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The Elite Team. The previous chart estimates the market value of today's median-priced house over a 40-year period, thus controlling for the fact that.

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Presentation on theme: "The Elite Team. The previous chart estimates the market value of today's median-priced house over a 40-year period, thus controlling for the fact that."— Presentation transcript:

1 The Elite Team

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3 The previous chart estimates the market value of today's median-priced house over a 40-year period, thus controlling for the fact that housing sizes have changed over time. The thick red line represents real house prices. For those unfamiliar with economic terminology, "real" prices are prices that have been adjusted for inflation.

4 Cape Coral Financial Statistics Median household income (per year) $47,345 Income change over time (increase since 1990) % Sales tax 6.00% State income tax rate n/a Cape Coral Housing Median home price National Median ($170,000) Home price gain (2-5 year gain) $110, %

5 The Cap Rate is short for capitalization rate. Cap rate is simply the rate at which an investment property earns money, depending on the value of the property. It is calculated by taking the net operating income – (gross rent minus expenses) – and dividing by the value of the property.

6 Example: A property is purchased for $100,000. This is the value of the property. The property brings in $1000 per month, or $12,000 annually. The property costs $400 per month to maintain, or $4800 for the year. Net Operation Income (NOI) is $600 per month, or $7,200 per year. $12,000 – $4,800 = $7200 $7,200/$100,000 =.072 (7.2%). The cap rate of the property is 7.2%.

7 Cap rate is an important calculation used when evaluating the financial performance of a property, and one that investors use frequently to give an “apples to apples” comparison of two properties. For example, properties can vary greatly in price and net operating income, but have the same cap rate, making them equivalent investments. Cap rates vary from market to market. A higher end investment (desirable area, better amenities) may have a lower cap rate than, say, a property in a less desirable area with less amenities. This is a premium the investor pays for a better quality property in a more desirable neighborhood. There are other factors, such as tax basis, cash on cash return and the debt service ratio, that can effect the Cap Rate. All which have been calculated on the Cash Flow Analysis that will be provided to you for each property that fits our model.

8 97.3% occupancy rate in the last 12 months Average tenant placement time 7-23 days 24 hour Emergency Services Prescreening service included with tenant placement Online bill pay/direct deposit available to tenants Direct deposit available to owners for monthly payment Complete accounting reports available online 24/7 Complete snapshot of single property and portfolio available online Management Discounted fees for multiple property portfolios

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12 1. Cape Coral-Ft. Myers, Fla. One-year change in home prices: 12.1% Median home price: $100,000 Change in price since peak: -63.4% Unemployment rate: 10.7%Cape Coral-Ft. Myers, Fla. Foreclosure rate: 1 of every 92 housing units (1.09%)

13 Cape Coral epitomized the housing boom and bust, so it's a shocker to see it rank first among cities where prices have risen most. That's especially true given that the rates of unemployment and foreclosure remain high and distressed properties still constitute half of all sales in the metro area, which ordinarily would exert downward pressure on demand and prices. Sales in this appealing area, with its 400 miles of waterways and access to the Gulf of Mexico beaches, islands and fishing grounds, are steady (and traditionally rise with the arrival of winter snowbirds). The region has just four months' supply of homes for sale, but that figure varies greatly by locale and property type (for example, from less than a month's supply of single-family homes in Lehigh Acres to a year's supply of condos in Ft. Myers Beach). By Patricia Mertz Esswein, Kiplinger.com Lehigh AcresFt. Myers Beach

14 For 50 years, families with children drove America’s housing industry. In this decade, renters could make up half of all new household with more than seven million new renter households. Because of these estimated emerging housing needs, this means half of all new homes built or bought between now and 2020 should be rental units.

15 The Cape Coral/Fort Myers area was recently recognized as being one of the top 10 most affordable housing markets in the world, according to an international survey. The survey originated from Demographia Inc., which ranked Cape Coral/Fort Myers 10 th in the nation. View the full report.

16 With the bubble clearly gone, the future home price path should follow the future rent growth path. That means home prices could also double in 14 to 20 years, though it is unclear when home prices will begin to catch up with rents. But long- term investors buying today are sure to catch some, if not most, of the upward ride. Rents rose at a better than 3.5 percent annualized rate in the fourth quarter of 2011, government data show, and private data sources imply even faster rent growth. commentary/economy/article/2011/11/rent-s-upward-ride- could-prices-follow commentary/economy/article/2011/11/rent-s-upward-ride- could-prices-follow

17 Topretirements.com The magnetic nature of the Ft Myers/Cape Coral area as a retirement destination provides additional, long term, upside potential Babyboomer-magazine.com As these "baby boomers" reach retirement age, looking for their place in the sun, they, in addition to the natural population grow expected, will provide an enormous pool of buyers and renters in our area that will translate to substantial gains in appreciation over the coming years.

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19 Cape Coral, Fl. Population: 530,920 Growth ( ): 60.8% US-Cities/3.html

20 Bloomberg Magazine May 2012 The best-performing metro area was Cape Coral, Florida, where prices increased 28.1 percent from a year earlier. rise-in-half-of-u-s-cities-as-markets-stabilize.html rise-in-half-of-u-s-cities-as-markets-stabilize.html

21 25 Best places to retire! florida/ florida/ Published May 2012

22 The new Lee County VA Outpatient Clinic will be a comprehensive healthcare center designed to accommodate the changing needs of veterans in the region. The clinic will be a state- of-the-art primary and specialty care center also offering mental health, diagnostic radiology, and laboratory services.

23 Approximately 25 percent of the Southwest Florida population is made up of veterans and 68,000 veterans live in Lee County alone. Those numbers will continue to climb as more veterans retire to Florida or return home from Iraq or Afghanistan. Once constructed, Bayside VA Clinic will have greater capacity to provide healthcare to a population of over 202,000 veterans in southwest Florida. City Development expects the properties adjacent to the clinic to eventually house restaurants, hotels and shopping centers, all bringing jobs and commerce to Cape Coral and Lee County. Within a decade or more, it is expected that construction of an I-75 interchange off of Del Prado Boulevard, a project already included in the city's 20-year plan.

24 Dominate market position in the $70-90k range to position for market rebound Focus on move in ready properties at affordable rental rates Aggressively seek properties in desirable and up and coming areas offering higher CAP rates and equity growth factors and positions Contract properties with a positive equity position offering immediate value and return on investment

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27 Property was purchased for $71,500 Work total was $ Property rented in less than 10 days 12 month lease signed for $850 a month 8.25% after repair and acquisition. Current As-Is value $85,000

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29 Purchased for $70,200 $ in repairs and updates Renters were acquired with acquisition Renters are paying $950 a month with 4 months left on lease Our property manager was able to renew a lease for 12 months at the $950 Property is earning money at a 12% Cap Rate.

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31 Listed for $85,000 Purchased for $75,000 Repairs $ including individual water meters Tenants were month to month, property manager was able to get one tenant to sign a 12 month lease with a $25 a month increase Second tenant moved out, however first tenant provided a new tenant the very next day for $50 more than original tenant was paying and new tenant will be providing lawn care. Property is earning money at 9.5% Cap Rate

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33 Property built in 2008 Purchased for $108,625 Repairs, cleaning, painting, freshening up $3500 Total cost of $112,125 Total Replacement Cost (on insurance dec page) $193,000 Able to get a renter 6 days after repairs for a total of 16 days at a monthly rate of $ on a 12 month term. CAP Rate 7.5%

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35 Year Built 1983 Property Sales Price $73,000 Repairs, Cleaning Freshening up $700 Total cost of $73,700 Renter in Place 27 days after acquisition paying $850 with a tenant. Cap Rate 9.5%

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38 Lehigh Acres is a medium-sized city located in the state of Florida. With a population of 86,784 people and 12 constituent neighborhoods, Lehigh Acres is the 78th largest community in Florida. There's nothing like the smell of a brand new house, and in Lehigh Acres, you'll find that a large proportion of houses were recently built. New growth in residential real estate is an indication that people are choosing to move to Lehigh Acres, and putting down their money on brand new construction. Lehigh Acres’ real estate is, on average, some of the newest in the nation. Lehigh Acres does seem to be experiencing an influx of affluent people, because the median household income is $38,517.

39 Unlike some cities, Lehigh Acres isn’t mainly white- or blue-collar. Instead, the most prevalent occupations for people in Lehigh Acres are a mix of both white- and blue-collar jobs. Overall, Lehigh Acres is a city of sales and office workers, service providers and construction workers and builders. There are especially a lot of people living in Lehigh Acres who work in office and administrative support (17.14%), sales jobs (13.35%) and management occupations (6.59%).

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41 Contract Processor/Closing Coordinating & Real Estate Concierge


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