Important Information to Consider if You’re Interested
in Renting a Condo to Tenants after Buying It
Many of South Florida’s Luxury Condos, Oceanfront Condos, and other Condos that are located in East areas that are close to the Beach are owned as secondary Residences by Owners who live in other States and Countries. As such, some potential Buyers are interested in obtaining information about Renting their Condo to a Tenant after purchasing it. This applies as well to Buyers who are interested in purchasing a Condo primarily for Investment purposes for generating Rental income. It is important to note the following regarding Renting/Leasing a Condo after you purchase it and this information is critical to consider prior to your purchase if Renting after purchasing is of significant importance to you.
- Some Condo Associations don’t allow Owners to rent their Units at all.
- Some Condo Associations allow Owners to Rent their Units immediately after purchase. Others require that Unit Owners own their Units for 1 Year or 2 Years before Renting them.
- Condo Associations specify the minimum number of days or Months that Unit Owners may Rent their Units and also specify how many times Units may be rented per Year. The majority of Condos require minimum Rental periods of 3 Months or 6 Months. A few Condos only allow 12-Month/Annual Leases.
- Very few South Florida Condos allow daily Rentals, weekly Rentals, or 30-day Rentals.
- The highest demand for short-term Seasonal Rentals in South Florida (3 Months, 6 Months, etc.) is experienced during peak Season. Peak Season occurs during the Months of October – March, with the highest of the peak occurring during the Months of January – March. That coincides with the same period of time during which many Condo Owners occupy their Condos. That being the case and considering items #3 and #4 above, many Condo Owners leave their Condos unoccupied during their absence instead of renting them. Yes, Off-Season short-term Rentals occur, but demand for them is much lower. South Florida simply doesn’t have nearly as many Visitors staying for 2 – 6 Months during the Off-Season, however, short-term Rentals during the Off-Season can be a great choice for Executives who require temporary Housing while in the area for work, for people who are relocating to the area, or for others who have short-term rental needs. Off-Season Rentals can also be attractive to Visitors whose primary Residences are located in Countries where their Seasons are opposite of ours (i.e. when it’s Summer in Florida, it’s Winter in their Country).
- If you would like a Condo with the most rental flexibility, a Condo Hotel is the best choice to consider, however, limited Financing options are available for purchasing a Condo Hotel Unit and most are Cash purchases. Keep in mind as well that average Condo Hotel sizes are smaller than average Condo sizes so far as Square Feet and number of Bedrooms. Many Condo Hotel Units are Studio Units and 1-Bedroom Units because smaller Units have higher Rental demand from Hotel Guests. Yes, large Condo Hotel Units are available, but they aren’t the majority. Note: No, Condo Hotels are not the same as Timeshares. A Condo Hotel Unit is owned individually by its’ Owner, individually Deeded to them, rented to Hotel Guests with Room revenue shared between the Hotel and Unit Owner, and Management and Rental of the Unit handled by the Hotel.
- Properties that are located in Communities that aren’t governed by Associations are also good choices to consider for those who are interested in the ability to rent their properties frequently. Many Communities of Single Family Homes that are located in East areas of South Florida are not governed by Associations.
- All Renters are required to complete and submit to the Association an Application that requires approval before they can occupy a Condo. The Application process involves Criminal Background screening, Rental history screening, etc.
- The Condo Association specifies what their requirements are regarding Pets being allowed in the Building. Some Buildings don’t allow Pets at all. Some allow Owners to have Pets, but don’t allow Renters to have Pets. The Association also specifies Pet Weight limits and Breed restrictions. Owners are required to comply with the specified Guidelines. Note: as a Condo Owner, you may specify that Renters of your Condo are not allowed to have Pets if that’s your personal preference (even if the Association allows Renters to have Pets); this doesn’t work in the reverse scenario, however.
- Property Management: A Property Management Company can be hired to manage your Condo, however, you might find that you’re able to easily manage the Condo on your own.
- Marketing your Condo for Rent: You can list your Condo for Rent through a Real Estate Broker or you may Market it for Rent on your own through Vacation Rental Websites such as vrbo.com, airbnb.com, and other methods. Note that item #8 listed above and all Condo Association requirements apply regardless of how the Tenant is obtained.
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