Investing in Real Estate: What You Need to Know

Why Volusia and Flagler are investor friendly

• Diverse inventory: Beachfront condos in Ormond Beach and Flagler Beach, single-family homes in Palm Coast and Port Orange, townhomes and duplexes near Embry-Riddle and Daytona State, plus classic bungalows in DeLand and New Smyrna Beach.
• Lifestyle demand: Beaches, state parks, golf, motorsports, boating, and year-round sunshine keep both long-term renters and vacationers interested.
• Accessibility: I-95 and I-4 corridors connect to Orlando and Jacksonville, which supports job growth and weekend tourism.
• Price variety: Entry points for first-time investors, plus premium options in gated or golf communities.

The main investment plays

1. Long-term rentals (12-month leases)
   Stable cash flow, easier to finance, lower turnover. Target Palm Coast, Port Orange, DeLand, Deltona, Edgewater.
2. Mid-term rentals (30 to 90 days)
   Serves travel nurses, interns, and relocating families. Focus on places near hospitals, business hubs, and universities.
3. Short-term rentals (STRs)
   Works in coastal areas with tourist appeal. Regulations vary by city and neighborhood, so confirm zoning and HOA rules before you buy.
4. Value-add flips or BRRRR
   Buy, rehab, rent, refinance, repeat. Look for cosmetic updates, outdated kitchens or baths, and properties that benefit from wind mitigation improvements.

Run the numbers like a pro

Use these simple formulas before you fall in love with a property.

• Net Operating Income (NOI)
  NOI = Gross Rent − Vacancy − Operating Expenses
  Operating expenses usually include taxes, insurance, HOA or condo fees, property management, lawn and pool service, pest control, utilities you cover, and maintenance.
• Cap Rate
  Cap Rate = NOI ÷ Purchase Price
  Many investors target 6 to 9 percent for long-term holds. Markets differ, so compare apples to apples.
• Cash-on-Cash Return
  Cash-on-Cash = Annual Pre-Tax Cash Flow ÷ Total Cash Invested
  This shows the yield on your down payment and closing costs.
• Example
  Purchase price 325,000, 20 percent down. Monthly rent 2,650.
  Monthly expenses: taxes 350, insurance 275, HOA 100, management 265, maintenance reserve 160, vacancy reserve 80.
  Estimated monthly NOI: 2,650 − (350 + 275 + 100 + 265 + 160 + 80) = 1,420.
  Annual NOI: 17,040. Cap rate: 17,040 ÷ 325,000 ≈ 5.24 percent.
  Improve the return by negotiating price, increasing rent with value-add improvements, or reducing insurance via wind mitigation.

Financing, fast and clear

• Conventional loans: Best rates for 1 to 4 unit properties, requires income documentation and reserves.
• DSCR loans: Qualify based on property cash flow. Helpful for investors with complex income.
• Portfolio or local bank loans: Flexible terms, often good for small multis or mixed-use.
• HELOC or cash-out refi: Tap existing equity to fund down payments.
• Hard money: Useful for flips and heavy rehabs, higher costs, short terms.

Tip: Ask for a rate quote with and without points, confirm prepayment penalties, and request a loan estimate for total cost clarity.

Local factors that move your returns

1. Insurance reality check
   Florida policies can be higher than other states. Ask for quotes early, then explore wind mitigation, roof condition credits, and four-point inspections for older homes. Concrete block homes often insure more favorably than wood frame, especially near the coast.
2. Flood zones and elevation
   Verify FEMA flood maps and any lender requirements. Elevated properties or homes with proper flood vents can reduce risk and cost.
3. Wind mitigation
   Hip roofs, impact windows, reinforced garage doors, and secondary water barriers can lead to premium discounts. Ask your inspector for a wind mitigation report.
4. HOAs and condo associations
   Review bylaws for rental minimums, pet rules, and parking. In condo buildings, study budgets, reserves, special assessments, and percentage of owner-occupancy.
5. City-specific STR rules
   Daytona Beach, Ormond Beach, New Smyrna Beach, and Flagler Beach have different policies. Confirm permitted zones, minimum stays, licensing, and tax collection before you model income.
6. Property taxes and homestead
   Homestead benefits apply to primary residences only. For investments, model taxes using the expected post-sale assessed value, not the seller’s current number.

Where to hunt in Volusia and Flagler

• Ormond Beach and Ormond-by-the-Sea: Beach condos and single-family homes near parks and river access, attractive for mid-term and seasonal renters.
• Daytona Beach: University cluster and tourism create demand, consider long-term near campuses and hospitality corridors.
• Port Orange: Strong school zones, good for stable long-term tenants.
• New Smyrna Beach and Edgewater: Coastal charm, boutique dining, art scene, potential for premium rents in permitted zones.
• DeLand: Historic downtown and Stetson University, steady tenant pool.
• Palm Coast and Flagler Beach: Newer housing stock, golf and beach lifestyle, diverse HOA communities.

Scott Lee knows the micro-markets, and that saves time and money when sorting real opportunities from polished money pits.

The 8-step purchase checklist

1. Clarify your strategy: Long-term, mid-term, STR, or BRRRR.
2. Set your buy box: City, price, beds and baths, HOA or not, target rent.
3. Get pre-approved: Choose your loan path, gather docs, lock a target rate range.
4. Shortlist with Scott Lee: Private remarks, off-market leads, rental comps, HOA rules.
5. Offer with contingencies: Inspection, financing, condo or HOA review, insurance approval.
6. Order inspections: General, four-point, wind mitigation, roof, pool, and sewer scope as needed.
7. Insurance and flood review: Bind coverage only after you see the final premium and wind report.
8. Close, then systemize: Professional photos, tenant screening, lease templates, maintenance vendors, bookkeeping.

Quick upgrades that raise rent or resale

• Durable LVP flooring, neutral interior paint, modern lighting, and updated hardware.
• Energy efficient appliances and smart thermostats.
• Curb appeal: fresh mulch, trimmed palms, power wash, new mailbox and house numbers.
• For condos, focus on kitchens and baths that photograph well.

Common mistakes to avoid

• Underwriting with the seller’s current tax bill or an optimistic insurance guess.
• Ignoring HOA bylaws for rental limits or pet restrictions.
• Skipping wind mitigation, then overpaying for insurance.
• Pricing STRs on peak season only, instead of modeling by seasonality.
• Assuming “cash flow later” without a plan to create value in year one.

Work with a local pro

You want clear comps, local rent data, rock-solid vendor referrals, and early access to properties. Scott Lee specializes in Volusia and Flagler counties, and can help you identify the best neighborhoods for your strategy, navigate inspections and insurance, and negotiate like a pro.

Call to action: Ready to analyze a property or build a custom buy box for Volusia or Flagler? Connect with Scott Lee, Preferred Realtor, and request a no-obligation investor consultation.

FAQ

Is a condo or a single-family home better for a first investment in this area?
Condos often have lower maintenance but add HOA and association dynamics. Single-family homes give you more control and often better long-term appreciation. Run both scenarios with realistic insurance and HOA numbers.

Can I use 10 percent down for an investment purchase?
Most conventional loans for non-owner occupied properties require 15 to 20 percent down. DSCR or portfolio loans may offer flexibility, with higher rates or fees.

What cash flow should I target in Volusia or Flagler?
Aim for positive cash flow after fully loaded expenses, including a vacancy and maintenance reserve. Use cap rate and cash-on-cash return to compare deals across cities.

How do I reduce insurance costs near the coast?
Prioritize homes with strong wind mitigation, newer roofs, and concrete block construction. Get quotes from multiple carriers, then request credits after your wind mitigation inspection.