Traditional or Airbnb Fort Lauderdale – which rental strategy is optimal in this housing market?
When owning a rental property, one of the most important decisions a real estate investor has to take is the rental strategy. You can either rent out an investment property as a long-term rental (traditional) or as a short-term rental (on a site like Airbnb). The rental strategy that you should go for has to obviously be the one that makes the most profits. I mean, you do want to make money in real estate investing, right?
Now, what determines which rental strategy is more profitable than the other? Yup, you guessed it: the location. If your investment property is located in the Fort Lauderdale real estate market, your optimal rental strategy is definitely the short-term. Real estate investors renting out Airbnb Fort Lauderdale investment properties are seeing great returns this year. Here’s why and where you too should invest in Airbnb Fort Lauderdale real estate market.
What’s Special About Airbnb Fort Lauderdale?
In general, Fort Lauderdale, FL has been doing well lately as a real estate market. It was named among the top 10 markets in the U.S in the PWC’s Emerging Trends in Real Estate. Located in Florida’s southeastern coast and known for its beaches and boating canals, the city is named the Venice of America. Based on this, you can already tell why it makes sense to invest in Airbnb Fort Lauderdale.
In Fort Lauderdale, a real estate investor could choose to invest in a single-family home, condo, beach-front home, or other different types of real estate properties. These properties attract short-term tenants and would make a great rental income if listed on a site like Airbnb.
Related: Should You Invest in Short Term Rentals in Fort Lauderdale?
The city is definitely a tourists’ destination and was named (along with Miami) as the top domestic travel destination for Americans. People vacationing in Fort Lauderdale enjoy its numerous attractions like the beautiful Fort Lauderdale Beach, Hugh Taylor Birch State Park, Las Olas Boulevard and more. This makes it the perfect place to invest in vacation home rentals! In addition, with an occupancy rate of 56% and an average daily rent rate of $151 (according to AirDNA), Airbnb Fort Lauderdale real estate investors can expect an attractive rental income and return on investment.
Lastly, the 10-year appreciation rate for Fort Lauderdale investment properties is 7.75%. This is good news if you’re planning on investing in Airbnb Fort Lauderdale for the long-term and then sell the investment to reap high profits.
Want to start looking for rental properties to buy and rent out in the Fort Lauderdale real estate market? We’ve got you covered – Mashvisor’s Property Finder Tool is the best out there for real estate investors. All you have to do is set your criteria (city of choice, budget, rental strategy, and the number of bedrooms and bathrooms), and the tool will immediately show you a list of the best properties that match your criteria AND generate a high return on investment. To learn how this tool works, read this: How to Find Investment Properties Using a Property Finder Tool
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Airbnb Fort Lauderdale Laws and Regulations
One of the most important things to consider before investing in Airbnb in any real estate market is the laws and regulations associated with this type of investment. If you’re thinking of investing in Airbnb Fort Lauderdale, here are the main legal requirements you need to know to be allowed to rent out your investment property on Airbnb:
- Inspection of Airbnb Rentals: There’s a specific set of rules that your short-term rental property should be consistent with. Thus, Airbnb Fort Lauderdale investment properties undergo a home inspection to see if they meet these requirements.
- A Business License: Airbnb hosts in Fort Lauderdale need to have a business license and provide income statements. This is because renting on Airbnb is recognized as a business strategy in Fort Lauderdale.
- Property Taxes: Airbnb hosts are required to pay taxes on their rental properties. How much you have to pay will depend on your specific case. Failing to pay your taxes as an Airbnb host will result in penalties. Thus, make sure to research and do your own due diligence on the matter.
Traditional vs. Airbnb Fort Lauderdale
If you’re still not sure about investing in Airbnb Fort Lauderdale, just take a look at these numbers comparing Airbnb investments and traditional investments in the city. Keep in mind that the median property price in Fort Lauderdale is $667,305.
| Airbnb Investments | Traditional Investments | |
| Rental Income | $2,947 | $2,295 |
| Cash on Cash Return | 1.46% | 0.83% |
| Cap Rate | 1.46% | 0.83% |
As you can see from the Airbnb data above, Airbnb investments in Fort Lauderdale yield a better cash on cash return and cap rate than traditional investments. We should note that the cash on cash return is equal to the cap rate assuming you choose to buy an investment property without a mortgage loan. Don’t think this is a good cap rate? Read this: Forget Everything You’ve Heard About What Is a Good Cap Rate.
These numbers are projections estimated using Mashvisor’s rental property calculator. If you have a Mashvisor account, you can use this real estate investing tool to get readily calculated projections of traditional and Airbnb investments in any city (and neighborhood) across the U.S housing market! This will greatly help you analyze and compare different locations to identify the best one.
To start looking for and analyzing investment properties in your city and neighborhood of choice, click here.
Best Neighborhoods to Invest in Airbnb Fort Lauderdale
Middle River Terrace
- Median Property Price: $441,500
- Airbnb Rental Income: $2,768
- Cash on Cash Return: 3.07%
- Cap Rate: 3.07%
- Airbnb Occupancy Rate: 50.4%
Poinsettia Heights
- Median Property Price: $698,678
- Airbnb Rental Income: $2,667
- Cash on Cash Return: 1.04%
- Cap Rate: 1.04%
- Airbnb Occupancy Rate: 49.01%
Bal Harbour
- Median Property Price: $891,450
- Airbnb Rental Income: $4,040
- Cash on Cash Return: 1.98%
- Cap Rate: 1.98%
- Airbnb Occupancy Rate: 51.21%
Victoria Park
- Median Property Price: $719,179
- Airbnb Rental Income: $3,470
- Cash on Cash Return: 1.54%
- Cap Rate: 1.54%
- Airbnb Occupancy Rate: 49.67%
Lake Ridge
- Median Property Price: $439,661
- Airbnb Rental Income: $3,379
- Cash on Cash Return: 3.89%
- Cap Rate: 3.89%
- Airbnb Occupancy Rate: 49.53%
Sunrise Intracoastal
- Median Property Price: $719,600
- Airbnb Rental Income: $2,980
- Cash on Cash Return: 1.68%
- Cap Rate: 1.68%
- Airbnb Occupancy Rate: 50.87%
Coral Ridge
- Median Property Price: $1,184,591
- Airbnb Rental Income: $4,467
- Cash on Cash Return: 1.27%
- Cap Rate: 1.27%
- Airbnb Occupancy Rate: 53%
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Start Your Search!
So, what are you waiting for? The time is clearly right to start investing in the Airbnb Fort Lauderdale real estate market. You can count on us to help you analyze and find the best investment property in the city and start investing in no time.
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