Living In The Sun – Florida property sales and real estate services in the Sunshine State including, Kissimmee, Orlando and Disney

The Value

The £ is strong - the time is right....

Countdown to your home in Florida starts here. Recent figures indicate the majority of buyers spend between $75,000 and $250,000 on a property. Housing is generally considerably cheaper than in the UK, and the major USA cities.

We have put together an assessment of typical costs, which will help you establish a workable budget. These are general figures, and before you commit you should check the specifics for the particular house you want, but they will give you a good idea of how far your money goes in the US. Get in touch if you have any queries.

Budget	Taxation	Furniture/Appliances
House Running Costs	Car Running Costs	Letting

Budget

When calculating the cost of buying a home in Florida you should allow for up to 4-5% of the purchase price for closing & settlement costs. Fees may include the following.

         Inspection fees (e.g condition & termite inspections and land survey)
         Title search and insurance premiums.
         Legal fees
         Notary fee
         Government recording fees for the transfer of ownership and the mortgage to be recorded at the
         county courthouse (around $6 for the first page of a document plus $4.50 for subsequent pages)

Taxation

Property taxes may be payable in advance. The property taxes normally amount to approx. 1.5% of the property’s value and this is commonly paid on a monthly basis along with your mortgage payments. A sales tax must be charged on all rental income and this is currently 12%. It is the equivalent of the UK’s VAT The tax treaty between the UK and USA means that double income tax is avoided, although all rental income must be declared. However we recommend you obtain expert advice in this field and we can place you in touch with a qualified accountant on request, who will deal with your affairs in the best possible manner.

As a guide, all payments including the mortgage can be set off against due tax and it is not uncommon for the ultimate payment to be minimal, once the appropriate expenses are taken into account and in some cases it may even be wiped out completely, it depends on the circumstances.

Florida does not impose personal income, inheritance, or gift taxes. However, there are other taxes and fees that, in certain counties or circumstances, Florida residents may be required to pay. For further information refer to the State of Florida Department of Revenue website: www.state.fl.us/dor/

State sales tax is 6% with an additional local tax of 0.5%. There is an extra 5% on hotel accommodation, making that bill 11.55% – still cheaper than our VAT ! Rental cars also have a small additional tax charge per day.

Furniture/Appliances

While you may like to furnish and equip your home yourself, this can be somewhat time-consuming and expensive. Most buyers opt for one of our “furniture and house ware” packages. We do not consider it necessary or indeed advisable to spend excessive sums on furniture, but equally we believe it could be false economy to buy furniture of inferior quality which may not stand up to the rigors of a rental property. Our furniture pack will equip your property with attractive, yet hard-wearing furnishings. Everything from a color TV, washing machine, fridge, lamps, ashtrays and toilet rolls are included. More expensive pack are available and most items can be customized or upgraded to suit your taste and budget. We also offer a free interior design service and will be happy to arrange a suitable time for you to meet with our interior designer.

If you are offered the purchase of existing furniture in the property, this can be a very good deal, do not have it added to the purchase price, Pay the seller separately.

Electricity, gas and water companies in Florida are owned by private companies, local municipalities or the federal government (there are also cooperatives in some rural areas)

To get connected you should apply in person, sometimes called an ‘initiate application’ by taking with you proof of ID. You may also need to provide a security deposit. Electricity and gas bills are billed monthly in most areas. If you are to be a seasonal customer and spend three months or more a year away from Florida you can have your utility services suspended, thus saving any monthly customer service charge.

Electricity -the supply in Florida and most of U.S is 110/120 volts AC

Gas - natural Gas is piped from the Gulf Coast of Texas and Louisiana and is available in most Metropolitan areas of Florida. Gas is much less expensive for heating, hot water and cooking.

Water - all homes in Florida have water meters. Water rates range from $10 Orlando to over $25 Sarasota. Most water is of reasonable or good quality, although there are some areas where ground water is contaminated e.g. by chemicals, waste and salt water particularly in central and South eastern Florida.

Car Running Costs

Car insurance splits into three areas:

            Bodily injury liability for one person:
            Bodily injury for more than one person:
            Property damage liability:

Rates can vary dramatically with the same cover varying by 100 to 400 percent.

No M.O.T is required. A gallon of U.S Unleaded is about $1.40c or about 90p, they can’t begin to imagine our prices !

The two cheapest states in the U.S to hire a car are Florida and California. New cars are interesting - I looked at a brand new Chrysler Cherokee Jeep, built it online to a high spec and it came out at a shade over £34000 in the U.K the same vehicle built online with a U.S dealer in Florida came out after adjustment of exchange rate as £17000... and it costs £17 to fill her up here but it would be £70 in the UK !

Letting

If you wish to let your home it is a fairly easy task to do so - there are many letting companies in Florida and the highest number are in Orlando, due to the considerable demand.

There are areas in Florida where “short term rentals‘ are prohibited and this is particularly the case in Orlando. If you plan to let your home, unless you buy in a “designated short term rental area”, local government restrictions prevent you from legally doing so. Due to the fact that Florida attracts so many families that spend only part of the year there, many restrictions exist as to where and when short- term rentals are permitted, and these not only vary from county to county, but are also complex. It’s essential to get professional advice about the suitability of a particular community. We will ensure that the property you select is completely free from any such restrictions and is legally zoned.

Everyone involved in Real Estate has to to be State licensed, but this legislation does not include the area of letting. A good, reliable letting and management company is paramount. Many Real Estate firms are affiliated to letting companies so it’s wise to establish the position at the outset, as impartial ‘letting and or sales advice’ is may not be forthcoming from sources with a vested interest. Appointing a professional management company to manage and maintain your home in your absence is vital, and one that will provide you with high levels of occupancy throughout the year, ensuring that you obtain the best possible returns.

The number of weeks needed to rent a home to cover all of the running costs is dependent on the type of property chosen, the location and the amount and term of the mortgage. As a general guide, if you secure up to a 75% mortgage you will need to rent out your home for about 35 weeks per annum to break even on an average sized four-bedroom villa. If a fairly large home is selected it only takes another two or three weeks to cover the difference in out goings. A normal year of bookings will provide 21K-25K per year in rental income on a 4 to 5 bedroom home.

When purchasing a second home or “holiday” home to rent out, the standards to which the home should be furnished may depend on what is initially supplied. Most of the builders deliver a complete package including all the furnishings, kitchenware and linens. Very few clients upgrade the standard furniture packages, as they are so comprehensive and attractive. For the builders that do not handle furniture, our interior designers will be pleased to show you several examples of furniture packages that provide excellent value for money.

We help our clients obtain the most comprehensive policies from several of the nation’s leading underwriters. If you are letting your home, the management company should also make provision to obtain a security deposit from each group of guests on their arrival to cover all accidental breakages.

Estimated Costs & Letting Income (*This information is offered for guide purposes only.)

Estimated monthly management and running costs
All figures are quoted in US Dollars ($)
Example Condominium or Detached villa in the ‘Disney’ area of Orlando.

	2 Bed Condo	3 Bed Villa	4 Bed Villa>
	$	$	$
Administration Pool yard & pest control etc.	100	275	275
Utilities	125	230	250
Cleaning (twice monthly)	100	120	130
Repairs & Replacements	25	25	25
Homeowners Association	50	36	36
Taxes & Insurance	100	150	200

Total: Estimated monthly outgoings Excluding mortgage payments	500	836	916
Annual expenses	6,000	10,171	11,112

Projected Income

All figures quoted in US Dollars (US$) - Assuming a 70% occupancy rate.

		3 Bed Villa	4 Bed Villa
	$	$	$
Average net rent per week	384	524	664
Average net rent per annum	13,977	19,074	24,169
Estimated Expenses excluding mortgage per annum	(6,000)	(10,171)	(11,112)

Estimated profit excluding mortgage	$7,977	$8,903	$13,057

SCHEDULE OF CHARGES

MONTHLY

1.         Management Fee;                   $100
2..        Pool Service                              $90
3.         Lawn Care                                   $60
4.         Trash Collection                         $12
5.         Pest Control                                $25
6.         Owner booking handling fee $25 per booking
7.         Photocopies of utility bills       $10
8,.         INTERNET – see Schedule of Services
       (a)        Owner Link                                 $10
       (b)        Bronze level                                $25 – set up fee $100
       (c)         Silver level                                  $50 – set up fee $200
       (d)        Gold level                                    $75 – set up fee $350

MAINTENANCE CONTRACT – see Schedule of Services

(a)        3-bedroomed home                    $50
(b)        4-bedroomed home                    $60
(c)         5-bedroomed home                 $70
(d)         6-bedroomed home                   $80

CLEANING FEES

2 Bedroom                                $50                   5 Bedroom                                $80
3 Bedroom                                $60                   6 Bedroom                                $90
4 Bedroom                                $70                   7 Bedroom                                $100
Daily Maid Service                   $25                   Mid-Term Clean - from            $35

MISCELLANEOUS

One-time new Owner set-up fee      $150
Pool Heating                                           $10 per function
Pressure Cleaning Pool Decks      $50
Air Filter Changing (Bi-monthly)        $10
Light Bulbs (Bi-monthly)                        $4
Spring Cleans                From             $100
General Maintenance Per Hour         $35
Inventory Preparation                             $50
Attending Builders’ Walk-Thru’          $100     - (New Homes only)
Safety Package (if needed):                $275

Emergency Lights/sliding door locks/fire extinguisher

Fire Extinguisher Recharge               $65
Rekey to Master                                  $135
Blind Deadbolts                                    $85
Pool Warning Signs                             $75

For property in Florida (especally Orlando, Kissimmee, Davenport and Clermont) Greece, Alonissos, The Peloponnese, Skiathos, Skopelos, Zakinthos and Crete contact: John Goodwin - Tel: + 44 (0) 1590 626266

For Property in Cyprus, Croatia, Bulgaria, Italy & France contact: Steve Pearson - Tel: + 44 (0) 2380 879318

For Property in Spain and Turkey contact: Christina Harris - Tel: +44 (0) 1962 885602

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