses, and mortgage, and our calculator will give you a more accurate projection based on these numbers.
Step 4: Get Pre-approved for a Mortgage
At this point, you may have found at least a couple of Airbnb properties for sale in Florida that you would want to place an offer for. But if you cannot afford to buy in cash, then having a lender pre-approve your loan application will make your offer more appealing to the seller.
Alternatively, you could also get pre-qualified before even starting your property search. This method is perfect for investors who want to know how much they can borrow, so they could stick to that amount when looking for a rental home. Lenders decide on this based on your financial information and credit history.
Step 5: Contact the Seller and Start Negotiating
When you have your finances in order and have decided on which of the Airbnb properties for sale in Florida you will buy, it is time to place an offer. A written offer contains the following:
- Your personal details such as your name and current address
- The price you are willing to pay
- Deadline for the seller to respond to your offer
- An earnest money deposit, which is typically 1% to 2% of the purchase price
If you found the property on Mashvisor, you can use the platform to directly contact the property owner or real estate agent selling the house you want to buy.
5 Best Cities to Buy Airbnb Investment Property in Florida
Even with the step-by-step guide, you might still feel overwhelmed about where to start your search for Airbnb properties for sale in Florida. To help you, we gathered the latest Airbnb data to find the 5 best cities for Florida investment properties, specifically for short-term rentals, based on cash on cash returns.
Disclaimer: As of this writing, the cities mentioned in this list allow and regulate short-term rentals and hosted rentals. But we encourage you to contact the appropriate local government for the latest ordinance before searching for Airbnb properties for sale in Florida.
Ocala, FL
- Airbnb Rental Income: $2,828
- Airbnb Cash on Cash Return: 5.66%
- Airbnb Daily Rate: $134
- Airbnb Occupancy Rate: 62%
- Median Property Price: $341,089
- Average Price per Square Foot: $173
- Days on Market: 52
- Walk score: 62
- Known for: World’s horse capital and unspoiled nature
Sebastian, FL
- Airbnb Rental Income: $2,854
- Airbnb Cash on Cash Return: 5.30%
- Airbnb Daily Rate: $159
- Airbnb Occupancy Rate: 55%
- Median Property Price: $348,516
- Average Price per Square Foot: $229
- Days on Market: 45
- Walk score: 42
- Known for: NY Mets spring training, nature, golf
Deerfield Beach, FL
- Airbnb Rental Income: $3,049
- Airbnb Cash on Cash Return: 5.17%
- Airbnb Daily Rate: $191
- Airbnb Occupancy Rate: 61%
- Median Property Price: $390,079
- Average Price per Square Foot: $274
- Days on Market: 53
- Walk score: 78
- Known for: Beautiful beaches with fewer crowds, longest cable ski courses in the US
Palm Harbor, FL
- Airbnb Rental Income: $3,609
- Airbnb Cash on Cash Return: 4.69%
- Airbnb Daily Rate: $183
- Airbnb Occupancy Rate: 57%
- Median Property Price: $450,995
- Average Price per Square Foot: $242
- Days on Market: 45
- Walk score: 64
- Known for: Innisbrook Resort & Golf Club, where professional golf championships are held
Crystal River
- Airbnb Rental Income: $3,065
- Airbnb Cash on Cash Return: 4.69%
- Airbnb Daily Rate: $169
- Airbnb Occupancy Rate: 57%
- Median Property Price: $431,362
- Average Price per Square Foot: $226
- Days on Market: 67
- Walk score: 51
- Known for: Spring-fed rivers and manatee haven
What About Orlando, Tampa, and Fort Lauderdale?
While you are looking for homes for sale in Florida that you would want to turn into an Airbnb, you might be thinking that these three cities would be great for investment. But here are reasons why they are not on the list.
Orlando may be one of the largest vacation rental markets in the US thanks to Disney World, but the market looks to be overly saturated. If you invest in an Airbnb Orlando today, your estimated monthly rental would be $2,197, cash on cash return at 1.70%, and the occupancy rate at 49%.
Airbnb Tampa is not that lucrative, either. The estimated monthly Airbnb income is $2,306, cash on cash return at 1.99%, and occupancy rate at 47%.
As for Airbnb Fort Lauderdale, the estimated rental is $3,602, cash on cash return is 0.97%, and the occupancy rate is at 54%. These numbers may not be so bad, but the median property price in this city is $1,038,575. You either have to shell out a lot of capital or face a negative cash flow in the first few years.
Make Your Property Search More Efficient With Mashvisor
It is widely known by now that tourism in Florida is recovering, and the next spring and summer might see a record number of travelers in the state. But what is not seen by those outside the industry is that the Florida real estate market is also looking good. Investors searching for a bargain house that they could turn into an Airbnb may still find some that are priced below $100,000 as long as they stay away from big cities.
When you start looking for Airbnb properties for sale in Florida, however, you need to consider the municipal regulations on short-term rentals. Because even if you find an amazing property, if it happens to be located in a zone or city that does not allow vacation rentals, you will not be able to make money from it.
Finally, you are better off using an online tool that specializes in helping real estate investors find an investment property. Mashvisor is one of them. Using our platform, you can search up to five cities all at once, without needing to open so many tabs on your browser. You will also be able to filter your search by your preferences such as listing price, property type, and more.
We also have an Airbnb profit calculator that can help you estimate how much you can earn on a particular property that is listed on our website. And when you decide to purchase a house, you can use our platform to contact the seller. To learn more about how Mashvisor can help you find profitable investment properties, schedule a demo.
